Investec ‘fully committed’ to delayed 564,000 sq ft Manchester office project
The investor is still confident of progressing the comprehensive redevelopment of the Kendall Milne building on Deansgate despite complexities around leases and rights to light holding the scheme up.
Work to to refurbish the Kendall Milne Building into workspace and knock down the MSCP to construct a 14-storey new-build office has not progressed as quickly as Investec might have liked.
In order to prevent planning permission from expiring next June, the investor has requested permission from Manchester City Council to split the project into two phases and carry out some minor works – removing a pair of footbridges that connect the House of Fraser department store and adjoining multistorey car park.
Doing this will lock in the planning consent before it lapses.
The investor said that it had been unable to progress detailed design or secure funding for the 564,000 sq ft office project due to constraints around the property’s title.
Up until November last year, Manchester City Council held a 153-year lease on the MSCP, which needed to be renegotiated to allow Investec’s project to progress.
While this barrier has now been removed, others still exist.
A cover letter prepared by Turley that accompanies the application to split the project into two phases, states that negotiations with ground floor tenants in the car park are ongoing, while Investec is also trying to resolve issues around rights of light, “requiring protracted engagements with third parties”.
Investec claims “significant progress” has been made in ironing out these issues “to the extent that detailed design work can be funded and commenced with confidence”, the cover letter states.
In the meantime, House of Fraser is continuing to trade from the grade two-listed Kendall Milne building. Investec granted the retailer a rent-free lease in 2019, recognising the importance of maintaining an active use at the prominent site.
Turning this into another office is such a waste of a great, semi-public building and represents the further deterioration of Manchester retail and tourist offer. People used to travel a long way to spend a day at Kendals and other than M&S there’s nothing else for that demographic. The rooftop extension is not sympathetic at all.
By Kendal
Didn’t realise Kendal Milne were still trading from there. Well that’s a Christmas visit sorted. Hopefully there will be some decent retail on the ground floor once this is finished
By Tom
Don’t need offices. You could make some very very fancy flats out of Kendals.
By Anonymous
Let’s hope so because the new build is stunning. Even if they just build that I’ll be happy. The removal of the bridges means the car park can then be demolished. This will pave the way for PAGs proposal to come forward.
By Andrew
Even more retail lost in Manchester, we used to have loads of shops and department stores
By Josh Burns
” The Board have every confidence in the Manager” style pre-sacking football manager.
By Cloughie
If the building was chopped up to create flats you would lose forever its open nature which is a key part of its listing. Public access would be lost forever. Let’s hope the office scheme materialises
By Sushi
People seem confused about this . There will still be retail on the ground floor. Retail has changed significantly for obvious reasons over the years and developers respond to demand. Do you shop on line? Yes? Well there you go now you’ve got your answer.
By Mylordan master
I’m not sure it’s that simple, yes retail has changed and many people do shop online, but yet some department stores are doing quite well such as Selfridges and the recent opening of the END store just off Deansgate with young people queuing outside for the release of the latest trainers, young people do still go out and browse and shop you just have to give them a reason to, of course for cheaper items people will probably still shop online but that isn’t what a high department store is, i’m no fashionista but House of Fraser takes me back to my high school years in the 10s, they still sell same Ralph Lauren polo i used to see in 2011, its no wonder why they’ve struggled with sales and can’t pay the increasing rent and debt.
By Anonymous
It really should be 3 floors of retail (basement, ground and 1st floor, with ten floors of office, i.e. get rid of part of the roof extension. The 1 story height reduction would also sort out some of the right to light issue. They’d also make more money swapping out some office for more retail, as there’s a move back to in store purchases with hybrid online retail.
By Dr B
Couldn’t agree more with Dr B and the previous comment. There seems to be an attempt to make out that bricks and mortar retail is dead to excuse the dire state of city centre retail in Manchester and justify short sighted schemes like this. Maybe if we hadn’t made the mistake of expanding the miserable and inward-looking Arndale centre and consolidating all the ways in which the Arndale undermines the viability of retail space outside that shopping mall, we might not be in a place where investors see lower-risk and more profitable returns from converting this iconic department store into yet another office (notwithstanding the glut of grade-A office space that’s struggling to let at the moment).
At the very least we should have more than just the ground floor saved for retail use.
By Kendal
The most impressive thing about this is the pedestrianisation of Deansgate!!
By Levelling Up Manager