Powerscourt Townhouse Centre, the shopping centre off South William Street, a short walk from Grafton Street, has started to win back business since it was re-launched last May.

Smart new shops such as French Connection UK - with its eyebrow-raising FCUK logo at its front door - and Karen Millen are drawing in customers lost when the centre went into "retail limbo" a few years ago, after previous owners, Power Corporation, went out of business.

Regular customers visiting Powerscourt Townhouse will be surprised at the space and light created by alterations to the somewhat dated shopping centre.

French Connection and other new traders on the block, such as the smart Mimo restaurant on the ground floor, are exponents of the uncluttered look, which cost the new owners, Clarendon Group, around £2 million to create.

Spokesman Paul McElearney says business is "doing well" and Clarendon is pleased with the work.

Agents for the centre, Hamilton Osborne King, say there is a new market for leases in the centre since the introduction of the new fashion outlets.

"A number of interesting international fashion names have made unsolicited approaches to us since the recent repositioning of the centre," says Larry Brennan of HOK. Dissatisfaction among some tenants with the redesign of the centre may abate if trade continues its upward trend. Some of the longer-established leaseholders preferred the traditional Georgian ambience and are unhappy about the loss of some of the period features. They say the building is "stark and lacking in character". That said, the management company's aim to attract upmarket niche retailers to the centre should create a strong identity for Powerscourt Townhouse in the longer term. Between them, French Connection and Karen Millen invested almost £1 million in their new shops. French clothing company Eden Park is opening soon on the ground floor. A well-known specialist Irish retailer is currently negotiating for 2,000 sq ft of space, according to Paul McElearney. At lunchtime last week, the centre was fairly busy, with a more relaxed atmosphere than crowded Wicklow and Grafton Streets nearby. Rents work out at £60 to £65 per sq ft for the ground floor, £30 to £35 for the first floor and £20 to £25 for tenants on the top floor. These are still considerably less than rents on Grafton Street.

The Clarendon Group says rents will only go up "as a normal course of events". Nevertheless, the coming of major international retailers to the centre will inevitably bring increases when leases come up for review. The Design Centre, a showcase for Irish fashion designers, has been moved to the second floor to make room for the two-storey French Connection store. While the Design Centre says business is good and undoubtedly the layout is better, grumblings among individual designers would indicate that all is not roses here.

The FCUK logo of the new fashion shop which dominates the centre's William Street entrance is a bone of contention with some tenants, who say that the sign is "putting off" regular customers. "The sign did raise some eyebrows, but it is part of their 6,500 sq ft area," says Paul McElearney.

French Connection is a smart, all-steel-and-glass store, and its unfussy "directional" clothes are aimed at "the independent woman and man". A separate street entrance means customers do not have to walk through the centre to get into the store - a disappointing decision for many of the tenants. Inside, the courtyard has been opened out by the removal of several smaller outlets and the smart walnut wood and glass Mimo restaurant creates a central meeting point.

Chompys restaurant on the first floor balcony is still doing a good trade. The raised central stage where a pianist used to play has gone and the Georgian window sills, denuded of flower boxes, are more obvious to the eye. A small stage area has been created on the first floor balcony and there will be a pianist here at weekends, says Paul McInerney.

Old-fashioned lamps have been replaced with modern lighting and some Georgian window "aprons" were removed to make way for new doors and a timber lift shaft. The company has applied to Dublin Corporation for retention of the changes to the windows.

The antique gallery has been restyled and space here is more accessible. A licensed restaurant similar to Bluebirds in Chelsea is planned for the top floor.

Sunday opening is a new departure, but some of the established tenants are reluctant, arguing that trading won't cover the extra management costs.

These management charges are based on individual rates and shop owners say it works out at approximately 35 per cent to 40 per cent of the rents.