A distinct lack of footfall caused by lockdown restrictions negatively affected city high streets globally during the Covid-19 pandemic, creating an unprecedented challenge for the world of bricks-and-mortar retail. Here at home, the impact was arguably most pronounced on Grafton Street, with numerous of the celebrated stretch’s units either shuttered permanently or engaged in a stop-start struggle to attract the dwindling number of visitors to Dublin city centre with heavily discounted sales.
Having established itself over the course of nearly 200 years as the capital’s foremost shopping district, by August 2020 and just six months on from Covid-19′s unwelcome arrival, the street’s very survival appeared to be in question. One report on the street at the time was headlined “It’s like a ghost town”.
Although it’s easy, with the benefit of hindsight – and vaccines – to dismiss the pandemic-era reports of Grafton Street’s looming demise, it remains to be seen if the street can return to the improbable heights of the Celtic Tiger years, when its status as the destination of choice for deeper-pocketed shoppers was yet to be rivalled by online retail or the arrival of Dundrum Town Centre, in south Dublin. For while the threat posed by Covid-19 has receded, the threat posed by the growth of online retail has been compounded by the cost-of-living crisis and levels of inflation not seen since the 1980s.
Despite these and other challenges, the recovery in Grafton Street’s fortunes has reached the point where Eoin Feeney, head of retail at commercial real estate adviser Colliers, believes it could reach an occupancy level of 100 per cent this year. While this resurgence is largely being driven by the return to more normal footfall levels in the city centre, a much-needed reset in the relationship between landlords and their tenants is also under way.
In January 2021, for example, premium German fashion retailer Hugo Boss signed a new 10-year lease on its flagship store at number 67-68, committing to an annual rent of €630,000. The figure represented a 24 per cent reduction on its previous rate. Following the phased reopening of non-essential retail in May of last year, the leading athleisure brand Lululemon became the first new retailer to announce an opening on Grafton Street since before 2020, committing to a 10-year lease at number 84 for a sum understood to be in the region of €400,000 per year.
In a further sign of confidence in the street’s future prospects, The Irish Times reported in June 2021 that German investor Deka Immobilien had purchased 26-27 Grafton Street, the premises of fashion retailer & Other Stories, from Aviva Investors for a sum understood to be in the region of €22 million. The deal’s completion provided a timely boost, coming as it did just four weeks after Tommy Hilfiger signalled its intention to close its flagship Grafton Street store permanently.
Although the impact of the pandemic is believed to have influenced the US fashion retailer’s move to a certain degree, it is understood that the company decided to exercise the 15-year break option on its 25-year lease 12 months early. In handing back the keys to its landlord ahead of time, Tommy Hilfiger is believed to have paid the near €1.7 million boom-era rent due for that period. The retailer had occupied the premises at 13-14 Grafton Street since 2007.
We’re down to not a huge amount of vacancy and we have had quite a few inquiries. By the end of the year, I expect there will be disappointed parties who couldn’t secure a spot on Grafton Street
— Eoin Feeney, head of retail at commercial real estate adviser Colliers
The slow but steady revival of the street resumed in the middle of last year with Skechers signing a new long-term lease for the former Tommy Hilfiger premises. The international footwear giant is understood to have agreed to pay a rent of €900,000 per annum, or some 47 per cent less than the €1.7 million rent Tommy Hilfiger had been paying before it exited the property.
Several more of what Feeney describes as “best-in-class international brands” arrived on Grafton Street in the second half of 2022. These included the much-anticipated Lego store, which opened its doors in August at number 41. This was followed by Dr Martens’ move from 24 Duke Street to 83 Grafton Street, and the arrival in September at number 76 of high-end UK shoe and handbag retailer Russell & Bromley and of Irish cosmetic powerhouse Sculpted by Aimee to number 50/51, and Irish activewear brand New Dimensions to number 47 in November.
Thanks to these and other openings, the number of vacant units on Grafton Street dropped from 16 (11 per cent of total retail floor space) in December 2021 to just six units (5.4 per cent) at the end of 2022. And as the new year gets under way, that already low vacancy rate looks set to fall further with market sources reporting strong interest from a range of prospective occupiers including sportswear company Under Armour, sport and lifestyle brand Oakley, Japanese fashion retailer Uniqlo, household appliance giant Dyson, and The Fragrance Shop. British fashion retailer Monsoon is also understood to be keen to re-establish itself on Grafton Street, having closed its store there in 2020 as part of a wider restructuring of its business during Covid-19.
While Eoin Feeney refuses to be drawn on the names of those trying to find a pitch on the street, he says: “We’re down to not a huge amount of vacancy and [we have had] quite a few inquiries. By the end of the year, I expect there will be disappointed parties who couldn’t secure a spot on Grafton Street.”
Developed originally in 17th century as a laneway to link Trinity College and St Stephen’s Green, Grafton Street had earned its reputation as a prime shopping location by the middle of the 19th century with the openings of the Switzers and Brown Thomas department stores in 1838 and 1849 respectively. While Switzers, which was renowned for its Santa and Christmas window displays, closed for business in 1990 following its acquisition by the Brown Thomas group, its sign survives above the window on the Wicklow Street side of the Brown Thomas building.
Another long-standing name synonymous with Grafton Street is Bewley’s Café, which opened for business in 1927. That the “lofty, clattery, cafe”, as James Joyce described it, continues to trade today speaks volumes both for the brand itself and its importance as a fixture on the street. Having traded through the successive economic ups and downs of the newly minted State, Bewley’s Grafton Street flagship came perilously close to closing for good in the summer of 2020, with the company’s owners citing the impact of the pandemic on the economy and the €1.5 million annual rent they were paying to developer Johnny Ronan’s RGRE for the protected structure.
Planners are opposed to units being amalgamated on Grafton Street. I think, to be able to compete, there should be more flexibility in amalgamating units
— Eoin Feeney, head of retail at commercial real estate adviser Colliers
But while Bewley’s continues to bear the burden of the rental payments the Campbells effectively signed up for when they engaged in the sale and leaseback of the building to its previous owners, Royal Liver, in 1987, there is no such issue for the street’s other historic name, Weir & Sons jewellers, which bought its landmark premises outright in 1963.
The matter of retail rent and more particularly the rates applied on Grafton Street have generated plenty of headlines over the years. In 2022, Cushman & Wakefield’s Main Streets Across the World report, which aims to compare rental prices across 92 cities, ranked Grafton Steet as the 15th most expensive street on which to rent. It estimates the cost of rent to be €2,933 per square metre per year, a 17 per cent decrease on pre-pandemic levels.
For comparison, Avenue des Champs-Élysées in Paris is said to be the fourth most expensive in the world with rent costing €11,069 per square metre per year, while Upper 5th Avenue in New York is by far the most expensive at €21,076 per square metre. It is, however, important to note that methods of calculating rental prices vary greatly from country to country, making such comparisons difficult. Both Ireland and the UK value prime retail locations by zone, separating the area of a shop into four zones, with the first 20ft of a shop (zone A) deemed most valuable. The second 20ft of the shop (zone B) is valued at 50 per cent of the zone-A rate, the next 20ft (zone C) is valued at 25 per cent, and the remaining area (zone D) is valued at 12.5 per cent.
While Grafton Street’s repeated ranking as one of the most expensive retail locations in the world may be welcomed by those landlords anxious to maintain the valuations of their properties and by a certain cohort which derives satisfaction from the street’s inclusion on the list, it still faces major obstacles when it comes to attracting big-name brands.
Emma Coffey, head of retail at commercial real estate adviser Lisney, says while the street could yet achieve full occupancy, there is a potential issue regarding the size of the units currently available. “It’s down to who the individual retailers are and what requirements they have. It can be challenging to find retailers that want the smaller units,” she says.
In times past the street was deeply associated with Irish fashion. It will take clever thinking like Square on Grafton, where Irish brands collaborated in one space, for that to happen again
— Donal Fallon, historian
“Planners are opposed to units being amalgamated on Grafton Street,” adds Feeney. “I think, to be able to compete, there should be more flexibility in amalgamating units.” The street’s status as “an area of special planning control” also means certain uses, such as pharmacies and beauty premises, would have to seek planning permission.
Quite apart from those restrictions, the street’s fortunes are dependent on the volume of visitors to Dublin city centre in the wake of the pandemic. Footfall was at 89 per cent of 2019 levels for November 2022 and 87.5 per cent for December, says Richard Guiney, chief executive of business representative group Dublin Town. The numbers, while relatively healthy, reflect fewer office workers due to work-from-home arrangements. Commenting on the figures, he says: “Although the number of people on the streets is lower than pre-pandemic levels during the week, weekend numbers have recovered to a greater extent. Colleagues in other large international cities believe that 2022 will form a new base year with the belief that pre-pandemic patterns are unlikely to return.”
Despite this, Guiney is optimistic about the prospects for bricks-and-mortar retail generally, saying: “Research undertaken on behalf of Dublin Town indicates that online shopping may have begun to plateau, and while longer term levels of online sales are unlikely to drop below pre-pandemic levels, there is clearly strong engagement with physical stores.”
While the level of engagement with physical stores may still be strong, the relationship between Irish shoppers and Grafton Street, has, according to some, become strained over recent decades with suggestions that the street has lost its distinct identity and taken on the appearance of a UK high street. Historian Donal Fallon, author of Three Castles Burning, notes that historically it was more known for Irish design than it is today. “In times past the street was deeply associated with Irish fashion, for example designer Sybil Connolly worked in Richard Alan’s. It will take clever thinking like Square on Grafton, where Irish brands collaborated in one space, for that to happen again.”
The strength of shoppers’ engagement with Grafton Street doesn’t just rely on the brands that occupy its own units. It extends to the retail and food and beverage options on surrounding streets. In this regard, the street’s immediate environs have attracted renewed attention from some well-known brands, with bespoke pen and watchmaker Montblanc moving into a unit on South Anne Street, while luxury handbag maker Mulberry has recently signed a lease for a premises on Duke Street. On Chatham Street, high-end jeweller Paul Sheeran has agreed a deal to occupy the ground floor of Hines’ Chatham & King development. The new store will sell watches by luxury brands Hublot, Longines and Tudor, while Richemont stablemates Panerai, Cartier, IWC Schaffhausen and Jaeger-LeCoultre will operate own-door outlets from the premises along with TAG Heuer and Breitling.
On the other side of Grafton Street, meanwhile, footfall on the already-thriving Dawson Street is likely to increase with the arrival of two more major employers to newly developed offices on either side of the Luas green line track. Goodbody Stockbrokers is due to take up occupation across the street from its rival, Davy, of all 5,560sq m (60,000sq ft) of space in the former New Ireland Assurance headquarter building at number 12. The property, which has capacity for up to 600 workers, has been redeveloped by Paddy McKillen jnr and Matt Ryan’s Oakmount. It will also include a 930sq m (10,000sq ft) restaurant to be known as Hendersons at ground-floor and basement level, which McKillen’s Press Up Hospitality group will operate.
Separately, US-based software giant ServiceNow has signed a long-term lease for 8,360sq m (89,986sq ft) of the offices developed by BCP Asset Management and its partners, MARK, at 60 Dawson Street. Distributed across the top four floors of the scheme, the offices will provide ServiceNow with sufficient space for up to 900 workers.
Number 60 Dawson Street forms part of the wider Grafton Place development, which includes a large retail space at ground-floor level. Dawson Street’s status as a prime location in its own right and its value as a supplier of well-heeled shoppers to Grafton Street has been bolstered over recent years by the decision of several other blue-chip corporates, including Barclays Bank and US online retailer Jet.com, to locate there.
The street is also home to some of the city’s best-known restaurants and bars, including The Ivy, Marco Pierre White’s and Cafe en Seine.
