Exeter City Council is to revisit its stalled Citypoint redevelopment following the transfer of the Paris Street and Sidwell Street leaseholds previously-held by The Crown Estate and its partner Nuveen to Frasers Group as part of the Princesshay shopping centre sale.
The Mike Ashley majority-owned retail group, formerly known as Sports Direct International, bought Princesshay for a reported £80 million at the beginning of October from The Crown Estate and Nuveen, each of which previously owned 50% stakes in the 400,000 square feet retail complex.
It subsequently emerged that the Paris Street and Sidwell Street retail and office leaseholds granted to The Crown Estate and Nuveen during development of the Citypoint scheme were included in the sale, bringing the total city centre floorspace transferred to Frasers Group to 600,000 square feet.
Frasers Group Paris Street and Sidwell Street leaseholds after Princesshay sale. Source: Exeter City Council.
The £300 million Citypoint “development concept”, as it was described six years ago by then-council chief executive Karime Hassan, was the result of the September 2017 failure of private sector-led redevelopment proposals which were supposed to be delivered in parallel with the publicly-funded construction of the bus station and leisure centre.
The original scheme was presented as an extension of the existing Princesshay shopping centre across Paris Street, which was to be closed to motor traffic as part of the redevelopment.
When the project fell through the council continued with St Sidwell’s Point leisure centre and the new bus station, financing the construction of both itself at a cost of £54 million.
The replacement scheme for the site, bounded by Paris Street, Sidwell Street and Cheeke Street and including St Sidwell’s Point and the new bus station, included a mix of build-to-rent and open market accommodation, offices and flexible workspaces, retail and food outlets and two hotels.
It also provided a new civic centre to which the council would relocate, alongside new local offices for several central government departments and a University of Exeter “innovation hub”. The council’s Paris Street offices were to be sold for redevelopment as housing.
Replacement Citypoint redevelopment scheme drawing. Source: Exeter City Council.
However, as a report to Tuesday’s meeting of the council executive committee explained, the joint site redevelopment promotion deal the council agreed with The Crown Estate involved significant risk to the council.
The Crown Estate’s commitment to deliver the scheme’s first phase, the office blocks, flats and new civic centre intended for the site of the former bus station, was conditional on the council taking on a 40-year lease for the resulting floorspace – almost all of which would have to be let for the phase to be viable.
Since then, as the report says, post-pandemic changes have made it “very difficult for developers to fund and progress complex multi-phase mixed-use schemes”, the council’s financial position has worsened considerably and the government is no longer interested in an Exeter city centre presence.
(The council is also now looking to decamp from its offices on the other side of Paris Street to much smaller accommodation in the Guildhall shopping centre and elsewhere.)
The report also says that, while the council would now still like to pursue comprehensive site-wide redevelopment, it cannot afford to bring this forward on its own and also cannot compel other leaseholders to co-operate or sell their interests without using compulsory purchase powers.
Exeter City Council Citypoint former bus station site red line plan. Source: Exeter City Council.
It nevertheless retains full control of the former bus station site, on which the first phase of the previous Citypoint scheme would have been built.
It says there is interest from developers in a scheme on this site alone, but is reluctant to cede control by selling it on. It is also reluctant to seek a development partner for the former bus station as it might scupper the scope for a site-wide scheme.
Meanwhile, it says it has held “productive initial meetings with the new adjoining landowners who are interested in discussing the progression of the wider scheme”.
It has therefore resolved to try working up a redevelopment plan for the whole area with Frasers Group, and other potential development partners, while also assessing options to develop only the land in its sole control.
It will also consider temporary uses for the old bus station site, including the use of its concrete deck as a car park – the first year income to cover setup costs – while repeatedly saying that it cannot afford to do anything else with the land.
Council officers are expected to bring site-wide proposals back in January next year.
At the council executive committee meeting this week, councillors also tasked officers with bringing back plans in January for a public consultation on proposals for temporary use of the site, following an intervention by council leader Phil Bialyk.
This decision has, however, been recorded as “plans for consideration”, and not for consultation, so it remains to be seen whose account of the committee prevails.
Those running Paris Street and Sidwell Street businesses, many of which are responsible for an unplanned renaissance in the area, who may be concerned about their prospects after being notified about their new landlord apparently need not worry for now.
It seems clear that comprehensive redevelopment of the wider site is a long-term council aim that is likely to take several years to fulfil, if it is fulfilled at all.
They may also take some comfort in Phil Bialyk’s comment, made the last time a Citypoint progress report came before a council committee, three years ago, that the council “will want to work with whoever our partners are at the appropriate time to accommodate all those people who are currently there should they wish to remain.”
