North East Retail and Leisure Study One North East February 2011 DTZ 23 Park Square South Leeds LS1 2ND Tel: 0113 246 1161 Fax: 0113 244 1637 Contents Page 1.0 INTRODUCTION ......................................................................................................................... 1 2.0 REGIONAL TOWN CENTRE CONTEXT ......................................................................................... 5 3.0 EMERGING TOWN CENTRE TRENDS ........................................................................................ 11 4.0 POLICY DRIVERS .................................................................................................................... 28 5.0 RETAIL CAPACITY MODELLING ............................................................................................... 34 6.0 LEISURE ANALYSIS ................................................................................................................ 57 7.0 THE HEALTH CHECKS ............................................................................................................ 77 8.0 STRATEGY RECOMMENDATIONS ............................................................................................. 98 Appendices Appendix 1: Catchment Area Map Appendix 2: Results of Household Interview Survey Appendix 3: RECAP Retail Capacity Forecasting Model Appendix 4: Health Check Report Quality Assurance Record Checked By: Janet Entwistle Date: 12 January 2011 Authorised By: Stephen Miles Date: 12 January 2011 Ref: Disclaimer and confidentiality clause This report should not be relied upon as a basis for entering into transactions without seeking specific, qualified, professional advice. Whilst facts have been rigorously checked, DTZ Debenham Tie Leung can take no responsibility for any damage or loss suffered as a result of any inadvertent inaccuracy within this report. Information contained herein should not, in whole or part, be published, reproduced or referred to without prior approval. Any such reproduction should be credited to DTZ. 1.0 Introduction Purpose and Scope 1.1 DTZ has been appointed by One North East (ONE) to undertake a study of the retail and leisure market in the North East. The study, commissioned in January 2010, was originally intended to inform the proposed integrated Regional Strategy. As a result of proposed changes to regional planning under the Coalition Government, its purpose has changed slightly although the scope of the assignment has remained as set out in the original study brief. It provides an up to date source of evidence for local planning authorities in the North East, to help them make strategic decisions about the future of retail and leisure development, and to harness the potential of retail and leisure to support sustainable economic growth. 1.2 Specifically, it is expected that the study will be used to: Provide a consistent data set for the entire region regarding future retail and leisure needs to address the mismatches between studies at local level Provide an independent perspective on the deliverability of floor space in key centres Enable conflicts across local authority boundaries to be addressed in respect of the delivery of large scale retail developments Provide a comparative analysis to examine the performance of centres and identify those areas where there are gaps or needs for provision Provide added value to local level studies to act as a benchmark against which such studies can be sense-checked Make ―strategic‖ policy recommendations regarding retail and leisure provision for local authorities to consider as part of their LDF processes and for other parties at the local or sub regional level. 1.3 There are four key strands to the work: Review of trends in retail and leisure – collection and interpretation of evidence relating to the performance and emerging trends in respect of retail and leisure sectors and how they are impacting on town centres in the North East Quantitative analysis and forecasting of future retail capacity in comparison goods retailing for the region over a 20 year period Qualitative analysis – assessing the performance and capacity of many of the region‘s key town centres and highlighting gaps and opportunities in those centres to which future policy may respond Identification of spatial policy implications – recommendations arising from the research for consideration at the local level. 1.4 It is important to stress that this study is a strategic exercise and that the results should not be used as a substitute for detailed retail studies at the local level. Nor should the results be used as the sole evidence in determining planning applications. The recommendations are strategic in nature and as such are concerned with matters that have inter-local authority significance. Methodology 1.5 The study has been approached in accordance with the four work-streams highlighted above: Stage 1 Review of National and Regional Trends in Retailing and Leisure 1.6 We have carried out a comprehensive desk based review which has focused on: Examining the context to retail and leisure provision in the North East including assessing the network and hierarchy of centres in the region and key performance indicators for the largest centres Emerging national trends in the retail and leisure sectors and how they are likely to impact on future development in the region Key policy drivers, including the changing emphasis of policy since the Coalition Government was elected. Stage 2 Quantitative Analysis and Forecasting 1.7 In agreement with One North East, we have prepared retail forecasts for 15 town centres in the region over a 20 year period from 2010. The criteria for selecting the centres was informed by the Venuescore ranking of every centre in the region. This identified nine regional centres: i.e. the 9 centres ranking most highly. A further 6 major district centres. were selected as case studies. The latter do not necessarily represent the most highly ranked such centres in the region (although most are), but were also selected to represent a geographical spread throughout the region. Their selection was also informed by other factors such as potential future changes to the catchment population or regeneration proposals. 9 major regional centres Newcastle MetroCentre Middlesbrough Darlington Sunderland Durham Stockton-on-Tees Redcar Hartlepool 6 Major District Centre Case Studies South Shields Washington Bishop Auckland Ashington Peterlee Berwick-upon-Tweed 1.8 We have also prepared retail forecasts for two groups of out-of-centre retail parks and superstores: those in and north of the City of Durham (including Tyneside and areas further north), and those to the south including Teesside, Darlington, Hartlepool and south Durham. 1.9 For the retail forecasting in this report, we have used our RECAP retail capacity forecasting Model, as we now use for all such retail studies. The RECAP Model is an empirical ‗step by step‘ model, based on the results of recent household interview surveys of shopping patterns in the region, as its method of allocating retail expenditure from catchment zones to shopping destinations. It is therefore not a theoretical gravity model, but is based on consumer responses about actual shopping patterns. It is also a growth allocation model; which allocates growth in expenditure to shopping destinations based on shopping patterns indicated by the household interview surveys, and informed professional judgements about how these will be likely to change in the future as a result of potential new retail developments. Stage 3: Qualitative Assessment – Health Checks 1.10 For the qualitative assessment, we have carried out health checks in accordance with PPS4 guidance of the nine main centres, which are: Newcastle MetroCentre Middlesbrough Darlington Sunderland Durham Stockton-on-Tees Redcar Hartlepool 1.11 We have also carried out an indicative desk based assessment of six smaller centres spread across the region. These centres were selected as case studies; South Shields Washington Bishop Auckland Ashington Peterlee Berwick-upon-Tweed 1.12 The health checks have been produced in accordance with PPS4 and have been assembled through a combination of site inspections, desk based research and consultation with commercial agents. 1.13 The emphasis of the health check analysis is to assess the performance of centres, whether there are any significant gaps in provision of town centre uses, and to determine the level of capacity that each centre has for further growth. Stage 4: Policy Recommendations 1.14 We have then drawn out policy recommendations from our analysis of the quantitative and qualitative assessments. We have highlighted key spatial policy implications and made recommendations to be considered by local authorities and other parties at the local and/or sub-regional level. Structure of Report 1.15 This report represents the final version of the report incorporating the findings of the four stages highlighted above. It is structured as follows: Regional Town Centre Context Emerging Town Centre Trends Policy Drivers Quantitative Modelling Leisure Analysis Health Check Summary Spatial Policy Implications 1.16 Detailed health check reports have been prepared for each of the nine major centres which are available at appendix 4. 2.0 Regional Town Centre Context Town Centre Hierarchy 2.1 We have identified the hierarchy of the centres across the study area in terms of both retailing, as identified by Venuescore