St James Quarter: A blueprint for success

St James Quarter, Edinburgh’s newest lifestyle destination, celebrates its third anniversary this summer. As well as enhancing the Scottish capital’s retail offer, the unique development presents a compelling vision of how a mixed-use physical concept can thrive in our digital age.

The first phase of St James Quarter (SJQ) was opened in June 2021 as soon as Scotland lifted its COVID-19 restrictions so there will be three candles on its birthday cake this summer. In those odd post-lockdown conditions, the development attracted 10.5m visitors in its first nine months as retail began its slow move back to normality.

In these happier times, with more than 19m visitors welcomed in the 12 months to March 2024 and a waiting list of premium tenants for its 100 or so retail units, the lifestyle development is moving forward with confidence. As a major element in the ongoing revitalisation of the city centre of Edinburgh, the Quarter underlines the potent demand for physical stores and real-life experiences.

Anne Ledgerwood, estate director for SJQ, who has spent over 20 years working in the conventional shopping centre sector, points out that the handsome site at the eastern end of Princes Street represents a new and relevant advance in multi-use destinations.

“St James Quarter is next-generation. It’s reinvented the space for a city centre development. It’s not a closed, standalone building, it’s an integral part of Edinburgh’s cityscape. Perhaps most importantly, it’s right-sized for what it’s meant to be. The old idea of making a centre as big as possible and filling it with as many tenants as possible is the anthesis to what’s been done here.”

You don’t have to be a passionate supporter of Scottish independence to note that St James Quarter would be better known and more talked-about if it was on a more southerly latitude. Conceived in 2005, given planning permission in 2009 and constructed between 2016 and 2021, the 1.7m sq ft lifestyle district is innovative and bold.

St James Quarter is a 1.7m sq ft lifestyle district

Around 70 shops and stores, about 30 food & beverage units, a five-screen boutique cinema, a bowling alley and games centre, a 244-bed luxury hotel, a 75-bed premium apartment-hotel, 152 residential units and a 1,600-space car park have fulfilled the developers’ vision of creating a destination that simultaneously complements and enhances what is – let’s not forget – a UNESCO World Heritage Site.

The Old and New Towns of Edinburgh, an area covering about 1.7 square miles (4.5 square kilometres) and with almost 4,500 buildings, were awarded that status in 1995. St James Quarter is at the eastern end of the original New Town, which was designed by James Craig and built between 1767 and 1820.

Edinburgh’s main shopping thoroughfares, Princes Street and George Street, plus the smaller Thistle Street and Rose Street, all lead to the new development, which with some justification considers itself a “best-in-class” urban attraction.

Significantly, the Quarter was conceived and delivered not by traditional shopping centre specialists or well-known property firms, but as a joint venture between two asset management businesses, the US-based Nuveen Real Estate, which is one of the largest investment managers in the world with $156 billion of assets under its control, and APG, a Dutch pension asset manager.

The stylish and sparklingly clean St James Quarter replaced the unlovely St James Centre, a grim 1970s entity whose brutalist construction style would not have looked out of place in a Soviet Bloc country. Rather than tinkering around the edges to improve the old, Nuveen went for a total rebuild, which required £1 billion of investment and gave work to almost 7,000 construction workers.

The quarter was designed by Edinburgh-based Allan Murray Architects (AMA). Today Nuveen manages the finished project.

In another example of the developers’ innovative approach, the Quarter is run more like a department store than a traditional centre, says Mark Bentley, director of retail and commercialisation, who has more than 20 years’ experience in senior roles in retail operations.

“Our trading strategy is run on data because all of our tenants (except financial services) supply their trading figures to us as part of their lease. It’s certainly not a common approach but thanks to our analysis of sales figures, footfall counters, information on conversions and transaction values and so on, the result is we are able to provide lots of relevant retail support, as well as marketing support. It’s very much a partnership, a collaborative approach.”

Amusingly, among the Quarter’s management team there is a total ban on the C word. This is NOT a shopping centre, it is lifestyle district, a mixed-used destination led by retailing. For a start, this is not a shuttered, climate-controlled environment. The Quarter’s main architectural feature is its galleria, which is actually a curved street that echoes the splendid crescents of historic Edinburgh.

Serving local residents, large numbers of visitors from other parts of Scotland and the UK, plus the mass of tourists from around the world that flock to Edinburgh, St James Quarter has become a must-visit attraction.

For attracting those almost 20m visitors, the five levels of the Quarter are ideally situated at the eastern end of Princes Street, just across the road from Waverley, Edinburgh’s main railway station, and en route to the increasingly fashionable neighbouring town of Leith (non-locals are advised to avoid referring to Leith as part of Edinburgh).

The arc of the galleria links to Multrees Walk, the city’s designer brand enclave that has Harvey Nichols and Louis Vuitton as key attractions. Just across St Andrew’s Square is George Street, which is another significant retail thoroughfare, although not as strong as it once was.

Although St James Quarter’s management team avoids criticism of any of its neighbours, it’s obvious that Princes Street has seen better days. House of Fraser, Debenhams, BHS, the Arcadia flagship (itself occupying the long-gone upmarket department store R W Forsyth) and Jenners department store have all ceased trading on the street in recent years, making the arrival of the nearby Quarter even more relevant and timely.

John Lewis upgraded from the old St James Centre to the new St James Quarter

Well placed to compare the old St James Centre with the new St James Quarter is Barry Blamire, who heads up the store team at John Lewis, one of the few retailers that made the upgrade from the former to the latter.

A Partner for 28 years, since 2012 Blamire has been in charge of the Edinburgh store, so he was around to “enjoy”, if that’s the word, the experience of continuing to trade while the old centre was demolished and the new development constructed in its place. He can laugh about it now, but keeping a store running while it was being underpinned to stop it falling into a 68-foot deep hole that three floors of an underground car park required cannot have been fun.

He recalls: “The St James Centre was opened in 1973 with John Lewis as its anchor department store. It was the Partnership’s first store in Scotland. It was redeveloped and refurbished in 1988 and again in 2000 before it became central to the plans of Nuveen to develop a new lifestyle destination at the east end of Princes Street.”

Today John Lewis trades across six floors, three of which have direct access from the central Galleria. There is also access from Leith Street, where a short façade is the only trace of the old centre. Across 155,000sq ft of GLA space, the store employs around 440 Partners. With consultants and concession staff, more than 500 people work in John Lewis, which feels the ideal department store for SJQ.

Says Blamire: “I cannot think of any other city centre development in the UK like St James Quarter.

“The core Edinburgh demographic closely matches John Lewis’s – predominantly female, shopping at a medium-to-premium price level, having a high disposable income, well-educated, typically a First Adopter, so the store has always traded well.

“St James Centre, however, was mostly for locals. The big difference in St James Quarter is that our Edinburgh John Lewis customers have become more diverse, with more people from different age groups and backgrounds. People travel from further distances to come here. We have stronger late-night trading, for example, and have adjusted our hours to service this demand.

“We have also raised our game in other ways. For the opening we refurbished our interior, which was largely rebuilt anyway. With an on-site visual merchandising team, we have put in more VM in the store.

“For the new demographic the Quarter attracts, we have brought in cosmetics brands such as Jo Malone, Hermès and Armani Beauty. Nespresso, which closed its shop on Multrees Walk, is another new lifestyle addition.

“Our new services include our (cosmetics advisor) The Beauty Society, opticians, bigger and better personal styling suites – all the sort of things you cannot get online. We know we need to give people a reason to visit a physical shop.”

John Lewis is in appropriate better-to-premium company across the five levels of the Quarter. With Superdrug, Boots and H&M representing its entry-price levels, the main core of the retail offer is pitched above this, but below the expensive (aka “luxury”) level to be found in Multrees Walk with its line-up of, Louis Vuitton, Burberry, Mulberry, and soon-to-open Gucci, among others.

It is noteworthy that Reiss in 2021 and Boss and Coach in 2022 relocated from Multrees Walk into St James Quarter, Moss (formerly Moss Bros) brought its new store concept to Scotland in March. Molton Brown and New Balance are due to open in mid-2024 with another four brands currently in legals and due to launch before the end of the year.

As a new addition to guest services at the Quarter, which include the loan of mobility scooters, pushchairs and even buggies for small dogs, in March car hire firm Europcar opened a small unit on the lower level, their first ‘store’ concept, which makes sense when you consider how many American tourists arrive in Edinburgh laden with golf clubs for a tour of the classic Scottish courses.

Chris Pyne, the affable leasing director for the development, knows he has a winning destination on his hands by the length of the waiting list for his all-too-limited spaces. Despite having done much of his initial leasing during COVID-19 when he could not meet potential clients on site, he has maintained tight control over who makes the grade.

In another reflection of changing times in retail, most of the tenants at SJQ are on a turnover rent or a base plus turnover rent arrangement. With a review window, typically after three years trading, non-performers, the ones that do not quite work out, can be moved on.

“I am pleased to say that despite all the problems caused by the pandemic, we have stuck to our original game plan to be a premium destination,” says Pyne. “We are fortunate in some ways to have a relatively small number of units, as it helps with exclusivity, but there are some appropriate brands we just don’t have space for. We encourage our partners to bring their newest and best shopfits here.”

Inditex brands Bershka and Stradivarius are among those to open their first Scottish stores in St James Quarter

Among the retailers to open their first Scottish branches at St James Quarter are London-based eatery Duck and Waffle, HBeauty and Inditex’s Stradavarius, Pull and Bear and Bershka.

Another important strand on leasing is to find room for local businesses and not necessarily major names. Glasgow-based eyewear specialist IOLLA (the name means sight in Gaelic) was trading well in Stockbridge, Edinburgh’s district for interesting independents, but founder Stefan Hunter felt that its “insider” charm also had limitations.

“Chris Pyne was very good at discussing all the angles when he approached me about moving to St James Quarter,” Hunter explains. “My big fear was losing the customers I’d built up in Stockbridge, who allegedly rarely venture into the city centre, but that has not happened. They still come to see us. We are now more central, so we see more customers. They come from near and far. Being in the Quarter has unlocked many opportunities for us. And we are very well looked after by the team.”

Even after three years’ trading, development continues. The W hotel, only the UK’s second example after the one in London, opens on to St James Square , a small thoroughfare on the perimeter of the Quarter, opposite James Craig Walk named after the 18th-century designer of the New Town, it contains a few historical buildings that offer more retail and F&B spaces.

Marking its position as a significant consumer destination, St James Quarter will be one of only three official Team GB fan zones for this summer’s Olympics in Paris. From the large platform area on the fourth level visitors will enjoy a fine view of Edinburgh and appreciate how well the new development enhances Scotland’s capital city.