Shopping CentresThe decision by Marks & Spencer to open its first Limerick store at The Crescent shopping centre has left another city shopping complex without its planned anchor tenant.
Liam Carroll of Danninger, who is developing the €150 million Parkway Valley shopping centre off the Dublin Road in Limerick, had been expecting M&S to rent the main store when it is completed in the autumn of 2009.
Carroll is building around 37,160sq m (400,000sq ft) of retail space in an area where there is already over 74,320sq m (800,000sq ft) available in shopping centres and retail parks. He also owns the adjoining Parkway Retail Park.
Carroll's expectation that M&S would move into his Limerick scheme was partly based on the fact that the UK multiple is already anchoring his Tallaght Cross, a shopping complex which will have about 40 units with a total area of 27,870sq m (300,000sq ft) when it is completed.
M&S is understood to have been granted extremely favourable rental terms on its store of 5,574sq m (60,000sq ft).
Bannon Commercial, which is handling lettings in both centres, is now expected to target both Penneys and Debenhams for Parkway Valley though both multiples are already trading in the city centre. Penneys also has an outlet at The Crescent.
It is considered unlikely that Tesco would opt for the Parkway Valley because of its close proximity to both the Parkway shopping centre and Childers Road where Dunnes has two large stores. Dunnes operates a particularly successful round-the-clock operation at Childers Road where it has one of its best stores.
Dunnes will also continue to anchor the Parkway centre when it is redeveloped shortly by Pat Doherty's Harcourt Developments.
Tesco trades out of Arthur's Quay in the city centre and has just opened a new store at Coonagh Cross on the Ennis Road.
To persuade M&S to take a new 10,219sq m (110,000sq ft) two-level store in The Crescent, the Clancourt Group also had to offer highly attractive terms to the giant multiple.
The deal provides for a staggered rent to rise over a five-year period to around €139 per sq m (€13 per sq ft).
The group, run by the Kenny family, is also due to contribute around €2 million towards the fit-out.
The letting conditions underline the generous terms now being offered to all major multiple traders to persuade them to anchor shopping centres.
Though legal terms have been formally agreed in this case, Clancourt has yet to secure planning permission for the extension.
Limerick city planners have allowed shopping centres, such at The Crescent, to grow like topsy at the expense of the city centre which has been in serious decline for years.
Limerick is the only city in Ireland where out-of-town retail rents are higher than they are in the city centre - a serious indictment of the way that the city council has managed retailing operations.
