The towns fight back

Posted On Wednesday, 12 July 2006 02:00 Published by eProp Commercial Property News
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New model challenges SA developers who want to kill town centres with suburban malls.


Liberty International, the listed UK property giant owned mainly by South Africans, is leading a revolution of integrated shopping, living and working in some of the world's most sensitive urban centres.

This new direction could double its holding of blue-chip regional shopping centres in 10 years. It also offers a development model for SA city planners burdened by the fact that developers are building suburban malls that kill their central business districts.

Somerset West in the Western Cape had a thriving business centre until Colliers developed Somerset Mall nearby. It declined rapidly after that. Paarl, George and Nelspruit are among other medium-sized SA towns afflicted by the suburban-mall phenomenon.

Developers point out that assembling properties in town centres from many owners and getting good access for customers are drawbacks to centralised malls. But Liberty is showing that they can work.

Launched in the early 1980s by Liberty Life founder Donald Gordon and fellow South African Michael Rapp,  Liberty Life was one of the first in the UK to introduce shopping centres modelled on Liberty's Sandton City and Eastgate on the outskirts of major cities.

But growing environmental sensitivities and outcries against the destruction of Britain's inner-city "high streets" by out-of-town shopping centres have killed much chance of further suburban development. Liberty's only chance of expanding is in inner cities. But such developments are fraught with restrictions and public opposition. It can take a decade of planning approvals and construction before they start trading.

More recently, government and municipal planners have been insisting that retail developers build integrated residential units and offices - and take responsibility for urban regeneration beyond the properties' borders. This includes creating parks, building new libraries and renovating old structures.

"We weren't happy about mixed use," says Richard Cable, development director of Liberty International retail subsidiary Capital Shopping Centres. "But we had little choice other than to comply."

Yet, a few years later, Capital Shopping Centres is building models of mixed-use development from Norwich in East Anglia to Glasgow in Scotland and Cardiff in Wales. "W e're now in favour of mixed use," says Cable.

Recently completed, at 50,000 m² - about half the size of Sandton City - Chapelfield in Norwich is the first Liberty development to integrate residential and retail space in the original design. The designer also integrated the architecture, for instance using local green oak for colonnades. The 128-unit residential component includes 28 social housing apartments.

The 95,000 m² St David's 2 in Cardiff, which will link to the existing 40,000 m² St David's 1, will have 308 flats built above it. The combined St David's will create the Welsh capital's prime inner-city retail precinct. As part of its negotiated deal with Cardiff city planners, Liberty will build a new 5,000 m² public library.

Gordon personally donated a substantial sum to Cardiff's new opera house. This was part of the reason he was knighted last year; its main hall is called the Sir Donald Gordon Hall.

Westgate in Oxford is Liberty's most complex mixed-use city centre development to date. The 95,000 m² retail mall will be surrounded on two sides by nearly 200 flats. About half of them will be affordable housing. Oxford is one of the world's most historic cities.

Negotiating and planning the development took three years before Liberty's formal submission was made to the council in May. Liberty will contribute public improvements to roads, open space and a new public library.

The centre has been designed to have the least possible impact on the surrounding area. It will appear as three separate buildings and retain some existing facades, though on plan it is one centre. It will reuse demolition material and minimise energy use with naturally ventilated malls, low-energy lighting, a "green" roof and deep borehole cooling.

Approval and construction will take another five years. Liberty hopes to move onsite by December 2007 and expects the centre to open in late 2011.

Cable says a key to getting the project moving even at that pace is highly experienced and effective municipal planning officials. "Such a sensitive and complex development would be difficult if the officials didn't have the capacity."

Another facet of these developments is the need to work with surrounding property owners. Chapelfield in Norwich was developed jointly with Australia's listed Lend Lease, which Liberty recently bought out. Partner in the Cardiff centre is Land Securities, the UK property company which attempted a hostile takeover of Liberty International five years ago. The Oxford partner in Westgate is LaSalle Investment Management on behalf of a pension fund.

Both Liberty and the councils it is negotiating with are warming to these mixed-use redevelopments of town centres. Cable says they work well as catalysts for wider improvements to the urban fabric and public transport. Liberty is thinking of developing more residential space in future projects to strengthen demand for food stores and restaurants in its centres, and of keeping the units as investments instead of selling them on. 

Last modified on Wednesday, 21 May 2014 18:34

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