Lancaster City Council

Lancaster City Council

Lancaster City Council

Lancaster City Council Lancaster District Retail Review December 2015 Address: Quay West at MediaCityUK, Trafford Wharf Road, Trafford Park, Manchester, M17 1HH Tel: 0161 872 3223 E-Mail: planners.manchester@wyg.com Web: www.wyg.com

WYG Planning and Environment creative minds safe hands Contents Page 1.0 Introduction . 1 2.0 Population and Expenditure . 3 3.0 Capacity in Existing Centres . 13 4.0 Retail Capacity (Job Baseline OBR) Employment-Led Growth . 40 5.0 Recommendations and Future Retail Strategy . 47 Appendix 1: Statistical Retail Tables – Population Growth (Baseline) Appendix 2: Statistical Retail Tables – Population Growth (Jobs Baseline OBR) Employment Led

1 WYG Planning creative minds safe hands 1.0 Introduction Instruction 1.01 WYG Planning (‘WYG’) was commissioned by Lancaster City Council (LCC) in October 2015 to undertake an update to the Lancaster Retail Development Strategy (LRDS) released in January 2014. The key purpose of this update is to assist in considering both locally and nationally changes that have occurred in the retail sector since publication of the Strategy in 2014 but also to reflect the changes to the wider UK economy. 1.02 The requirements of this update including the following:  An update of the population forecasts of the baseline and employment led scenario;  An update of the retail expenditure forecasts of the baseline and employment led condition;  An assessment of the quantitative need and capacity for additional convenience and comparison retail floorspace in Lancaster that reflect the significant retail development that has since been approved in both Lancaster city centre and Morecambe.

 Consideration of the above capacity in relation to the changing position of Lancaster Canal Corridor North and delivery of the regeneration scheme and the changing dynamic of any future development; 1.03 The update is required to help influence the Canal Corridor North regeneration opportunity adjacent the city centre as a long term aspiration for both the City Council and its developer partners to deliver a retail led regeneration project to maintain Lancaster’s retail position in the sub region. The ever changing retail climate has placed a challenging environment to deliver the Canal Corridor North site and with a number of viability and deliverability matters it is consider that the Council need to review and understand future capacity to inform the emerging local development plan and the site allocation for the Canal Corridor North site.

1.04 The update will again utilise the original empirical research (shopping survey of 1,700 households), undertaken by NEMS Market Research Limited in April 2013. The Study Area is comparable to that adopted by the 2006 and 2013 Retail Studies, which covers Lancaster, parts of South Lakeland, Barrow and Eden to the north; and parts of Wyre, Ribble Valley, Preston and Craven to the south and east of Lancaster. This update also draws upon current Experian population and expenditure data

2 WYG Planning creative minds safe hands (published October and November 2015) in order to establish the up to date position with regard to both convenience and comparison goods capacity.

Structure of Report 1.05 Our report is structured as follows:  Section 2 provides a context for the Retail Study by providing an overview of key retail trends;  Section 3 sets out current and future estimated population and expenditure levels within the Study Area and builds on the same design years from the 2013 Study (i.e. 2013, 2018, 2023 2028 and 2031);  Section 4 provides our assessment of the quantitative and qualitative need for further convenience and comparison goods floorspace over the assessment period;  Section 5 considers future retail capacity based on the employment led population forecasts driven from the results of the Housing Requirements Study; and  Section 6 provides our recommendations in respect of the Council’s future retail and leisure strategy.

3 WYG Planning creative minds safe hands 2.0 Population and Expenditure 2.01 This section of the report re-assesses the current population and available expenditure (for both convenience and comparison goods) within the Study Area. The extent of the Study Area and its thirteen zones was previously identified by Figure 4.1 of the LRDS. Study Area Population 2.02 The population within each postal code sector has been calculated using Experian Micromarketer G3 data (2014 estimate, which was issued in November 2015). The baseline population data takes into consideration the findings of the recent 2011 Census release which has then been projected forward by Experian (using growth rates derived from ONS population projections) using the latest mid-year population projections from 2012 and are based on Experian’s ‘demographic component model’ which builds ONS population projects, age/gender bans and migration and death rates etc.

2.03 For the purpose of this update, population and expenditure has been calculated at five year intervals from 2013 (the base date) to 20311 in accordance with the NPPF and the previous LRDS (i.e. 2018, 2023, 2028 and 2031), and then at 2031 to reflect the future development plan timeframe. 2.04 On this basis, the defined Study Area retains a resident population of approximately 383,715 people at 2013 rising to 397,246 people at 2031. This represents an increase in population within the Study Area of 13,531 people (equating to an increase of 3.5%) between 2013 and 2031. The previous LRDS identified that the population with the Study Area would increase by circa 26,400 people between 2013 and 2031, demonstrating that the LRDS over estimated the level of population (by 12,900 persons).

Table 4.1 provides a breakdown of the ‘baseline’ forecast population change within the Study Area in the period through to 2031. The population forecasts are compared to the population forecasts contained within the LRDS (2013). In consideration of the four principal survey zones that cover Lancaster’s administrative area (Zones 1, 2, 3 and 6), the LRDS estimated that these had a population of circa 138,600 persons at 2013 and was forecast to increase to 154,700 by 2031, however, the latest forecasts show that the population will increase to 147,800 persons by 2031, representing a increase of 9,200 persons, (compared to 16,100 persons in the LRDS).

This compare to the circa 7,000 population change estimated in the SNHP 2012 which is set out in Table 4.1 of the SMHA 2015.

1 2031 is three years after 2028 but reflects the plan period

4 WYG Planning creative minds safe hands Table 2.1: Baseline Population in the Study Area (2013 to 2031) Compared to Population Estimates in the LRDS (2013) Year Study Area Population Difference in Population Estimates LRDS (2013) LRDS (2015) 2013 383,715 383,715 0 2018 390,422 389,720 -702 2023 398,166 392,399 -5,767 2028 406,156 395,977 -10,179 2031 410,161 397,246 -12,915 Source: Appendix 2, Table 1 and LRDS (2013) Appendix 1, Table 1 2.05 Table 2.1 provides a detailed breakdown of the revised ‘baseline’ forecast population change within each survey zone in each of the reporting periods to 2031.

Table 2.2: Baseline – Study Area Population by Survey Zone (2013 to 2031) Zone 2013 2018 2023 2028 2031 1 55,594 55,664 55,988 57,025 57,541 2 51,481 52,209 52,889 54,053 54,510 3 8,413 10,871 10,968 11,154 11,221 4 30,035 30,775 31,391 31,860 32,033 5 14,429 14,033 14,245 14,472 14,538 6 23,084 23,637 24,012 24,398 24,507 7 11,447 11,931 11,960 11,981 11,950 8 28,324 30,072 30,318 30,503 30,682 9 12,963 12,331 12,369 12,386 12,324 11 86,872 87,581 87,112 86,532 86,191 13 18,543 17,567 17,669 17,715 17,698 15 20,061 19,972 20,097 20,213 20,206 16 22,469 23,077 23,381 23,685 23,845 Total 383,715 389,720 392,399 395,977 397,246 Source: 2013 data derived from Experian Micromarketer G3 data Retail Expenditure 2.06 In order to calculate per capita convenience and comparison goods expenditure, WYG has utilised Experian Micromarketer G3 data which provides detailed information on local consumer expenditure which takes into consideration the socio-economic characteristics of the local population.

Experian is a

5 WYG Planning creative minds safe hands widely accepted source of expenditure and population data and is regularly used by WYG in calculating retail capacity. 3.01 The base year for the Experian expenditure data is 2013. Per capita growth forecasts have been derived from Experian Retail Planner Briefing Note 13, which was published in October 2015. Appendix 3 of the Retail Planner Briefing Note identifies the following annual growth forecasts for convenience and comparison goods which inform our assessment. The table compares the differences in the annualised growth rates adopted in the LRDS in 2011 and used for this update, it is clear from the results that the annualised growth in convenience goods was over estimated where growth of nearly 1% per annum was predicted but is now not expected to materialise over the plan period.

The results also show that the forecasts in annualised comparison goods expenditure growth is higher than previously estimated in the LRDS in 2011.

Table 2.3: Expenditure Growth Forecasts Year Convenience (%) Comparison (%) LRDS (2013) LRDS (2015) LRDS (2013) LRDS (2015) 2013 -0.6 -1.1 3.1 3.6 2014 -0.3 -2.2 3.2 4.8 2015 0.1 -0.4 2.3 4.7 2016 0.6 -0.2 2.8 2.4 2017 0.9 0.1 2.9 2.1 2018 0.8 -0.1 2.9 1.8 2019 0.9 -0.1 3.1 2.1 2020 0.9 -0.2 3.1 2.5 2021 0.9 -0.3 3.0 3.1 2022 0.9 -0.3 3.0 2.9 2023 0.9 -0.1 2.9 3.4 2024 0.9 0.0 2.9 3.4 2025 0.8 -0.1 2.9 3.2 2026 0.7 -0.1 2.9 3.1 2027 0.7 -0.1 2.8 3.3 2028 0.8 -0.1 2.9 3.1 2029 0.9 -0.1 2.9 3.3 2030 0.9 -0.1 2.9 3.4 2031 0.8 -0.1 2.9 3.3 Source: Appendix 3, Retail Planner Briefing Note 13 (October 2015) 2.07 The latest growth forecasts suggest that the recovery from the downturn in the economy is well underway, albeit growth in convenience goods expenditure will improve over the medium and long

6 WYG Planning creative minds safe hands term when compared to the current position. For convenience goods, Experian forecasts -1.1% annual growth at 2013, -2.2% at 2014 and -0.4% in 2015. Whilst there is some deviation in the rate forecast thereafter, the rate of annual convenience goods decline forecast to 2031 broadly follows - 0.1%. This decline is well below the growth levels predicted just last year demonstrating a weak growth pattern in convenience goods expenditure over the plan period. 2.08 By contrast, Experian identifies an immediate and relatively strong annual comparison growth rate of +3.6% at 2013 (previously 3.1%).

A increase in the rate of growth to +4.8% (previously 3.2%) delivered at 2014 and a anticipated increase of 4.7% in 2015 (previously 2.3%), with annual growth rates thereafter to 2031 forecast to be extremely stable, within the range +1.8% to +3.4%. The latest data shows that there is no growth in convenience goods expenditure in the short to long term and compares to higher annualised comparison goods expenditure growth.

2.09 Growth in expenditure forecast in the longer term (beyond the next ten years) should be treated with caution given the inherent uncertainties in predicting the economy’s performance over time. Assessments of this nature should therefore be reviewed on a regular basis in order to ensure that forecasts over the medium and long term are reflective of any changes to relevant available data. 2.10 Experian Retail Planner Briefing Note 13 also provides a forecast as to the proportion of expenditure which will be committed through Special Forms of Trading (SFT) (comprising ‘non-store retailing’, such as internet sales, TV shopping and so on)2 over the reporting period.

We have ‘excluded’ any expenditure which survey respondents indicated was committed via special forms of trading not spent in tangible in store facilities and instead have made an allowance derived from Experian’s recommendation.

2.11 In considering special forms of trading, it should be noted that many products which are ordered online are actually sourced from a physical store’s shelves or stockroom (particularly in the case of convenience goods). Accordingly, expenditure committed in this manner acts to support stores and should be considered ‘available’ to tangible retail destinations. 2.12 Accordingly, in order not to overstate the influence of expenditure committed via special forms of trading, our approach is based on Experian’s latest ‘adjusted’ figure (provided at Appendix 3 of its Retail Planner Briefing Note 13) which makes an allowance for internet sales which are sourced from stores.

The proportion of expenditure committed through special forms of trading cited below at 2 Defined by Experian as expenditure not directed to traditional floorspace such as the internet, mail order, party plan and vending machines and other non-store activity such as market and road side stalls.

7 WYG Planning creative minds safe hands Table 2.4 is ‘stripped out’ of the identified expenditure as it is not available to stores within the Study Area. WYG note that the estimates for Special Forms of Trading (SFT) between 2013 and 2015 have changed and Experian estimates are slightly lower than those set out in Experian Retail Planner Briefing Note 11 (October 2013). Table 2.4: Special Forms of Trading (SFT) Forecasts Year Convenience Comparison LRDS (2013) LRDS (2015) LRDS (2013) LRDS (2015) 2013 2.5% 2.2% 10.8% 10.6% 2018 3.8% 3.5% 14.5% 13.8% 2023 4.8% 4.7% 15.9% 15.1% 2028 5.4% 5.4% 16.0% 14.8% 2031* 5.6% 5.8% 15.9% 14.6% Source: Experian Retail Planner Briefing Note 13 (October 2015) 2.13 Using the revised growth rates and revised SFT allowances, it is possible to reproduce expenditure estimates for each survey zone under each population growth scenario at 2013, 2018, 2023, 2028 and 2031.

In doing so, our assessment takes into account both per capita retail expenditure growth and population change. As highlighted earlier WYG note that the above SFT forecasts are projected growth rates and it still unclear whether these will mature or stabilise over time or/at expected levels as they have already been refined over the last two years, therefore our approach is considered cautious but we would recommend given the fluidity of this growth sector that this is regularly (yearly) monitored as it may have consequences on requirement for tangible floorspace.

Convenience Goods Expenditure 2.14 Taking into consideration the above increases in population and per capita expenditure, it is estimated that, at 2013, the resident population of the Study Area generated some £793.1m of convenience goods expenditure3 this was £58.3m higher than that identified in the LRDS (2014). This is forecast to decrease to £786.3m at 2031, which represents a decrease of £5.7m (or 0.7%) between 2013 and 2031, the previous LRDS had an increase of £131.5m up to 2031. Up to 2018, the convenience goods expenditure is estimated to decrease to £783.8m, which represents a decrease of just £9.3m (-1.2%), it was previously estimated to increase by 2.5% (or £19.0m).

Table 2.5 Total Available Study Area Expenditure – Convenience (£m) 3 Expressed in 2011 prices, as is every subsequent monetary value

8 WYG Planning creative minds safe hands 2013 2018 2023 2028 2031 Growth 2013-2018 Growth 2013-2023 Growth 2013-2028 Growth 2013-2031 LRDS (2013) 734.8 753.7 794.6 837.9 866.3 19.0 59.9 103.2 131.5 LRDS (2015) 793.1 783.8 781.9 786.9 787.3 ‐9.3 ‐11.1 ‐6.2 ‐5.7 Difference +58.3 +30.0 ‐12.7 ‐51.0 ‐79.0 ‐28.3 ‐71.0 ‐109.3 ‐137.3 Source: Table 2a, Appendix 2. 2015 figures are in 2013 prices, the LRDS was in 2011 prices Main Food and ‘Top-Up’ Shopping 2.15 Similar to the LRDS it has been assumed that the proportion of convenience goods expenditure directed to each respondent’s main food shopping destination equates to 80% of their overall convenience shopping expenditure.

The remaining 20% of expenditure (which will typically be spent on regular purchases such as milk, bread and so on) is therefore attributed to the respondents’ ‘top- up’ convenience shopping destination. This ratio broadly reflects the respective expenditure committed during main food and top-up shopping trips as identified by Questions 5 and 15 of the household survey.

2.16 By applying these estimates to the identified resident population of the Study Area, convenience goods expenditure at 2013 committed through ‘main food’ shopping trips is estimated to be £634.4m (previously £603.0m in the LRDS) and through ‘top up’ shopping trips is estimated to account for £158.6m (previously £150.7m in the LRDS). Comparison Goods Expenditure 2.17 At 2013, this update estimates that the resident population of the Study Area generates £1,092.8m of comparison goods expenditure, which is forecast to increase to £1,956.8m at 2031. This represents an increase of £864.1m (or 79.0%) between 2013 and 2031.

This increase is clearly significant, it is more modest than that which has previously identified (£690.3m) due to the increased levels of annualised comparison goods growth which is now forecast over the short to medium term in particular up to 2015 which in some years was double that expected. The increase is also due to the level of expenditure assigned to SFT sales was not as high as predicted two years ago. Indeed, the identified comparison goods expenditure growth of £205.7m within the Study Area between 2013 and 2018 represents just an 18.8% increase (previously a 12.0% increase). The difference in the level of expenditure up to 2018 is significant to that previously identified whereby there is no £82.7m of extra comparison goods expenditure available to that which was previously identified in the LRDS which is reflective of the increased economic improvements experienced since 2014.

Table 2.6 Total Available Expenditure Study Area – Comparison (£m)

9 WYG Planning creative minds safe hands 2013 2018 2023 2028 2031 Growth 2013-2018 Growth 2013-2023 Growth 2013-2028 Growth 2013-2031 LRDS (2013) 1,019.8 1,142.7 1,324.4 1,556.4 1,710.0 123.0 304.6 536.7 690.3 LRDS (2015) 1,092.8 1,298.4 1,498.9 1,774.4 1,956.8 205.7 406.2 681.6 864.1 Difference +73.0 +155.7 +174.6 +218.0 +246.8 +82.7 +101.6 +145.0 +173.8 Source: Table 8, Appendix 2 figures are in 2013 prices, the LRDS was in 2011 prices 2.18 For the purposes of this study, comparison goods expenditure has been divided into eight sub- categories: ‘Furniture’, ‘DIY’, ‘Electrical’ (these four categories collectively being referred to as bulky goods), ‘Clothing & Footwear’, ‘CDs, DVDs and Books’, ‘Small Household Goods’, ‘Toys, Games, Bicycles and Recreational Goods’ and ‘Health and Beauty/Chemist Goods’ (collectively referred to as non-bulky goods).

The proportion of expenditure directed to each sub-category is estimated by Experian on a zone by zone basis.

Inflow (Visitor/Tourism) Expenditure to Lancaster 2.19 Further to the LRDS, no new further information has been made available specifically from STEAM (2012) for the district, and with Lancaster (and Morecambe) both recognised as important destinations in Lancashire’s and the North West’s wider tourism economy. We have been provided with a STEAM summary report (2014) which found that on average the number of visitor days to Lancashire has been growing by 1.4% a year since 2009 with the total number of day visitors increased by 2.3% between 2013 and 2014 and this increase was supported due to attractions such as events and festivals.

However, the summary provide no revised quantitative spend data that could be used for the purposes of this update. Therefore as a conservative approach we have sought to retain the last available expenditure figures from 2012 and adjust these accordingly. 2.20 WYG has therefore relied on the level of shopping expenditure that is attracted to the area from visitor and tourist spend from the previous STEAM data (2012). STEAM data confirms that the total ‘shopping’ expenditure by visitors in Lancaster is £159.1m in 20114 , of which £70.9m is spent on food and drink, which we understand includes eating out at destinations such as restaurants, pubs, cafes etc and £88.2m is spent on shopping.

STEAM identify that other (£60.3m) expenditure is spent in Lancaster on accommodation, recreation and transport.

2.21 The STEAM data does not break down the shopping spend into comparison or convenience goods items. In drawing on the ratio identified by Experian between convenience and comparison goods (i.e. £793.1m/£1,093.1m respectively) at 2013 WYG has assumed that around £37.0m is spent at facilities 4 STEAM data is in 2011 price base so WYG has adjusted to reflect the price base of this Statement (2013).

10 WYG Planning creative minds safe hands in the district on convenience goods with a further £51.1m spent on comparison goods retail. We have assumed that a total of around £88.2m is spent in the district as a whole, which represents an inflow of around 5.0% of all goods when compared to the £1,886.2m generated in the local area.

In terms of the level of expenditure that is currently retained and spent at existing facilities in Lancaster (£324.1m on comparison goods and £266.6m on convenience goods = £590.7m) then this figure represents circa 15% of the trade secured in the district.

Market Share of Expenditure of Main Facilities 2.22 Having re-estimated the level of expenditure which is generated by the resident population within the defined Study Area, it is necessary to identify the ‘sphere of influence’ of each of the town and district centres through consideration of each centre’s claimed market share of available expenditure. We have also re-assessed the market share claimed by the major retail parks (this latter category effectively being ‘undefined’ in planning terms).

2.23 As previously explained this update has drawn from the results of the 1,700 household telephone interviews within the defined Study Area.

By analysing the results from the survey, it is possible to re- estimate the levels of expenditure which are directed towards each principal centre’s shopping facilities. The market shares for the various expenditure categories were identified in Section 4 of the LRDS and we have not updated these as the market shares are based on trips identified in 2013. For this update, WYG has removed allowances to SFT. Table 5.6 below sets out the differing market shares achieved for each of the main retail destinations across the district, and shows that the main destinations for undertaking shopping trips is Lancaster city centre, followed by Morecambe town centre.

The third most popular destinations are facilities at Central Drive in Morecambe. Joint fourth is Bulk Road Retail Park and Lancaster City Retail Park (Morecambe) with 1.8% market share. Facilities in Carnforth retained just 0.7% of all expenditure spend. The network of local centres (Heysham, Bolton le Sands, Torrisholme, Caton, and West End) when considered together are the least most popular destinations in the district. The results clearly show that the level of clothing and footwear retention in Lancaster is the lowest of all the goods categories examined. The cumulative market share figures is slightly different to those within the LRDS due to the changes in expenditure allocations to that previously considered in the LRDS.

2.24 Overall the facilities within the district retain approximately 31.3% (previously 33.1%) of all local expenditure generated in the Study; this is considered a healthy and sustainable level given the extent of the Study Area (covering south Cumbria), demonstrating that there is limited outflow of expenditure from the core zones.

11 WYG Planning creative minds safe hands Table 2.7: Lancaster District Market Shares by Location Destination Market Shares by Category (%) Convenience Goods Comparison Goods Main Food Top-up Food Furniture DIY Electrical Clothing & Footwear CDs, DVDs, books Small Household Recreation Chemist TOTAL^ Lancaster City Centre 7.2 8.4 9.8 8.4 17.0 18.2 26.5 15.9 21.6 18.8 9.5 Morecambe Town Centre 1.0 2.1 8.0 8.9 4.6 2.8 3.0 5.1 5.9 6.2 2.8 Carnforth Town Centre 1.0 1.8 0.0 0.4 0.0 0.0 1.4 0.2 0.5 2.6 0.7 Local Centres 0.3 5.0 1.3 0.6 0.2 0.0 0.1 0.1 0.0 0.6 0.6 Lancaster City Retail Park - - 5.6 1.9 0.1 0.7 0.0 2.8 0.2 0.0 1.8 Bulk Road Retail Park - - 4.4 7.6 11.7 1.1 0.3 2.4 1.2 0.9 1.7 Central Drive, Morecambe 8.7 3.2 0.9 3.2 0.1 0.2 0.4 0.6 0.0 0.3 2.5 Other (undefined) 25.9 18.6 5.4 5.4 5.5 4.4 10.0 7.4 3.6 8.4 11.7 District Sub-Total 37.5 35.6 35.6 36.5 39.3 27.6 41.8 34.4 33.0 37.8 31.3 Source: Lancaster Household Shopping Survey (2013) ^ Based on cumulative market share of all categories (convenience goods and comparison goods) In 2013 prices Forecast Growth in Expenditure Attracted to Study Area 2.25 With forecast growth in convenience goods expenditure predicted to decrease at an average of -0.3% per annum5 across the whole of the period from 2013 to 2031, it is estimated that the Study Area will experience a decrease in convenience goods expenditure of approximately £5.7m at 2031.

Assuming a constant ‘Study Area’ market share of 33.7%, this equates to a decrease (within the district) in retained convenience goods expenditure of approximately -£1.9m at 2031. 2.26 The significant forecast increase in expenditure on comparison goods (an average of 3.3% per annum29 increase in the period 2013 to 2031) (previously 2.5% per annum) would result in a further £864.1m of comparison goods expenditure being generated within the Study Area by 2031 (previously £690.3m). Assuming a constant comparison goods market share of 29.6%, existing facilities within 5 Growth rates taken from Appendix 3 of Experian Retail Planner Briefing Note 13 (October 2015), and are adjusted to take into consideration SFT allowances.

12 WYG Planning creative minds safe hands Lancaster will capture around an additional £255.8m (previously £211.4m in the LRDS) of comparison goods expenditure by 2031. 2.27 This analysis is based on ‘rolling forward’ the current market share within the Study Area for each category of goods. This approach of rolling forward existing market share is in line with standard practice and does not take into account the desirability or need to ‘claw back’ leakage between expenditure directed to centres elsewhere, which might be achieved through improvements in retail provision.

2.28 In order for the Study Area to capture the significant future growth in retail expenditure which is forecast (particularly for comparison goods), it is likely that there will be a need to enhance future retail provision, thereby ensuring that this growth is not lost to competing centres and that the Study Area retention rate does not decline in the future.

2.29 If an excess of comparison or convenience goods expenditure manifests itself within the Study Area, this does not necessarily translate directly into a requirement for additional floorspace. In assessing quantitative need, it is also necessary to take account of:  Existing development proposals;  Expected changes in shopping patterns; and  The current capacity and efficiency of retail floorspace within the established centres.

13 WYG Planning creative minds safe hands 3.0 Capacity in Existing Centres 3.01 WYG has re-examined the need for new convenience and comparison goods floorspace over five year reporting periods to 2028, and then to 2031 to coincide with the lifespan of the emerging Local Plan. At the outset and as demonstrated from the shift in retail expenditure levels since the preparation of the LRDS (2014), it is important to note that an assessment in the long term should be viewed with caution, due to the obvious difficulties inherent in predicting the performance of the economy and shopping habits over time.

In any event, any identified need or capacity identified beyond 2018 should not necessarily be viewed as justification of new retail floorspace outside of centres as this could prejudice the implementation of any emerging town centre redevelopment strategies and the development of more central sites which may be currently available or which could become available over time.

3.02 A complete series of revised quantitative capacity tables are provided at Appendix 1 and 2 to provide further detail in terms of the step-by-step application of the study methodology. Capacity Formula 3.03 For all types of capacity assessment, the conceptual approach is identical, although the data sources and assumptions may differ. The key relationship is Expenditure (£m) (allowing for population change and retail growth) less Turnover (£m) (allowing for improved ‘productivity’) equals Surplus or Deficit (£m).

3.04 Expenditure (£m) – The expenditure element of the above equation is calculated by taking the population within the defined catchment and then multiplying this figure by the average annual expenditure levels for various forms of retail spending per annum.

The expenditure is estimated with reference to a number of factors, namely:  Growth in population;  Growth in expenditure per person per annum; and  Special Forms of Trading (e.g. catalogue shopping / internet). 3.05 Turnover (£m) – The turnover figure relates to the annual turnover generated by existing retail facilities within the Study Area. The turnover of existing facilities is calculated using Mintel Retail Rankings and Verdict UK Grocery Retailers reports – independent analysis which lists the sales density for all major multiple retailers.

14 WYG Planning creative minds safe hands 3.06 Surplus / Deficit (£m) – This represents the difference between the expenditure and turnover figures outlined above. Clearly, a surplus figure will suggest an under provision of retail facilities within the Study Area (which, all things being equal, would suggest that additional floorspace is required), whereas a deficit would suggest an over provision of retail facilities (and in these circumstances it would prove difficult to justify additional floorspace).

3.07 Although a surplus figure is presented in monetary terms, it is possible to convert this figure to provide an indication of the quantum of floorspace which may be required to meet identified needs.

The level of floorspace will vary dependent on the type of retailer proposed and the type of goods traded. For example, electrical retailers such as Currys (which is considered a bulky goods retailer) have a much higher sales density than other bulky goods retailers such as B&Q, and clothing and footwear (non-bulky goods) operators generally have a higher sales density than bulky goods retailers. Future Capacity for Convenience Goods 3.08 In order to ascertain the likely need for additional convenience goods floorspace for Lancaster, it is first necessary to consider the current provision.

For each centre, it is assumed that future expenditure available to the centre will be based upon its existing market share. Given that the district is already relatively well provided for with a variety of foodstore operators, it is assumed that the future convenience goods expenditure available to Lancaster will be commensurate to its current market share of 33.7%. This current market share is calculated by examining the trading performance of stores in the wider Study Area.

3.09 The analysis of the market share of facilities in Lancaster indicates that the current level of trade at 2013 passing through food facilities originating from inside the Study Area is £266.9m. For each identified convenience goods destination, we have made a judgement as to whether any additional expenditure is likely to be attracted from outside the Study Area. We have considered this ‘inflow’ on a case by case basis, having regard to the size of the store, its operator and its position within Study Area but also the level of tourist spend identified by STEAM and its wider overall tourism offer.

3.10 We estimate that, taken as a whole, approximately £37.0m is estimated to be attracted to convenience retail facilities from outside the Study Area, taking the total expenditure spent at existing facilities within the district to £303.9m (previously this was identified at £296.6m). 3.11 For each destination, the survey-derived turnover is compared to a ‘benchmark’ turnover that indicates the level of turnover that the store would generally be expected to attract, based on company average

15 WYG Planning creative minds safe hands trading levels. A judgement can then be made on the trading performance of existing facilities based on the comparison of the survey-derived turnover with the expected turnover of the existing provision. 3.12 Tables 3.1 and 3.2 indicate the current trading position compared against the ‘benchmark’ (or anticipated) turnover of existing convenience goods floorspace and project this forward to 2031 assuming that the identified market share remains constant. The ‘benchmark’ turnover differs for each operator based on its average turnover per square metre (or ‘sales density’) throughout the country.

Although robust up to date information is available in terms of the convenience goods floorspace provided by large foodstores, it can be more difficult to quantify the extent of local convenience provision as there is no single comprehensive database to rely upon. Where WYG have been unable to verify the exact quantum of floorspace provided by existing smaller-scale convenience stores, we have assumed that stores are trading ‘at equilibrium’ (i.e. the survey-derived turnover equates to the expected level of turnover).

3.13 Furthermore, as this assessment is based upon a ‘goods based’ approach (which disaggregates expenditure by category type) it is important to recognise that major foodstore operators generally sell an element of non-food goods such as books, compact discs, clothing and household goods. To account for this, the typical ratio between convenience/comparison goods provision for each operator6 has been applied to the estimated net floorspace of each foodstore. This provides an indication of the likely sales area dedicated to the sale of convenience goods at each store. 3.14 Whilst survey results are commonly accepted as a means by which to identify existing shopping patterns, their findings should be treated with a ‘note of caution’ as they tend to have a bias towards larger stores and understate the role of smaller stores and independent retailers.

3.15 Our assessment identifies that, across the main convenience goods provision considered together, the expected benchmark turnover of existing convenience goods shopping provision is £291.4m per annum at 2013, which is below the survey-derived turnover (plus inflow) of £303.9m per annum. The derived figure allows for inflow in the manner previously identified. This suggests that, cumulatively, convenience goods floorspace is effectively ‘over trading’ by £12.5m (previously £33.5m in the LRDS). Whilst overall the trading performance of existing provision appears to be satisfactory, there are instances where certain facilities trade either particularly well or relatively poorly.

For example, the new results show that facilities in Zone 1 (Lancaster) are now trading with a benchmark turnover of £136.3m and is comparable to the survey derived turnover of £136.6m (including inflow); whereas facilities in Zone 2 (Morecambe) claim around £15.5m more than the benchmark turnover of £122.6m. Similarly, in Zone 6 (Carnforth), the survey identifies that facilities have an estimated turnover of 6 Taken from Verdict Food & Grocer Retailers (2012)

16 WYG Planning creative minds safe hands £31.2m, which compares to an expected benchmark of £29.1m, so overtrading by £2.1m (previously estimated to be overtrading £6.5m). The results show that the changes to the economic information available shows that existing facilities in Lancaster and Carnforth are not as over trading as previously identified in the LRDS and are trading at expected levels with a degree of variance, however the results still show that there is still over trading occurring at Morecambe. 3.16 Accepting the caveat provided at paragraph 3.14, the survey indicates that a number of stores are performing particular well in and around the main three main city/town centres.

In particular facilities in Zone 1 (Lancaster) including the edge of centre Sainsbury’s store on Cable Street, the out of centre Asda at Ovangle Road, the Aldi at Morecambe Road and the Booths at Hala Road are all overtrading but not to the level previously found. As before, other stores, mainly located in the city centre are trading below expected benchmark levels including. Overall facilities in Zone 1 are now trading at expected benchmark levels.

3.17 As in the LRDS the results show contrasting performances at different stores in Zone 2 around Morecambe. In the town centre, facilities are not trading well with the Iceland which is performing below expected levels and since (April 2015) the LDRS (2013) the Tesco Metro in the Arndale Centre has closed and is to be re-occupied by Home Bargains. Out-of-centre facilities also show a mixed trading performance, with the Aldi at Marine Road West trading at expected levels, the Asda at Lancaster Road and the Morrisons at Central Drive all trading higher than expected benchmark levels. However, Sainsbury’s at Lancaster Road is trading at around 72% of expected levels.

As before, Heysham and Torrisholme local centres are trading at expected levels whilst facilities in the West End is perform well below expected benchmark levels. When considering the collective performance we found that generally existing facilities are trading above expected levels (+15.5m). The closure of the Tesco Metro may have implications on the other stores in the vicinity and this will need to be monitored in due course.

3.18 In terms of Zone 6 (Carnforth), the results show that facilities in the town centre (Co-operative Food and Booths) are cumulatively trading at around 80% of expected levels, with the Tesco at Lancaster Road still trading well above expected benchmark levels. 3.19 The individual performance of each of the main convenience goods facilities are identified at Table 5 of Appendix 2. It should be noted that, although the level of trading in some cases is high, such trading performances are not uncommon and will occur at numerous stores operated by the ‘leading five’ supermarket retailers and also at successful ‘discounted’ stores.

17 WYG Planning creative minds safe hands 3.20 In order to appraise the need for additional convenience goods retail floorspace, it is necessary to consider how this collective overtrading may be affected by future growth in expenditure. Accordingly the next series of tables set out the anticipated increases in expenditure which will be available to the district’s convenience goods retail facilities, assuming that the current market share is maintained. It is also assumed that the turnover of existing floorspace will improve through improvements in floorspace efficiency as set out in Experian Retail Planner 13.

Following this exercise, we then consider the effect extant planning commitments will have in addressing any identified convenience shopping needs.

Convenience Goods Quantitative Need in Lancaster (District Wide) – Baseline 3.21 Table 3.1 indicates that, through increases in both population and expenditure applied to the current trading position and inclusion of inflow from beyond the Study Area, there is a convenience goods expenditure surplus of £15.0m at 2013. By 2018 after increase population and expenditure figures coupled with increases in productivity, we estimate that there will be a surplus expenditure of £19.4m at 2018, decreasing slightly to £18.7m at 2023, up to £20.4m at 2028 and £20.6m by 2031 (based on the revised market share (33.7%) being retained).

Table 3.1: Baseline – Quantitative Need for Convenience Goods Floorspace in Lancaster District Year Benchmark Turnover (£m) Available Derived Expenditure (£m) Surplus Expenditure (£m) 2013 288.9 303.9 15.0 2018 280.3 299.7 19.4 2023 280.3 299.0 18.7 2028 280.3 300.7 20.4 2031 280.3 300.9 20.6 Source: Table 6 (Table 1a) Appendix 2 2013 prices Table 3.2: Baseline: Quantitative Need for Additional Convenience Goods Floorspace in Lancaster District – After Commitments Year Convenience Goods £m Floorspace Requirement (sq.m net) Surplus (Taken from 3.1) Implemented Residual Min Max 2013 15.0 10.6 1.8 142 368 2018 19.4 8.8 10.6 800 2,200 2023 18.7 8.8 10.0 800 2,100 2028 20.4 8.8 11.6 900 2,400 2031 20.6 8.8 11.8 900 2,400 Source: Table 6 (Table 1c) of Appendix 2 In 2013 prices

18 WYG Planning creative minds safe hands 3.22 WYG understands that since completion of the LRDS a number of planning permissions have been implemented totalling 952 sq.m (net) of convenience good floorspace proposed across the district, including the extension of the Aldi store at Morecambe Road in Lancaster (Zone 1) and the building of the Aldi store at Scotland Road in Carnforth (Zone 6). WYG estimates that the proposed floorspace will have a turnover of £9.5m once all are trading at 2018, and we estimate that £9.1m of this will be derived from the Study Area. As shown in Table 3.2, implemented permissions effectively absorb circa 45% of the expenditure capacity identified (£8.8m of £19.4m) at 2018; and, a need for between just 800 sq.m and 2,200 sq.m of additional convenience goods floorspace by 2018 is required.

Given the limited expenditure and population growth this is expected to increase to between 900 sq.m and 2,200 sq.m between 2028 and 2031. We have also assumed that the previously identified turnover derived at the Tesco Metro will be transferred to the Home Bargain store in the Arndale Centre once trading although it is unlikely to trade at the levels achieved by Tesco Metro. 3.23 In addition, there are a number of extant planning permissions for additional convenience goods floorspace in the district, which have a combined net floorspace of 3,907 sq.m across three schemes The largest extant development as identified in the LRDS is the new replacement Booths store at Scotforth Road with a net sales of circa 1,850 sq.m, which is a replacement foodstore for their Hala Road store.

As with the LRDS we also have assumed that the existing Booths store will be re-occupied by a discount retailer7 . There is also a CLUED for the existing B&Q store on Aldcliffe Road in Lancaster to be used for a foodstore, although the B&Q is still trading at the time of this Study update.. Table 3.3 below show the need for further convenience goods development in the district taking into account the implemented and extant convenience goods floorspace.

3.24 The majority of any capacity will be absorbed by five extant planning permission which includes one new major supermarket (namely the Booths at Scotforth Road) in Zone 1 (planning permission reference 10/00251/FUL), which is a replacement foodstore for their Hala Road store. We also have assumed that the existing Booths store will be re-occupied by a discount retailer8 . There is also a CLUED for the existing B&Q store on Aldcliffe Road in Lancaster to be used for a foodstore, although the B&Q has still remained trading for three years seen approved and WYG believe that there are question marks whether this will ever be implemented but have still treated this as a commitment for the purposes of this update.

7 WYG has assumed that there will be a full transfer of trade of the existing Booth store (Hala Road) to the new store, as a like- for-like replacement (albeit larger) and the existing store will be re-occupied by a discount retailer. 8 WYG has assumed that there will be a full transfer of trade of the existing Booth store (Hala Road) to the new store, as a like- for-like replacement (albeit larger) and the existing store will be re-occupied by a discount retailer.

19 WYG Planning creative minds safe hands Table 3.3: Net Quantitative Need for Convenience Goods Floorspace in District – Extant Planning Consents Year Convenience Goods £m Floorspace Requirement (sq.

m net) Residual (Taken from 3.2) Extant Residual Min Max 2013 1.8 2018 10.6 19.9 -9.3 -700 -1,900 2023 10.0 19.9 -9.9 -800 -2,000 2028 11.6 19.9 -8.2 -700 -1,700 2031 11.8 19.9 -8.1 -600 -1,700 Source: Appendix 2, Table 6 (Table 2c) Planning commitments within LCC provided by LCC Council. 3.25 Table 3.3 show that once the implemented convenience goods retail developments and extant planning consents are taken into account, there would be a deficit in convenience goods expenditure available at 2018 of -£9.3m. By 2023, there would remain a surplus of -£9.9m convenience goods expenditure, decreasing to -£8.2m at 2028 and -£8.1m at 2031.

WYG hold reservations on whether the B&Q store on Aldcliffe Road will be converted to a foodstore; however, even if this was removed from the capacity estimates there would still be very limited capacity over the plan period beyond existing implemented and extant planning permissions. Therefore, it is evident that in the short term (up to 2018) there is no capacity to support additional convenience goods floorspace. 3.26 WYG recommends that the Council carefully monitor the implementation of extant planning permissions and the performance of the Home Bargains in Morecambe over the next five years and review how if implemented these influence existing shopping patterns moving forward through the next review as these results show given the structural changes in the convenience goods market then changes can occur quickly.

Convenience Goods Quantitative Need in Lancaster Urban Area (Zone 1) 3.27 As with the previously LRDS we have re-appraised the need for additional convenience goods retail floorspace in the main urban area around Lancaster, we have considered the trading performance of existing facilities in Zone 1 which forms the main urban area around Lancaster. The area includes facilities that are located in and around Lancaster city centre, as well as other undefined locations (including ‘standalone’ edge and out of centre stores and local parades). As set out in the LRDS the results show that existing facilities in the Zone 1 retain 79.7% of the available main food expenditure and 89.9% of top up food expenditure generated within the Study Area, this is considered strong and

20 WYG Planning creative minds safe hands with improvements to the existing Aldi store then this may improve retention further in Zone 1. AS before there is very limited lose of main and top up trade to facilities outside the district. 3.28 Drawing on information contained in Table 5 of Appendix 2 and identified earlier in this section, it is evident that convenience goods facilities within Zones 1, when considered together, are trading at expected levels, with a benchmark turnover of £136.3m at 2013, compared to a survey-derived turnover of £134.9m. The survey-derived figure allows for inflow (£19.5) in accordance with STEAM estimates.

The update shows that given wider availability of expenditure, existing facilities in Zone 1 that were once over trading (cumulatively) (by £7.4m) are now trading at expected levels, but more interesting are trading at a higher level to that identified in the LRDS (£136.6m compared to £131.4m).

3.29 Table 3.4 indicates that, at 2013, an expenditure surplus of +£1.6m (previously £7.4m) (above the expected benchmark turnover) is attributed to facilities in the Lancaster Urban Area. This surplus derives from the overtrading mainly driven by the significant over trading experienced at the edge-of- centre and out-of-centre stores, which then masks the under-performing stores in the city centre. The results also indicate that the trading performance of convenience goods facilities in Lancaster city centre (Zone 1) is below expected benchmark levels. Facilities in Lancaster have a convenience goods market share of 14.8% in the Study Area (previously 15.2%), which represents 43.8% of the retained expenditure in the district as a whole.

As before this coupled with relative high retention levels of main food (79.7%) and top up food (89.9%) trips with most of the other trade retention being spent at facilities in Zone 3 (Morecambe). We also note that 55% of Lancaster’s facilities derived turnover (£75.3m of £136.6m) is derived from its primary catchment area (Zone 1), 11% is drawn from Zone 2, 8.5% from Zone 3, 3.8% from Zone 5 and 3.5% from Zone 6 and 14.3% as a result of inflow from beyond the Study Area. In total 78% of Lancaster’s facilities draw is from Zones 1, 2, 3 and 6. Table 3.4: Quantitative Need for Convenience Goods Floorspace in the Lancaster Urban Area Year Benchmark Turnover (£m) Available Derived Expenditure (£m) Surplus Expenditure (£m) 2013 134.9 136.6 1.6 2018 130.9 134.6 3.7 2023 130.9 134.3 3.4 2028 130.9 135.1 4.2 2031 130.9 135.1 4.2 Source: Table 6 (Table 2a) Appendix 2 In 2011 prices 3.30 Table 3.5 provides a breakdown of the capacity for additional convenience goods floorspace in monetary terms.

Assuming existing convenience goods facilities maintain their existing market share

21 WYG Planning creative minds safe hands at 14.8%. After taking into account floorspace efficiencies, it is assumed that this surplus will increase to £3.7m at 2018, decreasing to £3.4m at 2023, to increasing £4.2m at 2028 and 2031. This needs to be considered in the context of £31.7m identified up to 2031 in the LRDS, demonstrating that there is a significant reduction in any identified capacity. Table 3.5: Quantitative Need for Additional Convenience Goods Floorspace in Lancaster Urban Area –After Commitments Year Convenience Goods £m Floorspace Requirement (sq.m net) Surplus (taken from Table 3.4) Implemented Residual Min Max 2013 1.6 2018 3.7 1.2 2.5 200 500 2023 3.4 1.2 2.3 200 500 2028 4.2 1.2 3.0 200 600 2031 4.2 1.2 3.0 200 600 Source: Table 6 (Table 2c) of Appendix 2 In 2011 prices 3.31 With new convenience good floorspace implemented since the LRDS in and around the Lancaster Urban Area (Zone 1) this will have absorbed some of the identified capacity.

We estimate that the implemented floorspace would have a benchmark turnover of £1.2m if trading at 2018, of which all would be derived from Zone 1 from the Study Area. As shown in Table 3.5, after allowing for implemented planning permissions, it will absorb most of the surplus capacity leaving a residual capacity of £2.5m and therefore there is very limited identifiable quantitative need for further convenience goods development up to 2018, based on the existing market share being maintained. At 2023, the identified residual will decrease to £2.3m will support limited additional convenience goods floorspace 200 sq.m to 600 sq.m net), with limited capacity identified (£3.0m) after 2028 but this should be reviewed again in 5 years time.

Table 3.6: Net Quantitative Need for Convenience Goods Floorspace in Lancaster Urban Area (Zone 1) – Extant Planning Consents Year Convenience Goods £m Floorspace Requirement (sq. m net) Residual (Taken from 3.5) Extant Residual Min Max 2013 2018 2.5 15.5 -13.0 -1,000 -2,700 2023 2.3 15.5 -13.2 -1,000 -2,700 2028 3.0 15.5 -12.5 -1,000 -2,600 2031 3.0 15.5 -12.4 -1,000 -2,600 Source: Appendix 2, Table 6 (Table 2c)

22 WYG Planning creative minds safe hands Planning commitments within LCC provided by LCC Council. 3.32 Table 3.6 show that once the implemented convenience goods retail developments and extant planning consents are taken into account, there would be a deficit in convenience goods expenditure available at 2018 of -£13.0m.

By 2018 and this deficit would occur across the plan period to 2031 therefore negates the need to plan for any new convenience goods floorspace in Zone 1. As previously advised, most of the capacity is absorbed by the new Booths store at Scotforth Road and the re-occupation of its existing store at Hala Road, as well as the re-occupation of the existing B&Q store at Aldcliffe Road. As identified earlier WYG has reservations whether the B&Q will be released for a foodstore and this would reduce the level of extant expenditure by £12.8m which would reduce the deficit surplus to -£5.5m by 2018.

In light of both implemented and existing planning commitments, WYG recommend that shopping patterns are further reviewed subsequent to the implementation of the new Booths store at Scotforth Road (and reoccupation of Hala Road store) to assess if the new facilities change patterns of convenience goods shopping in the area and to see if this increases local trade retention in Zone 1 and reduce the overtrading experienced at existing facilities in Zone 2 and create a more balanced and equitable distribution of shopping patterns in the district. The results show that beyond these current commitments there is no quantitative requirement to positively plan further new convenience goods expenditure in Lancaster urban area.

Convenience Goods Quantitative Need in Morecambe (Zone 2) 3.33 Table 3.7 sets out Morecambe’s survey derived convenience goods turnover £130.5m (previously £131.4m in the LRDS) and compares this within the expected collective benchmark turnover (£121.4m) of the existing provision, indicating that existing facilities are overtrading by £9.0m. This is a significant reduction in the overtrading that was found in the LRDS which identified that facilities in Morecambe were over trading by £18.4m. Due to more reliable data on the sales densities for Aldi which reflects their strong trading performance the results show that the store is not trading as significantly over their expected levels as considered previously.

The cumulative over trading now results from the significant over trading occurring at the Asda at Lancaster Road and the Morrisons at Central Drive, which together with the Aldi store are overtrading by £26.7m alone (whilst the new Sainsbury’s at Lancaster Road is under trading by £9.4m). The market share of the facilities in Morecambe is 14.5% (previously 15.8% in the LRDS) from the Study Area and is comparable to that achieved in Zone 1 (14.8%). Our methodology assumes that 14% of the turnover of the shops in Morecambe will be derived from outside the Study Area.

3.34 Based on this overtrading, there is currently an expenditure surplus of £9.0m (previously £18.9m) identified at 2013, which increases to £10.8m at 2018, increasing to £10.6m at 2023, £11.3m at 2028 and £11.4m at 2031.

23 WYG Planning creative minds safe hands Table 3.7: Quantitative Need for Convenience Goods Floorspace in Morecambe Year Benchmark Turnover (£m) Available Derived Expenditure (£m) Surplus Expenditure (£m) 2013 121.4 130.5 9.0 2018 117.8 128.6 10.8 2023 117.8 128.4 10.6 2028 117.8 129.1 11.3 2031 117.8 129.2 11.4 Source: Table 6 (Table 3a) Appendix 2 In 2013 prices 3.35 As with the LRDS there are no planning commitments for new convenience goods retailing in Morecambe, however as set out in Table 3.7, and based on existing trade draw of existing facilities, we have assumed that some of the turnover of proposed developments in Zone 1 will be derived from residents in Zone 2.

We therefore estimate that of the implemented floorspace that has been built since the LRDS was completed £0.9m will be derived from residents in Zone 2 at 2018. This would absorb 8% of the identified capacity based on the retention of Morecambe’s existing market share WYG believe that new convenience provision in Lancaster (Zone 1) will help to reduce the over trading that occurs in Zone 2 as residents in Zone 1 shop at these new facilities in Zone 1, therefore the identified capacity will be reduced. As set out in the LRDS we also believe that as the trading performance of the Sainsbury’s store matures it will reduce any over trading over time and we would therefore recommend that these figures be reviewed.

3.36 As shown in Table 3.8, after taking account of implemented planning permissions there is a surplus capacity of £10.0m at 2018 for new convenience goods floorspace in Morecambe; this could accommodate between 800 sq.m and 2,100 sq.m (net), based on the existing market share being maintained. At 2023, the identified residual will decrease to £9.7m and will support 800 sq.m to 2,000 of additional convenience goods floorspace, and the increased residual of £10.5m at 2031 will support 800 sq.m to 2,200 sq.m. As explored earlier, we expect that the Sainsbury’s stores trading performance will mature over the next 5 years and coupled with improved facilities in Zone 1 will reduce the over trading currently found and therefore there is likely to be less capacity over the next 5 years and this position should be monitored.

24 WYG Planning creative minds safe hands Table 3.8: Quantitative Need for Additional Convenience Goods Floorspace in Morecambe Year Convenience Goods £m Floorspace Requirement (sq.m net) Surplus Implemented Residual Min Max 2013 9.0 2018 10.8 0.9 10.0 800 2,100 2023 10.6 0.9 9.7 800 2,000 2028 11.3 0.9 10.4 800 2,100 2031 11.4 0.9 10.5 800 2,200 Source: Table 6 (Table 3c) of Appendix 2 In 2013 prices 3.37 Despite there being no extant planning permission in Zone 2, WYG expect that other extant permissions located in other Zones will have an influence on the future capacity of Zone 2. For example we expect that £4.0m of expected turnover of extant planning permissions in Zone 1 and 6 will be diverted from existing facilities in Zone 1 and therefore seek to address the current over trading occurred in this Zone as improved retail facilities are implemented.

We expect £4.0m of turnover of extant planning permissions to absorb most of the residual surplus at 2018 leaving a residual capacity of £6.0m which could accommodate between 500 sq.m and 1,200 sq.m (net). Table 3.9 shows that the capacity will increase to £6.5m but could accommodate a comparable amount of floorspace (500 sq.m (net) to 1,300 sq.m (net)) by 2031. Notwithstanding this level of identified capacity, WYG would recommend that no further convenience floorspace is actively pursued in Morecambe until existing planning permission are implemented in Zone 1 and there is no discernible issue with residents access to convenience goods facilities.

Table 3.9: Net Quantitative Need for Convenience Goods Floorspace in Morecambe (Zone 2) – Extant Planning Consents Year Convenience Goods £m Floorspace Requirement (sq. m net) Residual (Taken from 3.8) Extant Residual Min Max 2013 2018 10.0 4.0 6.0 500 1,200 2023 9.7 4.0 5.7 500 1,200 2028 10.4 4.0 6.5 500 1,300 2031 10.5 4.0 6.5 500 1,300 Source: Appendix 2, Table 6 (Table 3c) Planning commitments within LCC provided by LCC Council. Convenience Goods Quantitative Need in Carnforth (Zone 6)

25 WYG Planning creative minds safe hands 3.38 Table 3.10 (updates Table 6.8 of the LRDS) sets out Carnforth’s collective survey derived convenience goods turnover £31.2m) (previously £29.5m in the LRDS) and compares this within the expected collective benchmark turnover of £29.1m (previously £22.9m) of the existing provision, showing that existing facilities are trading at about expected levels albeit slightly higher.

However, the latest results show that he out-of-centre Tesco at Lancaster Road is still overtrading but not to the level previously identified (£4.7m compared to £9.9m) facilities in the town centre are now trading at about 80% of expected benchmark levels (previously 75%).

Table 3.10: Baseline Quantitative Need for Convenience Goods Floorspace in the Carnforth (Zone 6) Year Benchmark Turnover (£m)1 Available Derived Expenditure (£m)2 Surplus Expenditure (£m) 2013 29.1 31.2 2.1 2018 28.3 31.9 3.5 2023 28.6 31.8 3.2 2028 29.0 32.0 3.0 2031 29.3 32.0 2.8 Source: Table 6 (Table 3a) Appendix 2 2013 Prices 3.39 Based on this overtrading, there is currently an expenditure surplus of £2.1m identified at 2013, increasing to £3.5m by 2018, to £3.2m by 2023, to £3.0m by 2028 and to £2.8m by 2031. This allows for an inflow of 3.6% of turnover from outside the Study Area.

3.40 As previously identified, since the LRDS was completed Carnforth has seen the new Aldi store at Scotland Road implemented with a 1,435 sq.m (gross) store, which comprises a net floorspace of circa 790 sq.m.

As set out in Table 3.11, and based on existing trade draw of existing facilities, we have assumed that the new store will absorb any capacity and address the over trading found in Zone 6, the Aldi store is likely to help claw back expenditure currently spent at facilities in Zone 2 and lead to the increase in the market share from 3.8% to 4.5% over time. WYG estimate that the proposed store will negate any of the previously identified capacity. There are no other extant planning permissions in Zone 6 although we expect some of the local capacity may be absorbed by further improvement to convenience goods provision in Zone 2.

26 WYG Planning creative minds safe hands Table 3.11: Quantitative Need for Additional Convenience Goods Floorspace in Carnforth (Zone 6) – After Commitments Year Convenience Goods £m Floorspace Requirement (sq. m net) Surplus Implemented Residual Min1* Max2* 2013 2.1 2018 3.5 6.7 -3.2 -300 -700 2023 3.2 6.8 -3.6 -300 -700 2028 3.0 6.9 -3.9 -300 -800 2031 2.8 7.0 -4.2 -300 -900 Table 6 (Table 2c) of Appendix 2 At 2011 prices 3.41 As with the LRDS WYG recommend that local shopping patterns are reviewed in 2018, to ascertain whether the introduction of the store has helped address the overtrading experienced at the Tesco store at Scotland Road, but will also ascertain whether it has reduced the level of residents in Zone 6 from travelling to facilities in Zone 2 and subsequently reduce the over trading of such facilities in Zone 2.

Beyond the implemented Aldi store WYG do not recommend that the Council need to positively or actively plan for new foodstore provision in Zone 6 or more specifically Carnforth over the plan period.

3.42 In considering convenience goods shopping patterns in the Study Area, it is of some relevance to compare the percentage of overall journeys attracted to the zones located in Lancaster with the percentage of the Study Area population that reside in these zones. In this regard, Experian MMG3 data indicates that the population of Zones 1, 2, 3 and 6 (which cover Lancaster) at 2013 is 138,570. The population of the zones in Lancaster equates to 36.1% of the overall 2013 Study Area population of 383,715. Accordingly, it might be expected – given that shoppers typically seek to use food shopping facilities close to home – that food retail facilities located in Zones 1, 3, and 6 would gain a broadly similar market share of overall trips.

3.43 In this regard, the household survey indicates that those parts of the Study Area which are part of the Lancaster administrative area secure a market share of 37.5% of all main food shopping trips that originate within the Study Area. Accordingly, Lancaster secures more main food shopping trips than we might expect. However, this is a consequence of the strong provision of large food superstores across the district and in the three principal settlements (Lancaster, Morecambe and Carnforth). 3.44 Clearly, the drawing of local authority boundaries is largely immaterial to customers making decisions about where to shop.

Accordingly, given the high retention level shows that the district has a wider

27 WYG Planning creative minds safe hands sphere of influence and shows that these are accessible to residents beyond the district, the market share secured by facilities in Lancaster is considered to be favourable and helps draw more people to the district which may also relate to peoples travel to work patterns and therefore have a wider benefit to the district’s facilities. 3.45 In respect of top up food shopping, facilities in Lancaster secures a market share of 35.6% of all top- up food shopping trips that originate within the Study Area. Accordingly, the market share for this type of shopping trip is marginally below the proportion of the Study Area population which is accommodated within Zones 1, 2, 3 and 6.

Notwithstanding this, the market share is considered to be reasonable although there could be some scope for improvement in light of the higher main food market share.

Future Capacity for Comparison Goods 3.46 As identified in the LRDS, the three principal centres of Lancaster, Morecambe and Carnforth contain a wide range of comparison goods floorspace, including both high street multiples, and independent retailers, as well as out of centre retail warehousing provision and comparison goods floorspace within the major supermarkets. The LRDS confirmed that Lancaster city centre has by far the highest level of comparison goods floorspace, with Morecambe town centre second highest followed closely by Lancaster City Retail Park (Sunnycliffe) which smaller levels at Bulk Road and Kingsway Retail Parks in Lancaster.

Carnforth has a more limited comparison goods role within the district. 3.47 Our re-analysis of the market share of facilities in the district indicates that the level of trade passing through comparison goods facilities which originate from inside the Study Area is £323.8m at 2013. This represents a market share 29.6% of the total comparison goods expenditure generated from within the defined Study Area. We estimate that an extra £51.9m is drawn to the city as ‘inflow’ from outside the Study Area (in accordance with STEAM estimates). This represents an inflow of around 16%. Table 3.12 below provides a breakdown of the comparison goods market share by different shopping destinations across the district.

28 WYG Planning creative minds safe hands Table 3.12: Comparison Goods Market Share and Turnover within the Study Area (2013) Destination Market Share (%) Survey Estimate Turnover (£m) Lancaster City Centre 15.4 164.7 Edge of Centre/Out of Centre Supermarkets 0.6 6.5 Bulk Road and Kingsway Retail Park 3.0 33.0 Other Out of Centre (undefined) 1.3 17.2 Sub-Total 20.3 221.4 Morecambe Town Centre 4.0 44.2 Sub-Total 4.0 44.2 Retail Parks Lancaster City Retail Park 3.0 33.1 Central Drive 0.4 4.8 Other Out of Centre 1.2 12.3 Sub-Total 4.6 50.2 Carnforth Town Centre 0.3 3.1 Sub Total 0.3 3.1 Local Centres Heysham 0.0 0.3 Torrisholme 0.0 0.1 Caton 0.0 0.0 Bolton Le Sands 0.2 2.3 Sub-Total 0.3 2.5 Other (undefined) 0.2 2.1 Sub-Total 0.2 2.1 Total 29.6 323.8 Notes: Based on findings of the Lancaster Household Survey (2013), taken from Table 26 of Appendix 2 Based on market share of expenditure (comparison goods) after allowance made for inflow (£51.9m) At 2013 prices 3.48 With total combined level of comparison goods floorspace within the three main retail parks (Bulk Road, Kingsway and Lancaster City Retail Park (Sunnycliffe)) and other out-of-centre stores comparable to that in Lancaster city centre, the city centre remains the single most popular destination for comparison goods shopping, retaining 15.4% of available expenditure within the wider Study Area.

The three retail parks together with other out-of-centre destinations collectively retain just under a tenth (9.5%) of all available expenditure, this represents 32% of the spend retained in the wider district demonstrating the popularity of such destinations. Morecambe town centre is the

29 WYG Planning creative minds safe hands second most popular destination, retaining 4.0% of local generated expenditure. Lancaster City Retail Park (Sunnycliffe) is the most popular of the three parks, retaining 3.0% of locally generated expenditure. Bulk Road and Kingsway together attract a further 3.0% of locally generated expenditure. Carnforth and the other local centres have a limited comparison goods retail role in the wider district with a combined market share of just 0.6%. This compares to the 31.4% identified in Table 6.10 of the LRDS. The principal reason for the reduction in the market share is due to the attribution of comparison goods expenditure that is related to the revised population levels, the change to SFT allowances, also the number of trips for the different non-food goods sectors remains constant when the trips are attributed to the latest non-food sector expenditure and accumulated together to represent the total comparison goods spend, the comparison goods market share represents the percentage of expenditure rather than trips and can be different.

3.49 On this basis, WYG has ‘rolled forward’ Lancaster’s current 29.6% market share to examine the likely level of comparison goods floorspace required to maintain its current role and function and position within the hierarchy.

Comparison Goods Quantitative Need in Lancaster (District Wide) – Baseline 3.50 Accordingly, given the re-forecast increases in comparison goods expenditure, special forms of trading, increased floorspace efficiencies and projected increases in the Study Area population, WYG estimates that at 2018 there will be an expenditure deficit of £1.8m showing there is no requirement for new floorspace in the first five years. This compares to an expenditure surplus of £4.1m identified at 2018 in the LRDS. With no capacity identified in the short term, Table 4.13 identifies that an expenditure surplus is then forecast at £17.3m at 2023, increasing to £54.5m at 2028 and to £79.7m at 2031.

This compares to a £82.8m in the LRDS at 2031, demonstrating that the capacity has reduced by £3.1m which is a 4% reduction on previous estimates in the LRDS. Table 3.13: Baseline – Quantitative Need for Comparison Goods Floorspace in Lancaster (District) Year Benchmark Turnover (£m) Derived Available Expenditure (£m) Surplus Expenditure (£m) 2013 375.7 375.7 0.0 2018 448.5 446.7 -1.8 2023 495.2 512.5 17.3 2028 546.7 601.3 54.5 2031 580.2 660.0 79.7 Source: Table 27 (Table 1a) of Appendix 2 In 2013 prices

30 WYG Planning creative minds safe hands Table 3.14: Baseline – Quantitative Need for Additional Comparison Goods Floorspace in Lancaster (District) – After Post Implementation of Commitments Year Comparison Goods £m Floorspace Requirement (sq.m net) Surplus Implemented Residual Min Max 2013 0.0 2018 -1.8 4.5 -6.4 -1,100 -1,800 2023 17.3 5.0 12.3 1,900 3,100 2028 54.5 5.5 49.0 6,700 11,200 2031 79.7 5.9 73.9 9,600 15,900 Source: Table 27 (Table 1c) of Appendix 2 In 2013 prices 3.51 Since the LRDS (2014) was undertaken, Lancaster district has been the subject to a number of small implemented comparison goods retail developments, which together have a combined floorspace of 1,100 sq.m net.

The implemented developments which contribute the largest proportion of comparison goods floorspace include a new mezzanine at the Dunelm store at Sunnycliffe Retail Park (circa 600 sq.m net), the comparison goods floorspace at the new Aldi store at Carnforth and that at the extension of the Morecambe Road store, and the new retail unit at the Squires Snooker club at Penny Street in Lancaster city centre. The results show that based on the existing market share remaining constant at 29.6% and after the implemented schemes have been accounted for then the expenditure deficit will increase to -6.4m at 2018 and there is no capacity for new retail floorspace; however, at 2023 the capacity will return to a expenditure surplus of £12.3m which could accommodate between 1,900 sq.m (net) and 3,100 sq.m (net).

Over the wider plan period up to 2031 a expenditure surplus of £73.9m will be available for new provision, this compares to £73.2m that was identified in the LRDS (Table 6.12) at 2031.

3.52 Drawing on information from Lancaster District Council, there is circa 14,200 sq.m (net) of comparison good floorspace is currently proposed across the district (in the form of extant planning permissions). The majority of this is proposed within the Frontierland scheme (LPA Ref: 14/00388/FUL) at Marine Road in Morecambe which comprises over 9,400 sq.m (net) of comparison goods floorspace WYG estimates that if this committed comparison goods floorspace is implemented it would have a benchmark turnover of £33.0m if these were trading at 2018, this is consistent with the assumptions provided within the ‘Planning and Retail Statement’, provided by Peacock and Smith in March 2014.

Of this, we estimate that £26.4m would be derived from the Study Area, with the rest coming from beyond the Study Area due to tourism spend. In addition, there is nearly 3,200 sq.m of floorspace coming forward through the reconfiguration of the Market Hall in Lancaster city centre which will be occupied by Primark, we estimate that this will have a benchmark turnover of £18.8m at 2018. These two planning permissions represents 89% of the total proposed floorspace in the district and once

31 WYG Planning creative minds safe hands implemented and therefore estimated benchmark turnover would represent about 87% of the total estimated turnover from all planning permissions (£59.7m). As with the LRDS we have assumed by 90% of planning commitments will come forward over the plan period. As shown in Table 3.14, these commitments absorb all of the identified capacity for major new comparison goods development in the short term up to 2018 based on the existing market share being retained (and based on current economic forecasts) all the way through to 2031. The reduction in capacity from that identified in the LRDS is a significant change, whereby in the LRDS a capacity of between 10,200 sq.m (net) and 17,000 sq.m (net) was identified over the plan period, now with over 14,000 sq.m (net) proposed in addition to an extra 1,100 sq.m (net) of new floorspace that has been delivered shows that these proposals would have absorbed the previously identified capacity in the LRDS.

As in the LRDS we recommend that any capacity identified in the period beyond 2018 should be considered with a degree of caution as a number of assumptions may change in the future which could ultimately change this capacity.

Table 3.14: Net Quantitative Need for Comparison Goods Floorspace in Lancaster (District) – Extant Planning Consents Year Comparison Goods £m Floorspace Requirement (sq. m net) Residual (Taken from 3.13) Extant Residual Min Max 2013 2018 -6.4 55.5 -61.9 -10,400 -17,300 2023 12.3 61.3 -49.0 -7,400 -12,400 2028 49.0 67.7 -18.7 -2,600 -4,300 2031 73.9 71.8 2.1 300 400 Source: Table 27 (Table 1c) of Appendix 2 In 2013 prices 3.53 To be consistent with the LRDS below we set out the revised capacity for comparison goods retailing in Lancaster and Morecambe as the key principal locations for such development.

Comparison Goods Quantitative Need in Lancaster Urban Area (Zone 1) 3.54 We have sought to re-appraise the need for additional comparison goods retail floorspace in the main urban area around Lancaster, we have considered the trading performance of existing facilities in Zone 1 which form the main urban area of Lancaster. Existing facilities in Zone 1 retain 70.0% of the available comparison goods expenditure generated within Zone 1 and 20.3% of all available spend within the Study Area. When the retention of comparison goods spend in Zones 2, 3, 5 and 6 is considered strong (between 34% and 60%), it is evident that existing facilities in Zone 1 have a wider

32 WYG Planning creative minds safe hands draw, demonstrating that facilities in Zone 1 attract over a fifth of all the spend within the wider Study Area demonstrating it has the highest trade retention of all the survey zones. 3.55 The results show that Lancaster city centre retains £168.7m of comparison goods expenditure with a further £29.5m attracted to the city centre through inflow, so a derived turnover or nearly £200m. 3.56 Our analysis, set out at Table 3.15, indicates that the comparison goods facilities in and around the Lancaster urban area, retain £221.4m of comparison goods expenditure (excluding inflow).

WYG estimates drawing on STEAM estimate that there is inflow of 16% from outside the Study Area, which represents £35.2m, increasing the derived turnover to £256.6m. 3.57 Assuming this market share (20.3%) is maintained and ‘rolled forward’; we estimate that by 2018 a comparison goods expenditure deficit of £1.3m originating from within the Study Area to facilities. After allowing for increases in the turnover efficiencies of existing floorspace, a surplus of £11.8m is available at 2023 to support additional comparison goods floorspace. This identified surplus is forecast to increase to £37.3m at 2028 (previously £42.6m in the LRDS) and to £54.5m at 2031 (previously £55.5m in the LRDS).

Table 3.15: Quantitative Need for Comparison Goods Floorspace in the Lancaster Urban Area baseline Year Benchmark Turnover (£m) Available Derived Expenditure (£m) Surplus Expenditure (£m) 2013 256.6 256.6 0.0 2018 306.4 305.1 -1.3 2023 338.3 350.1 11.8 2028 373.5 410.7 37.3 2031 396.3 450.8 54.5 Source: Table 27 (Table 2a) Appendix 2 In 2013 prices 3.58 As identified earlier, WYG are aware that circa 900 sq.m of new comparison goods sales area has been implemented across the Lancaster Urban Area since completion of the LRDS. Table 3.16 sets out our estimate that implemented floorspace in the Lancaster Urban Area will have a total estimated turnover of £2.8m once trading at 2018, given the scale and nature of the floorspace secured we expect that this will all be drawn from the Zone 1.

We also note that given the scale of such floorspace it is unlikely to result in any significant uplift in market share across the Study Area. This would leave a residual surplus of -£4.1m at 2018 based on the existing market share remaining constant at 20.3%. In the medium to long term residual capacity is expected to increase to £8.8m at 2023, £33.9m at 2028 and to £50.9m at 2031. At 2031, between 6,600 sq.m and 11,000 sq.m of net

33 WYG Planning creative minds safe hands floorspace could be supported based on the existing market share being retained, the latest figures are consistent with those identified in the LRDS (Table 6.14). Table 3.16: Quantitative Need for Additional Comparison Goods Floorspace in Lancaster Urban Area – Baseline Post Implementation of Commitments Year Comparison Goods £m Floorspace Requirement (sq.m net) Surplus Implemented Residual Min Max 2013 0.0 2018 -1.3 2.8 -4.1 -700 -1,100 2023 11.8 3.1 8.8 1,300 2,200 2028 37.3 3.4 33.9 4,700 7,800 2031 54.5 3.6 50.9 6,600 11,000 Source: Table 27 (Table 2c) of Appendix 2 In 2013 prices 3.59 In addition to implemented planning permissions, there are a number of extant planning permissions for additional comparison goods floorspace in the district.

From information provided by the Council, we can confirm that in Zone 1 there is over 4,700 sq.m (net) of comparison goods floorspace, this comprises a mixture of schemes including mezzanine floorspace in existing retail parks, to new comparison goods floorspace in proposed foodstores to the reconfiguration of the Market Hall for the Primark store, which represents two thirds of the proposed floorspace in Zone 1. In addition given the cross settlement shopping patterns that occur between Lancaster and Morecambe, we expect that 60% of the turnover of extant planning permissions will be drawn from any expenditure surplus for Lancaster with the rest from Morecambe.

This is important given the approval for the Frontierland scheme in Morecambe (Zone 2), and we expect that a significant amount of this scheme’s turnover will be drawn from residents in Zone 1 (as well as Zone 2). Indeed, Peacock and Smith (P&S) in their retail evidence (2014) confirmed that 30% of the Frontierland scheme trade draw would be from Zone 1 with 15% from Zone 2. Indeed, P&S estimate that circa £13.0m (30%) of the turnover of Frontierland would be diverted from Lancaster city centre, WYG can confirm that the city centre has a derived turnover of £198.1m (including inflow) at 2013 estimated (assuming same market share) to increase to £236.5m by 2018, then the impact would be circa 5% on Lancaster city centre at 2018.

After allowing for inflow, this would leave a residual turnover of £223.5m at 2018, this would still allow facilities in and around Lancaster (Zone 1) to retain a market share of circa 20.0% at 2018. Deducting allowances for inflow, Lancaster city centre’s derived turnover is estimated to be circa £201.4m at 2018 (currently £168.7m), representing a market share of 15.4% within the Study Area, with £13.0m diverted from the Lancaster city centre at 2018 the residual turnover will be £188.4m which would represent a market share of 14.5% which represents an impact of 6% on the current market share.

This revised figure needs to be considered in the context that Lancaster’s market share

34 WYG Planning creative minds safe hands was previously identified in the Lancaster Retail Study (2006) at circa 19% in 2006 demonstrating a significant decline in its market share over the last ten years. Table 3.17: Quantitative Need for Additional Comparison Goods Floorspace in Lancaster Urban Area – Baseline after Commitments Year Comparison Goods £m Floorspace Requirement (sq.m net) Residual (Taken from 3.16) Extant Residual Min Max 2013 2018 -4.1 33.3 -37.4 -6,300 -10,400 2023 8.8 36.8 -28.0 -4,300 -7,100 2028 33.9 40.6 -6.7 -900 -1,500 2031 50.9 43.1 7.8 1,000 1,700 Source: Table 27 (Table 2c) of Appendix 2 In 2013 prices 3.60 Table 3.17 shows that once implemented comparison goods retail developments and extant planning consents are taken into account, there would be a deficit in comparison goods expenditure up to 2028.

At 2031, there would be £7.8m residual comparison goods expenditure, which could support between 1,000 and 1,700 sq.m net comparison goods floorspace only.

3.61 As with the LRDS, it should be noted that long term estimates should be viewed with a degree of caution as even moderate changes to population levels and expenditure growth forecasts as shown in this update can have a significant bearing on estimates of available expenditure over time (as will any failure to implement existing planning commitments). These estimates are based on up-to-date information available at the time of reporting, and we would therefore recommend that these are regularly monitored to ensure the Council’s preferred strategy is realised. Comparison Goods Quantitative Need in Morecambe (Zone 2) 3.62 Our re-analysis indicates that comparison goods facilities in Morecambe (Zone 2) retain £94.7m (previously £97.2m) of comparison goods expenditure (excluding inflow), equating to 8.7% (previously 9.5%) of all available expenditure generated within the Study Area.

WYG re-estimates using STEAM data, that there is inflow of 17.5% from outside the Study Area, which represents £16.6m of expenditure. This increases the derived turnover to £111.4m (previously £114.4m).

35 WYG Planning creative minds safe hands Table 3.18: Quantitative Need for Comparison Goods Floorspace in Morecambe Year Benchmark Turnover - £m1 Derived Available Expenditure - £m2 Surplus Expenditure 2013 111.4 111.4 0.0 2018 133.0 132.4 -0.5 2023 146.8 151.9 5.1 2028 162.1 178.1 16.0 2031 172.0 195.4 23.3 Source: Table 27 (Table 3a) of Appendix 2 In 2013 prices 3.63 We assume that the identified market share is maintained and ‘rolled forward’ in the future and, on this basis, changes in forecast comparison goods expenditure and projected increases in population will actually result in an expenditure deficit of just -£0.5m (previously a expenditure surplus of £1.3m) in Morecambe by 2018.

Subsequent to this, a surplus of £5.1m (previously £8.1m) is available at 2023 to support additional floorspace, increasing to £16.0m (previously £19.6m) at 2028 and to £23.3m (previously £25.5m) at 2031.

3.64 There have been no major comparison goods floorspace implemented in Zone 2 since completion of the LRDS. However, given the synergy with Zone 1 and Lancaster and Carnforth in Zone 6 it is expected that some of the identified capacity will be drawn from proposed new floorspace in Zones 1 and 6. We have therefore estimated that 40% of the implemented floorspace will absorb some of the capacity in Zone 2. As shown in Table 3.19 below, the implemented floorspace will compound the expenditure deficit further by 2018, based on the existing market share being retained. In the medium term (2023), we estimate that between 500 sq.m (net) and 800 sq.m (net) can be accommodated and this would increase to between 2,700 sq.m (net) and 4,600 sq.m (net) by 2031.

However, WYG would recommend that any capacity beyond 2018 is monitored regularly and once more up to date information is available as new development could impact on the market share of different retail destinations both inside and outside the Study Area and this may affect future capacity estimates. Table 3.19: Quantitative Need for Additional Comparison Goods Floorspace in Morecambe – Baseline Post Implementation of Commitments Year Comparison Goods £m Floorspace Requirement (sq.m net) Surplus Implemented Residual Min1* Max2* 2013 0.0 2018 -0.5 1.7 -2.3 -400 -600 2023 5.1 1.9 3.2 500 800 2028 16.0 2.1 13.8 1,900 3,200 2031 23.3 2.3 21.1 2,700 4,600 Source: Table 27 (Table 3c) of Appendix 2

36 WYG Planning creative minds safe hands In 2013 prices 3.65 Since the LRDS (2014) was undertaken, Morecambe has been the subject the planning permission for new comparison goods retail development at Frontierland, which would have a combined floorspace of over 9,400 sq.m net and will have an estimated turnover of £33.0m. Table 3.20 below show the need for further comparison goods development in the district taking into account the implemented and extant comparison goods floorspace across the plan period.

Table 3.20: Quantitative Need for Additional Comparison Goods Floorspace in Morecambe – Baseline after Commitments Year Comparison Goods £m Floorspace Requirement (sq.m net) Residual (Taken from 3.19) Extant Residual Min1* Max2* 2013 2018 -2.3 22.2 -24.5 -4,100 -6,800 2023 3.2 24.5 -21.4 -3,200 -5,400 2028 13.8 27.1 -13.2 -1,800 -3,000 2031 21.1 28.7 -7.6 -1,000 -1,600 Source: Table 27 (Table 3c) of Appendix 2 In 2013 prices Qualitative Need 3.66 The above re-analysis provides an assessment of quantitative capacity based, for the most part, on the current market share achieved by existing facilities in a particular centre being maintained, despite new development’s taking place in the last 18 months.

As explored in detail in Sections 4 and 5 of the LRDS, the results show that Lancaster has a high retention of both convenience goods and comparison goods shopping patterns in the immediate zone covering the district (Zone 1), with limited outflow of trade to other competing centres, however, more significant expenditure lose is seen in Zone 2, 3 and 6 but, and section 6 of the LRDS confirmed that there is likely to be scope for claw back of expenditure if new managed retail floorspace is secured in Lancaster. The results in the LRDS showed that the Lancaster city centre comparison goods market share has declined between 2006 and 2013 across all zones in the Study Area, but improvements had been experienced at the existing retail parks (and standalone stores).

In this context, the previous LRDS explored the scenario of increasing the overall retention level across the district in response to the decline in market share since 2006 with the intention that this would be focused on improvements to the retail offer centred on enhancing the clothing and footwear (of fashion) sector in a central location at Canal Corridor in the city centre. 3.67 Since the preparation of the LRDS a number of considerations have changed, most notably is the planning permissions for the Frontierland scheme in Morecambe as well as Primark taking the Market

37 WYG Planning creative minds safe hands Hall in Lancaster city centre, which once implemented are likely to improve the retail offer of both settlements and help address the deficiency in the fashion sectors. This is unlikely to be to the degree expected from the comprehensive Canal Corridor opportunity adjacent Lancaster city centre but will certainly be positive and help attract more people to Lancaster city centre in the future. We estimate that these two schemes alone with have an estimated benchmark turnover of £51.8m and if trading at these levels could help to enhance the market share, and we would expect that once both trading they would allow the existing facilities to trade at circa £436.6m at 2018, which would represent a district market share 33.6% (currently 29.6%).

This is below the enhanced market share scenario that WYG set out in the LRDS which considered a future district market share of 35%, for the purposes of this update to the LRDS, we believe that with the improvements in comparison goods sector then such a benchmark market share threshold is achievable. For the purposes of this update we have again modelled the scenario that the district seeks to achieve a market share of 35% based on the claw back of clothing and footwear expenditure and to rebalance this sector to ensure it comparable with other non-food goods that achieve higher market shares already.

3.68 Table 3.21 updates Table 6.16 from the LRDS and shows the potential comparison good expenditure capacity that could be realised through achieving enhanced market share of 35% through qualitative improvement to the retail offer. This enhanced position shows that the expenditure would increase to £67.9m at 2018 (previously -£1.8m in baseline) to £97.8m at 2023 (previously £17.3m in baseline), to £149.8m at 2028 (previously £54.5m in baseline) and to £184.8m at 2031 (previously £79.7m in baseline). We note that the latest enhanced figures are comparable to than those estimated in the LRDS in 2018 and 2023, for example the surplus expenditure in 2018 was £68.0m, £100.5m in 2023, £150.6m in 2028.

However, thereafter, at 2031 the capacity is moderately higher at £184.8m compared to £177.5m identified in the LRDS. As set out in Section 2 SFT allowances have been readjusted in the last 2 years as previous forecasts may have been over estimated and therefore as advised previously we would recommend that SFT gains are regularly reviewed (yearly) as more up to date information is sourced. Similarly given the fluidity of retail sales over the last two years there may be merit in regularly monitoring (yearly rather than every 5 years) expenditure growth rates to ensure that a more reliable and sound position is provided which better reflects market conditions.

Table 3.21 Enhanced Market Share Analysis Year Benchmark Turnover (£m) Derived Available Expenditure (£m) Surplus Expenditure (£m) 2013 375.7 375.7 0.0 2018 448.5 516.4 67.9 2023 495.2 593.0 97.8 2028 546.7 696.5 149.8 2031 580.2 765.0 184.8

38 WYG Planning creative minds safe hands 3.69 As with the LRDS and drawing on the enhanced expenditure capacity in Table 3.21 we have adjusted this to remove the implemented planning permissions currently in Lancaster. Table 3.22, shows that after these developments are accounted for there is identified capacity for major new comparison goods development in the short term up to 2018 based on a market share of 35%, whereby a capacity of between 10,600 sq.m (net) and 17,700 sq.m (net) (previously between 10,900 and 18,200 sq.m (net)) can be realised based on a residual capacity of £63.3m. At 2023, WYG estimates that a residual capacity of £92.8m will be available to support new development of between 14,100 sq.m (net) and 23,500 sq.m (net) (previously 15,100 sq.m (net) and 25,100 sq.m (net)), with the residual capacity set to increase to £144.2m by 2028 (previously £141.5m), and to £178.9m (previously £167.9m) by 2031.

Dependent on format and operator, we estimate that there will be a need for an additional 23,200 sq.m to 38,600 sq.m of additional comparison goods floorspace up to 2031, this is comparable to that estimated in the LRDS (after allowing for extant planning permissions at that time). The capacity will ultimately depend on the end tenants that can be secured and we would also recommend that any capacity identified in the period beyond 2018 should be considered with a degree of caution as a number of assumptions may change in the future which could ultimately change this capacity.

Table 3.22: Enhanced Market Share– Post Implemented Commitments Year Comparison Goods £m Floorspace Requirement (sq.m net) Surplus (taken from Table 3.21) Implemented Residual Min Max 2013 0.0 2018 67.9 4.5 63.3 10,600 17,700 2023 97.8 5.0 92.8 14,100 23,500 2028 149.8 5.5 144.2 19,800 33,000 2031 184.8 5.9 178.9 23,200 38,600 3.70 As identified earlier and since completion of the LRDS there has been a number of significant planning permissions approved across the district, which together comprise over 14,000 sq.m (net) of comparison goods floorspace and these mainly being the Frontierland and Primark developments in Morecambe and Lancaster respectively.

The results show that even with an enhanced market share at 35% at 2018, then existing extant planning permissions absorb nearly 90% of the enhanced capacity leaving a limited residual capacity of £7.8m at 2018 which would support a very limited level of comparison goods floorspace. Even at 2023 the extant planning permission would represent about

39 WYG Planning creative minds safe hands two thirds of the identified capacity leaving a residual capacity of £31.5m which could support between 4,800 sq.m (net) and 8,000 sq.m (net) of comparison goods floorspace. The results show that the extant planning permissions have absorb a significant level of the previously identified capacity in the LRDS, for example the residual capacity at 2031 is £107.1m this was previously £167.9m in the LRDS, representing a loss of over £60.0m. Table 3.23: Enhanced Market Share– After Extant Commitments Year Comparison Goods £m Floorspace Requirement (sq.m net) Residual (Taken from 3.22) Extant Residual Min Max 2013 0.0 2018 63.3 55.5 7.8 1,300 2,200 2023 92.8 61.3 31.5 4,800 8,000 2028 144.2 67.7 76.6 10,500 17,500 2031 178.9 71.8 107.1 13,900 23,100 3.71 The update to the comparison goods capacity based on both the baseline and enhanced scenarios, clearly show that given the changes to both the economic indicators which influence the overall capacity for estimating future floorspace figures alongside both implemented and extant planning permissions, the results show that there has been a marked decline in the likely level of comparison goods floorspace that could be delivered at the Canal Corridor North site adjacent Lancaster city centre.

Whilst WYG still confirm that a qualitative requirement to improve the retail offer in Lancaster city centre still exists, this will be in part met by the introduction of the Primark at the Market hall, it is unlikely that the level of floorspace previously identified in the LRDS could be supported over the plan period, mainly as a result of the approval for the Frontierland scheme in Morecambe. WYG still recommend that the Council could seek to improve the level of convenience goods provision in the city centre through introduction of foodstore, given the limited capacity that has now been identified in this update to the LRDS then it may be challenging to encourage an operator to want to take space at Canal Corridor North.

WYG are also concerned that the consented scheme at Frontierland has first absorbed a significant level of comparison goods capacity for the district, but also if implemented it may prejudice the ability of Canal Corridor North to secure tenants and dilute the attractiveness of the Canal Corridor scheme to investors due to increased competition from Frontierland which will have implications on the critical mass of any successful scheme at Canal Corridor North.

40 WYG Planning creative minds safe hands 4.0 Retail Capacity (Job Baseline OBR) Employment-Led Growth 4.01 In terms of the emerging evidence to the emerging Local Plan, the Council is reviewing future household projections and housing needs over the future plan period in accordance with paragraph 159 of the NPPF to inform the emerging local plan. Turley Associates (TA) has prepared a detailed ‘Lancaster Independent Housing Requirements Study 2015’ (IHRS) looking at population growth to 2031 this report updates the previous Study published in 2013. As part of this review TA have considered five population projection scenario’s including SNHP 2014 which rebases the ONS 2012 base dataset to ensure consistency with the 2011 Census population estimates; a 10 year past growth scenario; Jobs (baseline); Jobs (baseline OBR) and finally Jobs (Baseline +) scenario.

4.02 For thoroughness, and for our Jobs Baseline OBR population model, we have adopted the Job Baseline OBR scenario set out by TA in the IHRS which identifies a population increase of approximately 19,926 people between 2011 and 2031. For the purposes of this retail scenario, we have simply pro-rotated the population increases across Zones 1, 2, 3 and 6 which cover the district’s administrative area. Unlike the IHRS we have not reviewed the type, tenure and location of new housing but purely considered the increase in population above and beyond the baseline position set out in Section 3.

4.03 As indicated by Table 4.1 (which updates Table 7.1 of the LRDS), under growth ‘Jobs Baseline OBR‘ the identified Study Area is estimated to contain a resident population of circa 392,700 people at 2018 rising to circa 398,350 people at 2023 and to circa 404,900 people at 2028 and 407,670 by 2031. This equates to a greater increase in the Study Area population of circa 10,720 people (a 6.3% increase) when compared to the baseline position set out in Section 4. The revised figures are below that considered in the LRDS in 2014, which estimated a resident population of 412,900 persons at 2031.

Table 4.1: Jobs Baseline OBR Population by Survey Zone (2013 to 2031) Zone 2013 2018 2023 2028 2031 1 55,594 56,859 58,377 60,609 61,841 2 51,481 53,315 55,101 57,372 58,492 3 8,413 11,052 11,330 11,696 11,872 4 30,035 30,775 31,391 31,860 32,033 5 14,429 14,033 14,245 14,472 14,538 6 23,084 24,133 25,004 25,886 26,293 7 11,447 11,931 11,960 11,981 11,950 8 28,324 30,072 30,318 30,503 30,682 9 12,963 12,331 12,369 12,386 12,324 11 86,872 87,581 87,112 86,532 86,191

41 WYG Planning creative minds safe hands 13 18,543 17,567 17,669 17,715 17,698 15 20,061 19,972 20,097 20,213 20,206 16 22,469 23,077 23,381 23,685 23,845 Total (S1) 383,715 392,698 398,354 404,910 407,965 Baseline 383,715 389,720 392,399 395,977 397,246 Difference 0 +2,978 +5,955 +8,933 +10,719 Table 1 (S1) of Appendix 3 Source: 2014 data derived from Experian Micromarketer G3 data and adjusted to reflect IHRS (2015) 4.04 In order to identify the available expenditure under this population scenario, we have again applied the convenience and comparison per capita expenditure data sources from Experian Micromarketer G3 data and applied this to the adjusted population estimates.

4.05 As would be expected greater expenditure growth is forecast under ‘Jobs Baseline OBR’, with the estimated resident population generating £789.1m of convenience goods expenditure at 2018; this is £5.4m more than the baseline position. Convenience goods expenditure is then forecast to increase to £806.8m by 2031 that represents an increase of £19.0m. This compares to the baseline decline of - £5.7m between 2013 and 2031, representing an additional £19.0m of expenditure due to the increased population. The level of convenience goods expenditure is higher than that identified in the LRDS (2013 was £734.8m); however, the level of growth is significant lower than that estimated in the LRDS through to 2031, for example the Jobs Baseline OBR growth was previously identified at £137.0m up to 2031, this compares to £13.3m under the new Jobs Baseline OBR, which reflects the negative annualised growth estimated by Experian.

Table 4.2 ‘Jobs Baseline OBR’ Total Available Expenditure – Convenience (£m) 2013 2018 2023 2028 2031 Growth 2013- 2018 Growth 2013- 2023 Growth 2013- 2028 Growth 2013- 2031 Baseline 793.1 783.8 781.9 786.9 787.3 -9.3 -11.1 -6.2 -5.7 JB OBR 793.1 789.1 792.5 802.8 806.8 -3.9 -0.5 9.7 13.3 Difference 0.0 5.4 10.6 15.9 19.0 5.4 10.6 15.9 19.0 Table 2 (S1) of Appendix 3 4.06 Using population growth ‘Jobs Baseline OBR’, it is estimated that the Study Area population will generate £1,307.2m of comparison goods expenditure at 2018 (again, excluding special forms of trading), which is forecast to increase to £1,995.8m by 2031, representing an increase of £902.6m.

This compares to the baseline growth of £864.1m between 2013 and 2031, representing an additional £38.6m of expenditure. The level of comparison goods expenditure growth is significantly more than that identified in the LRDS which was limited to £681.2m at 2031, at 2031 Jobs Baseline OBR confirms

42 WYG Planning creative minds safe hands that the Study Area will generate £1,995.8m this compares to £1,702.1m identified in the LRDS, which is £293.7m difference. Table 4.3 ‘Jobs Baseline OBR’ Total Available Expenditure – Comparison (£m) 2013 2018 2023 2028 2031 Growth 2013- 2018 Growth 2013- 2023 Growth 2013- 2028 Growth 2013- 2031 Baseline 1,092.8 1,298.4 1,498.9 1,774.4 1,956.8 205.7 406.2 681.6 864.1 JB OBR 1,093.1 1,307.2 1,519.0 1,809.7 1,995.8 214.0 425.9 716.6 902.6 Difference 0.0 8.8 20.1 35.3 38.9 8.4 19.7 34.9 38.6 Table 7 (S1) of Appendix 3 (may not add up due to rounding) Future Quantitative Capacity for Convenience Goods (Job Baseline OBR) 4.07 The quantitative exercise undertaken at Section 3 has been followed again to consider the implications of the population growth set out in Jobs Baseline OBR at the district level only to provide a more broad indication on the relative difference in available expenditure facilitated by the increased population.

Lancaster (District) – ‘Jobs Baseline OBR’ 4.08 Through the application of the higher population growth ‘Jobs Baseline OBR’, like the baseline position Table 4.4 identifies an estimated expenditure surplus for Lancaster (district) of £15.0m at 2013 (beyond the expected benchmark turnover of existing stores), however, given expected population growth levels under Jobs Baseline OBR this is expected to grow to £21.2m at 2018 (£19.4m under baseline), to £22.4m at 2023 (£18.7m under baseline), to £25.8m at 2028 (£20.4m under baseline) and to £27.0m by 2031 (£20.6m under baseline). This represents an increase in the baseline position of £1.8m at 2018, £3.7m at 2023, £5.4m by 2028 and £6.4m at 2031.

Table 4.4: Estimated Capacity for Convenience Goods Facilities in Lancaster under ‘Jobs Baseline OBR’ Year Turnover - £m Available Expenditure - £m Surplus Expenditure - £m 2013 288.9 303.9 15.0 (15.0) 2018 280.3 301.5 21.2 (19.4) 2023 280.3 302.7 22.4 (18.7) 2028 280.3 306.1 25.8 (20.4) 2031 280.3 307.3 27.0 (20.6) Table 30a (S1) (Table 1) of Appendix 3 4.09 With the increase level of population estimated across the Study Area has increased the level of surplus expenditure by £27.0m over the plan period and this will be available above and beyond that

43 WYG Planning creative minds safe hands identified for new facilities in the baseline position. Table 4.5 shows that despite increased population extant planning permissions still absorb most of the identified capacity in the short up to 2018, which still suggests that limited new provision should be actively promoted at this point in time (and above that indicated in the baseline). Table 4.5: Quantitative Need for Additional Convenience Goods Floorspace in Lancaster (District) under ‘Jobs Baseline OBR’ – Post Implementation of Commitments Year Convenience Goods £m Floorspace Requirement (Net) Residual (from Table 4.4) Implemented Residual Expenditure Min Max 2013 15.0 10.6 1.9 145 378 2018 21.2 8.8 12.4 1,000 (800) 2,600 (2,200) 2023 22.4 8.8 13.6 1,100 (800) 2,800 (2,100) 2028 25.8 8.8 17.0 1,300 (900) 3,500 (2,400) 2031 27.0 8.8 18.2 1,400 (900) 3,800 (2,400) Table 32 (S1) (Table 1b) of Appendix 3.

Floorspace figures in brackets are those identified in the baseline position 4.10 As mentioned in Section 4, since completion of the LRDS there have been a number of implemented planning permissions and a number of extant planning permission still exist. Under the ‘Jobs Baseline OBR’ position and like the baseline position, Table 4.6 shows that there would be a residual deficit of - £162m at 2031 this compares to a baseline residual deficit of £11.8m at 2031. The results show that even with increased population growth as a result of the Job Baseline OBR scenario on population growth, there is no additional capacity for convenience floorspace at district level at 2018 and beyond those already committed and based on the current market share being sustained at the baseline position.

Therefore if the Job Baseline OBR scenario strategy is adopted it will not result in any material change to future retail capacity above that identified in the baseline position. Given the relatively difference the population increases derived from the Job Baseline OBR scenario it is not considered necessary to review the capacity for each of the main town centres/Zones again. Table 4.6: Net Quantitative Need for Convenience Goods Floorspace in Lancaster (District) under ‘Jobs Baseline OBR’ – Extant Planning Consents Year Convenience Goods £m Floorspace Requirement (sq. m net) Residual (Taken from 4.5) Extant Residual Min Max 2013 1.9 2018 12.4 19.9 -7.4 -600 (-700) -1,500 (-1,900) 2023 13.6 19.9 -6.3 -500 (-800) -1,300 (-2,000) 2028 17.0 19.9 -2.8 -200 (-700) -600 (-1,700) 2031 18.2 19.9 -1.6 -100 (-600) -300 (-1,700) Source: Appendix 2, Table 6 (Table 2c) Planning commitments within LCC provided by LCC Council.

44 WYG Planning creative minds safe hands 4.11 However, we would recommend that the extant planning permissions are regularly monitored as given the sector is not necessarily delivering existing development commitments then this may free up capacity that could be provided elsewhere in the Future Quantitative Capacity for Comparison Goods (Jobs Baseline OBR) 4.12 The quantitative exercise in Section 4 (Section 7 of the LRDS) has been repeated again to consider the implications of the population growth set out in ‘Jobs Baseline OBR’. Full tabulations are available in Appendix 3.

Lancaster (Global) – ‘Jobs Baseline OBR 4.13 Under growth ‘Jobs Baseline OBR’, Table 4.7 indicates that the comparison goods facilities across the district could claim in the order of £670.7m (compared to £660.0m at baseline) of comparison goods expenditure (both bulky and non-bulky), generated within the Study Area at 2031.

WYG note that this compares to £619.8m up to 2031 in the LRDS, so an additional £50.9m is identified compared to the LRDS. Assuming this market share is maintained and ‘rolled forward’ through future years, given increases in forecast comparison goods expenditure and projected increases in the Study Area population, we estimate that by 2018 an additional £0.6m (compared to -£1.8m at baseline) originating from the Study Area will be spent on comparison goods. After allowing for an adjustment in the turnover efficiency of existing floorspace over the same period, a surplus of £23.1m is available at 2023 (compared to £17.3m at baseline) to support additional floorspace.

This identified surplus is forecast to increase to £91.2m at 2031 (compared to £79.7m at baseline). This shows that Jobs Baseline OBR will increase overall capacity by £11.5m at 2031 when compared to the baseline position. The extra £91.2m at 2031 compares to £85.7m identified up to 2031 in the LRDS, showing that the figure has increased due to improvements to both the expected population levels and the comparison goods expenditure growth rates since completion of the LRDS. Table 4.7: Estimated Capacity for Comparison Goods Facilities in Lancaster (District) under ‘Jobs Baseline OBR’ Year Turnover - £m Available Expenditure - £m Surplus Expenditure - £m 2013 375.3 375.3 0.0 2018 448.0 448.6 (446.7) 0.6 (-1.8) 2023 494.7 517.8 (512.5) 23.1 (17.3) 2028 546.1 611.0 (601.3) 64.9 (54.5) 2031 579.6 670.7 (660.0) 91.2 (79.7) Table 32 (S1) (Table 1) of Appendix 3

45 WYG Planning creative minds safe hands 4.14 Allowance of implemented planning permission to the ‘Jobs Baseline OBR’ position is shown in Table 4.7 below. The results show that, even with increased population growth as part of the Jobs Baseline OBR scenario, as with the baseline position there is capacity for between 11,900 sq.m (net) and 18,400 sq.m (net) for additional comparison floorspace at district level beyond those already committed when current market share is maintained. This is compared to 9,600 sq.m (net) and 15,900 sq.m identified in the baseline position, which is an extra 1,400 sq.m to 2,500 sq.m only.

However, this is more than that identified in the LRDS (2014) which identified between 10,600 sq.m (net) and 17,700 sq.m (net) at 2031.

Table 4.8: ‘Jobs Baseline OBR’ Quantitative Need for Comparison Goods Floorspace in Lancaster (District) – Extant Planning Consents Year Comparison Goods £m Floorspace Requirement (sq. m net) Residual (Taken from 4.7) Implemented Residual Min Max 2013 0.0 2018 0.6 (-1.8) 4.5 -3.9 (-6.4) -700 (-1,100) -1,100 (-1,800) 2023 23.1 (17.3) 5.0 18.1 (12.3) 2,800 (1,900) 4,600 (3,100) 2028 64.9 (54.5) 5.5 59.3 (49.0) 8,200 (6,700) 13,600 (11,200) 2031 91.2 (79.7) 5.9 85.3 (73.9) 11,000 (9,600) 18,400 (15,900) Table 32 (S1) (Table 1b) of Appendix 3 4.15 We have also updated the position to reflect the level of extant planning permissions that exist in the district, and Table 4.9 below demonstrates as with the findings under the baseline, with the Jobs Baseline OBR scenario there is not significant capacity identified for comparison goods retailing above and beyond that identified in the baseline position and therefore depending on whether the Jobs Baseline OBR approach is taken forward within the new development plan, there is still limited requirement to materially change the retail strategy to that set out in the baseline position.

Table 4.9: Net Quantitative Need for Comparison Goods Floorspace in Lancaster (District) – Extant Planning Consents Year Comparison Goods £m Floorspace Requirement (sq. m net) Residual (Taken from 4.8) Extant Residual Min Max 2013 2018 -3.9 (-6.4) 55.5 -59.4 (-61.9) -10,000 (-10,400) -16,600 (-17,300) 2023 18.1 (12.3) 61.3 -43.2 (-49.0) -6,500 (-7,400) -10,900 (-12,400) 2028 59.3 (49.0) 67.7 -8.3 (-18.7) -1,100 (-2,600) -1,900 (-4,300) 2031 85.3 (73.9) 71.8 13.5 (2.1) 1,700 (300) 2,900 (400) Source: Table 27 (Table 1c) of Appendix 2 In 2013 prices

46 WYG Planning creative minds safe hands 4.16 In terms of the enhanced comparison goods market share for Lancaster as set out in section 4, by applying the Jobs Baseline OBR scenario to an increased market share of 35% would lead to a requirement for between 14,200 sq.m (net) and 23,600 sq.m (net) by 2031, which is an increase of between 300 sq.m and 500 sq.m only to that identified in the enhanced baseline position after implemented and extant planning permissions are allow for.

47 WYG Planning creative minds safe hands 5.0 Recommendations and Future Retail Strategy 5.01 The NPPF requires local planning authorities as part of their development plan to set out a strategy for the management and growth of centres over the plan period.

Most particularly, paragraph 23 of the NPPF indicates that, as part of their strategy, authorities should, inter alia:  recognise town centres as the heart of their communities and pursue policies to support their viability and vitality;  define a network and hierarchy of centres that is resilient to anticipated future economic changes;  promote competitive town centres that provide customer choice and a diverse retail offer and which reflect the individuality of town centres;  allocate a range of suitable sites to meet the scale and type of retail, leisure, commercial, office, tourism, cultural, community and residential development needed in town centres;  allocate appropriate edge of centre sites for main town centre uses that are well connected to the town centre where suitable and viable town centre sites are not available.

If sufficient edge of centre sites cannot be identified, set policies for meeting the identified needs in other accessible locations that are well connected to the town centre; and  set policies for the consideration of proposals for main town centre uses which cannot be accommodated in or adjacent to town centres.

5.02 Paragraph 26 of the NPPF also indicates that local planning authorities should set their own appropriate threshold relating to the quantum of floorspace above which an impact test for retail, leisure and office development will be required. Implications of Strategic Approach at CCN 5.03 In consideration of the level of capacity identified in both the baseline and the Jobs Baseline OBR scenario’s need to be considered in relation to the long term objective of the Council’s to regenerate the Canal Corridor North area adjacent the city centre. This has focused on the delivery of a retail led regeneration scheme with the district Council’s development partners which has always sought to reinforce Lancaster city centre’s position in the sub region for both the North Lancashire and South Cumbria.

In 2008, Centros promoted a retail led scheme (LPA Ref: 08/00866/OUT) which was refused planning permission by the Secretary of State principally in relation to principally heritage concerns and not necessarily retail planning policy considerations. Since such time the Council with a new development partner (British Land) have been considering future development options for the CNN site despite a very challenging economic climate that ensued the UK economy between 2008 and

48 WYG Planning creative minds safe hands 2014. It is in the context of the identified capacity that in 2008 Centro were promoting a retail scheme which comprised circa 25,000 sq.m (net) of comparison goods retailing with a 3,115 sq.m (net) convenience floorspace with around 2,500sqm (net) of food and beverage units and associated retail service (525 sq.m net), totalling a gross footprint of over 46,000 sq.m of floorspace. The scheme at the time had between 25 to 37 residential units and included up to 810 car parking spaces. The proposed development at the time was based on 80% of the scheme being comparison goods retailing, clearly demonstrating the dominance of this particular sector on the scheme’s composition.

We note that the scheme made limited allowance for 10% of the floorspace to be allocated towards non retailing uses. This configuration was developed in the context that the Lancaster Retail Study prepared by WYG in 2008 demonstrated that there was a floorspace capacity based on an enhanced market share of 30% for 23,600 sq.m (net) of comparison goods floorspace up to 2016. 5.04 Emerging proposals by British Land for the CCN have floorspace parameters at circa 29,000 sq.m (gross) which is significantly reduced compared to the previously promoted Centros scheme. The emerging scheme is centred on an anchor store but with a mix of large shopping units (MSU) and smaller units (SU) which are more flexible and can be used for retail or leisure uses and a substantial allocation of leisure uses which represent around 15% of the proposed floorspace, the flexible units represent up to 30% of the proposed scheme.

From WYG’s experience elsewhere and given the change dynamics of town centre environments and the ever changing retail and leisure sectors it is highly recommended that developers ensure that future schemes are resilient to both changes to shopping sectors but also new emerging trends and uses that can add to the vibrance of a town centre environment. Town centres had become too reliant on upon retailing and more specifically comparison or non food retailing which due to the structural changes that ensued left an oversupply of retail floorspace that was not necessarily best placed to accommodate demand and changing tenant requirements.

Instead there had been a preference for out-of-centre retail parks which compounded the shift in shopping patterns and has been evidenced in Lancaster between 2006 and 2014 through the gains in market share on the satellite retail parks. WYG’s retail modelling since 2006 has sought to ensure that any identified capacity responds to changing consumer patterns and trends that ensure that the retail strategy is robust and reflective of such changes that influence operator and business requirements.

5.05 The ‘Beyond Retail: redefining the Shape and purpose of Town Centres’, was published by an industry led taskforce in November 2013 to consider the broad range of issues that have impacted on the investment in the UK’s town centres. The report clearly identified that town centres are and should remain the hubs of their local communities and therefore they need to move beyond retail by rebalancing to provide a diverse range of alternative functions including employment, commercial, leisure, community residential, healthcare and education. These will all seek to increase activity (both

49 WYG Planning creative minds safe hands daytime and evening) and footfall that will help to encourage interest and usage which retail can ultimately benefit from in the future.

This diversification will help to reposition and reinvigorate the high street and central town and city areas, to remain economically vibrant and be the pillars of the local and regional economy. 5.06 Since 2013, WYG through other public and private sectors partners have seen a real change in the future dynamics of town centre development proposals which have actively embraced alternative uses and introducing move resilient schemes which embrace the beyond retail mandate, the following schemes for example show how the traditional town centre environment has successfully introduced alternative uses to diversify the activity and uses: Bradford ‘Broadway’ Northwich ‘Baron’s Quay’ Oldham ‘Princes Gate’ Scale: 53,000 sq.m (70 units) Scale: 25,700 sq.

(42 units) Scale: 15,000 sq.m (12 units) 6 screen cinema Additional 1,070 sq.m restaurant space adjacent 1,300 car parking spaces 3,700 sq.m of leisure including Cinema/Hotel 45 residential units Asda Foodstore 1180 car parking spaces (MSCP) 109 residential units Hotel Aldi foodstore 450 car parking spaces 25% of units Food & Beverage 19% of units are leisure related Flexible A1/A2/A3/A4/A5 units (50% of units) Opened November 2015 Development commenced 2015 Planning stages, scheduled to open 2017

50 WYG Planning creative minds safe hands Stafford ‘Riverside’ Lichfield ‘Friarsgate’ Bury ‘The Rock’ Scale: 48,000 sq.m (22 units) Scale: 18,000 sq.m (35 units) Scale: 57,000 sq.m (60 units) Anchors M&S and Primark 1,600 sq.m Cinema (6 screen) 1,000 MSCP Potential for Small foodstore Up to 6 screen cinema 95 residential properties 500 MSCP Anchors Debenhams and Marks & Spencer 10 screen cinema and bowling alley 1,250 car parking spaces, 397 residential units 45% of units Food & Beverage 30% of units food and Beverage, gymnasium, but flexible space 25% of units food and beverage or leisure uses Development commenced 2014, trading scheduled Summer 2016 Planning Stages, scheduled to open in 2018 Opened July 2010 5.07 The emerging proposal from British Land are encouraging in the sense that they recognise that the market has changed and will continue to change in the future and therefore seek to provide more flexibility into the future proposals.

The proposed level of floorspace at circa 29,000 sq.m (gross) would sustain a net sales area of circa 20,000 to 23,000 sq.m9 . The higher figure is at the higher threshold identified through the enhanced market share scenario adopting the Jobs Baseline OBR scenario adopted in Section 4, and covers the capacity identified across the district as a whole up to 2031. Therefore the current proposals may still be ambitious in light of the current level of population and expenditure levels under the Jobs Baseline OBR position, however, as previously identified in the 9 Assumes a gross to net of range of between 70:30 to 80:20.

51 WYG Planning creative minds safe hands LRDS, the city centre’s market share has consistently declined since 2006 and therefore there remains a quantitative and qualitative need that can seek to arrest this decline and reduce the increased dominance of the retail parks. 5.08 Any proposal at CCN will require strong leadership from both the district Council and the British Land to engage with the existing business and residential community and deliver long term change in the city centre function. This will ensure an economic investment masterplan for the CCN area to meet both today’s and future generations needs for retailing, leisure and community uses.

A clear vision that helps strengthen certainty and encourages private sector investment will be paramount to the delivery of the CCN site. Such an approach will ensure a strong and dominant Lancaster city centre in the sub region that offers the widest range of retail, leisure, food and beverage uses in a highly accessible location and will provide consumers with a diverse experience that may reduce the frequency of visits but spend and dwell periods will increase as a result. Whilst WYG identify that there is a qualitative need to improve the convenience goods offer in Lancaster city centre, the changing market with increased preference for discount retailers, and more localised convenience is leading to the trend for the larger basket weekly shop being undertaken more regularly than a typical large weekly trolley.

More regular local basket top up trips is leading to demand for more convenience stores on our high streets. This is principally being driven by the time poor consumers, more single occupancy living, with both elderly and young groups increasing and more urban households. Together therefore changing the patterns of how we shop for convenience goods, and is coupled with the strong student population in Lancaster that requires a more basket and time limited orientated experience, the city centre should seek to capitalise on such changing consumer demand. 5.09 Successful town centres are also reliant on their accessibility, and their ability to ensure that consumers can easily access them via either public transport or through private motor vehicle, walking and cycling.

It is critically important to ensure that the amount, location, quality and the pricing of parking is a key consideration at CCN to ensure that it encourages visitors to the city centre. This is especially important given the local competition at retail parks which often provide free surface level car parking which often a cheaper alternative to town centre facilities. The a correlation between location, cost, specification and age of multi storey car parking and their usage and the revenues that they create for local authorities needs to be balanced against potential increases in trade as a result of affordable car parking pricing strategy.

The Council should seek to review a number of different car parking schemes that have been adopted in different town centres across the UK, which have delivered real increases in trade uplift but whilst at the same time having sufficient controls in place to ensure parking provision is not abused and there is a healthy turnover of spaces, ensuring capacity is maintained throughout the trading and evening periods.

52 WYG Planning creative minds safe hands 5.10 In addition, with the advent of electronic shopping, that being through traditional websites and now through other platforms such as mobiles and tablets, the growth of multi-channel shopping (OMNI) has had a transformational change on shopping patterns. This has created a number of challenges to property requirements, which has meant that town centres must engage and embrace not only the changing physical requirements but also the technological demands of modern multi-channel consumers to maximise the choice of when, how and where they can shop.

This process allows consumers to engage with a retailer on a multi-faceted approach that can provide a seamless experience. It is therefore critically important that any proposals at CCN seek to maximise the digitising of the high street10 to provide consumers with all of the choices required to meet their future demands. With estimated market share for non-stores sales recorded at 12.5% in 2014 and estimated to increase to 19.6%11 by 2035, then it is imperative that such technologies are designed in to the town centre environment to ensure that such a transaction can still be captured by local businesses.

5.11 Moving forward with the CCN site, WYG would recommend that the Council seek to allocate the site for a mixed use development that seeks to introduce both commercial retail and leisure, community, car parking and residential uses that all seeks to create activity but also seek to embrace the digital revolution which has shifted consumer shopping patterns in recent years. This flexible approach will ensure that paragraph 23 of the NPPF is satisfied in that the retail and leisure uses are met in full and seek to address the city centre’s decline through positively encouraging economic activity and residential development which together will ensure the vitality and viability of the centre is secured in the long term.

10 Digital High Street 2020 Report – March 2013. 11 Experian Retail Planner Briefing Note 13 (October 2015)

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