Number of empty shops soars in Old Town

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DOZENS of shops across the heart of Edinburgh's Old Town are lying empty as the impact of the economic downturn hits small independent retailers hard.

New research by the Evening News has revealed that 29 shops and bars are vacant in the area between the Royal Mile and the Cowgate and Grassmarket.

The recession has been blamed for crippling small businesses who cannot afford to suffer any decline in already hard-pressed profit margins.

And property experts say that very few new retailers are coming into the Capital, causing many shops to lie empty for several months and even years after firms close their doors or relocate.

The findings come after the Evening News last month revealed that a shop or cafe is closing at the rate of one a week in the main city centre block, between Princes Street and Queen Street.

Business leaders say that, while many of the 55 empty shops in the main shopping blocks will be available as a result of national chains going bust, today's data shows the impact that the slowdown in consumer spending is having on the smaller independent retailers that dominate the Old Town.

Among the Old Town streets hardest hit by shop closures is the Cowgate, which has been almost wiped of all retail as a result of the closure or relocation of shops, including the Edinburgh Copyshop, Concrete Wardrobe and Window Clean Supplies.

The neighbouring Holyrood Road has also been depleted, leaving empty units dominating a route to the Scottish Parliament.

Michael Dixon, chairman of the Federation of Small Businesses in Edinburgh, said that many of the empty shops will be a result of a lack of confidence about setting up a shop six months ago.

He believes, however, that there are signs that interest in opening retail units has started to return as the economy steadies. But it is likely to take up to six months before that translates into new shops appearing in the city.

He expects many of those who have been made redundant by financial firms to be among those reviving the retail sector for new small independents.

"The figures that the Evening News have come up with suggest there has been a lack of confidence in previous months about setting up retail business in this part of town," he said.

"This is a shame as it is at the start of the key summer season, which could be very good with lots of foreigners taking advantage of exchange rates.

"Everyone likes to see shops that are a bit different and there is still good business out there for those who can open the right type of shop.

"However, recessions do tend to be times when start-ups become more buoyant, partly because of people coming out of a first wave of redundancy and using their package to do something they have always fancied."

Even those areas well-regarded by shoppers for their unique independent stores have started to show the first signs of the impact of recession.

A prime spot on the Grassmarket has been empty for more than a year since luxury menswear shop Peter Johnston relocated to Queen Street, while Pyramid Imaging also departed the Grassmarket for Jane Street, leaving behind a note proclaiming that it had found "free parking and easy access at last" – a clear swipe at the stream of roadworks and access issues that have hit traders in the area.

Nearby at Victoria Street, another two independents have left. Wooden toy specialist Pinocchio, a finalist in the Toy Retailers Association's independent toy retailer of the year awards in 2007, lies empty, while further up the hill Pine and Old Lace, an antiques business specialising in dressers, kitchen furniture, bedding and tablecloths that had been on the street for 30 years, has had to call it a day.

Ian Clarkson, who has been senior partner at Clarksons` of Edinburgh Jewellers on Victoria Street since it opened 51 years ago, said: "The problem around here is the constant disruption. First it was the Grassmarket revamp, then the demolition of the old Lothian (Regional Council) building, then the Khushis fire. Then when you do get a good Saturday trading there's some event on; a march, a race or the rugby.

"When it is a difficult time, I think people will notice all these things more than ever."

At Jeffrey Street, the Karma womenswear shop closed last summer but there has still been no new tenant willing to set up, despite it being yards from the Royal Mile, the centre of the city's tourist activity, especially during the Fringe.

Culverwell, the letting agent for the site, is now offering flexible short leases at the unit to try to entice potential shop owners to take a chance on setting up a business.

John Conroy, a partner in the retail department at property firm Ryden, said: "There are a few exceptions but you usually find property in the Old Town still getting interest from the secondary market, such as local traders.

"Rents in these sorts of places are a lot cheaper and the landlords tend to be willing to offer more flexibility to get companies in."

He said that retailers see opportunity for activity at the "value end" of the market and can be enticed to gamble on opening up shop in some of the units if they are offered short-term deals.

"There is often a flurry of interest from Easter until early summer, then it's quiet again until August then companies start to take units until October ahead of Christmas," he said. "So it is around then that we expect things to get moving."

'IT'S LIKE THE CITY WANTS TO BANKRUPT SMALL BUSINESSES'

DOUGIE DUNBAR was the owner of Pyramid Imaging in the Grassmarket before the shop ceased trading earlier this year.

Now relaunched as Pyramid Imaging Limited in Jane Street after his staff bought the company out, Mr Dunbar blames the council for the demise of his business.

He said: "All the empty shops are partly as a result of the recession, but I would say it's more lack of support from the council.

"It's almost as if the council has a wish to get all small businesses bankrupted or moved to the peripheries of the city. They are obstructive and unhelpful."

Mr Dunbar said roadworks, over-zealous parking wardens and council regulations had forced him out of the Grassmarket. The company is now run from a 2,200sq ft industrial unit.