City needs holistic plan to ensure promising future - Liz McAreavey
This predicament is hardly surprising, given the formidable challenges that the retail sector has confronted in recent years. Growth in online shopping, disruption of the global pandemic and subsequent lockdowns, escalating costs, and inflationary pressures have collectively shaped a dynamic and shifting retail landscape.
A recent round table the Chamber hosted exemplified the important role we play in stimulating dialogue about the city’s future. Diverse stakeholders from retail, hospitality, tourism, transport, corporate law, and development attended the event, all fully engaged in a topic that is of fundamental importance to how our city will perform in the decades ahead. And the good news is that – while Edinburgh does face some challenges – the opportunities are greater still and investors are already interested and engaged.
Currently, Princes Street, our emblematic high street, appears somewhat forlorn. Rows of vacant units convey a sense of decline. Since 2012, the online retail market share grew from slightly over 10 to 30 per cent by 2022. Lockdowns inflicted further blows, and the ongoing crises of living costs and the cost of conducting business have further strained retailers.
This bleak picture is compounded by the dazzling success of Edinburgh St James, a £1 billion retail and entertainment quarter. The juxtaposition of this thriving development against the backdrop of Princes Street underscores the high street’s challenges.
Yet, appearances can be deceiving. Unlike high streets in many other British cities, Princes Street has plans for virtually every vacant space, with tourism emerging as a key solution provider. Footfall is surging, exceeding national averages by more than 60 per cent, largely attributable to Edinburgh St James but extending beyond its immediate vicinity.
Several upscale boutique hotels are in the pipeline, adding around 1,000 new rooms to the city’s accommodation options. These establishments will also introduce trendy bars, restaurants, and cafes, diversifying Princes Street into a vibrant mix of residences, offices, and social hubs. Investors, including major pension funds, are eager to channel their investments into Edinburgh.
Nonetheless, there are two substantial hurdles to overcome, as our discussion highlighted. Firstly, the logistical complexities of major redevelopment projects, sandwiched between a narrow lane and tram tracks, pose considerable challenges. Secondly, the construction industry faces a daunting economic environment.
Then add in the new challenges facing our tourism industry, which is driving so much of our potential future, most notably a new Visitor Levy, with much still to be decided on how the cash it generates will be spent, whether that will be through a flat rate charge or a percentage charge, how businesses can be helped to prepare for it, and what shape its governance will take. While many businesses believe the new “tourist tax” has the potential to be a positive, if invested in creating and supporting a sustainable, successful visitor economy that continues to provide tens of thousands of jobs, the sector needs to be convinced that the money will be additional and that its governance and use will be transparent.
Therefore, as our discussion noted, the city must come together with an holistic plan, instilling confidence in potential investors that their projects can navigate smoothly through an efficient planning system and alongside other planned transformations, such as the initiative to pedestrianise George Street. These exciting new developments will breathe new life into our city’s high street and ensure a promising future.