More than 120 years of retailing history in Edinburgh is set to be brought to a halt after the new owners of the iconic House of Fraser store in the city’s West End revealed it is likely to be overhauled to become home to new offices.
New bars and restaurants could also be built on the ground floor of the landmark under a dramatic overhaul of the site, on the corner of Princes Street and Hope Street, which is expected to cost at least £10 million.
The conversion of the building into a new department store, hotel or serviced apartments has been all but ruled out following months-of-behind the scenes talks.
The 70,000 sq ft site, which was previously home to celebrated department stores like Robert Maule & Son and Binns, was snapped up last year by Edinburgh-based property developer Parabola.
The same firm is spearheading plans for a major extension of the Edinburgh Park business hub which would create more than 7000 jobs and 1800 new homes if it wins permission from the city council.
Its Princes Street deal was clinched just months before the 42-year-old Frasers store’s closure was confirmed by the ailing retail giant, which is expected to shut the store by the beginning of 2019, with the loss of 127 jobs.
The developers have revealed they are in “serious discussions” with a preferred company to take forward a revamp of the site.
They say the Frasers building is not suitable to meet the demands of modern-day retail when a vast new shopping centre is being created at the east end of the city centre.
The planned overhaul of the building is expected to help address a shortage of high-quality office accommodation in the city centre due to the lack of new developments coming out of the ground.
The site, on the corner of Princes Street and Hope Street, has had a department store on it since 1894, when Maule’s opened its doors, and has been run by House of Fraser since 1953.
When the site, which is said to have suffered from a lack of investment since House of Fraser acquired the historic Jenners store at the East End of Princes Street, was put up for sale last year the agents handling inquiries said it was a “unique opportunity” to acquire one of the city’s six key department stores.
It was also touted as the possible site for a new hotel – echoing its short-lived use in 1877, when it operated as the Osborne Hotel, before becoming home to the Scottish Liberal Club.
However the lay-out of the current store, which has been largely unchanged in recent decades, is believed to make it unattractive to other retailers, particularly when 850,000 sq ft of new retail space is being created at the new St James Centre development, which is due for completion within the next two years.
Peter Millican, chairman of Parabola, revealed a design competition had been instigated to produce new visions for the future of the building, which is said to have been snapped by the company for a price “significantly in excess” of its £13.7m price tag. Parabola’s previous projects have included Central Square in Newcastle and King’s Place in London.
Mr Millican added: “Since we bought the building last year we’ve had a lot of approaches for a lot of different things and that certainly accelerated after the closure of the department store was announced by House of Fraser. At the moment we’re weighing up what we think will bring the most value to Princes Street.
“It’s not going to be a department store. No-one is going to want to take it. Those days are finished. The city is desperate for new offices, it would stack up financially as offices, so unless we get a better offer it will be offices.
“It’s a beautiful building in an incredibly prominent site. It book-ends Princes Street. It’s a key piece of the city. It was inevitable it would generate interest. We want to do something we think is worthwhile and will bring life to that end of Princes Street. If we get it right it will revitalise that whole corner of the city.”
One property industry source said: “The St James Centre development means most of the retail focus in the city centre is going to shift to the East End.
“There have already been huge changes in the area in recent years thanks to the opening up of St Andrew Square Garden, the arrival of the tram, and the ongoing developments around the various sides of the square. Other developments by Gleneagles and Malmaison are not even open yet and the new indoor concert hall will also be built in the East End. It is obvious that the city needs major new developments in the west end of the city and this will help breathe new life into the whole area.”
Parabola, which snapped up nearly 50 acres of land at Edinburgh Park in 2013, last year set out plans to turn the area into “one of the most desirable places to live and work in Edinburgh.” The area is home to more than one million sq ft of offices, including bases for RBS, Diageo, HSBC, JP Morgan and Sainsbury’s Bank.