The billionaire who will have a huge say on the future of shopping in Cardiff
It takes a good few minutes to traverse the site of Howell’s, the historic home of Cardiff’s House of Fraser branch, such is its size.
Its Grade II-listed four-storey frontage looms over the city’s St Mary Street. On the opposite flank, numerous exits spill shoppers out on to The Hayes.
As of this month, the site is controlled by the billionaire businessman Mike Ashley.
At the start of August he acquired House of Fraser in a deal worth £90m, taking on all of the retailer’s UK stores, the brand and all of the business’ stock.
Yards away, in the older part of the St David’s Shopping Centre, Debenhams isn’t quite the anchor tenant, but it’s not far from it.
As you enter from the newer part of the development, the entrance yawns to your right. Beyond it lies a huge store that dominates the southern part of the older section of this shopping centre.
Debenhams is just under 30% owned by Mr Ashley. Any more, and he’ll be obliged to launch a formal takeover bid.
On the ground floor of the adjacent new St David’s is the 26,759 sq ft Sports Direct store.
It might not look massive at ground level, but anyone who has spent time hunting for arcane sports kit in its cavernous basement will appreciate how easy it is to get lost in there.
Alongside Adidas, Nike and Puma, it stocks brands like Firetrap and Kangol. Mr Ashley owns them and the chain that sells them.
Elsewhere in the centre, you’ll find USC and Game. They’re owned by Mr Ashley too.
Since the new section of the St David’s Centre was opened in 2008 at a cost of £675m, most of the city’s chain stores have been drawn across from their previous locations in other parts of the city centre.
Churchill Way and the eastern parts of Queen Street are now largely bereft of big retail brands. One of the few remaining on Churchill Way is Flannels. Guess which firm has a 51% stake in that?
In fact if you go on the House of Fraser website, which is currently inactive, a pop-up says “In the meantime... browse the latest luxury fashion from selected designers at www.flannels.com”.
Mr Ashley also has partial stakes in a number of other high-street chains, such as lingerie firm Agent Provocateur and French Connection.
It might seem to be a bit heavy to put the fate of retail in Cardiff city centre on the shoulders of one man, but Mr Ashley, through his recent acquisitions and reported plans, will have a huge say in the future of shopping in the capital.
And it is not just Cardiff – he will have an impact on cities and towns across the UK.
So why does this all matter?
It is not a leap to speculate that Mike Ashley might consider bringing some or all of his businesses together under one roof. Why pay four or five lots of rent and rates when you can pay just one?
It is believed he is in discussions with the landlord of the House of Fraser building in Cardiff.
Mr Ashley has previously said he intends to save around 80% of the House of Fraser sites from closure. The Cardiff site had been earmarked for closure by its previous owners – now its fate is unknown.
Cardiff ’s branch of House of Fraser is a profit-making store. This is one reason why the building’s landlord was shocked that it was on the list of stores to close.
There is plenty of unutilised space within the building. Over the years House of Fraser has shrunk its footprint within the iconic store.
Should Mr Ashley reach a deal with Azeemeh Zaheer, the CEO of Naissance Capital, who is the owner of the building, and keep House of Fraser as a tenant, he might look to bring in some of his brands. He could even refurbish and use the basement and the second and third floors.
When Mr Ashley took over House of Fraser, he declared he wanted to make it the “Harrods of the High Street”. Well, the prestigious city-centre building with its ornate facade fits that billing very well.
His acquisition of USC, the cur-
rent disputes with creditors and stockists involved in the House of Fraser deal and the huge controversy over the treatment and payment of staff at the Sports Direct warehouses show Mr Ashley is not one for sentimentality when there is a deal to be done and money to be saved.
If you take a look at the House of Fraser building in Google Maps, you can see that it is in fact many buildings joined together – and therefore, theoretically, would not be hard to split apart to house different businesses or stores all operating under the Sports Direct banner.
It would be a radical step, but if Mr Ashley was to do this it would be see a huge change to Cardiff’s city centre.
St David’s Shopping Centre would lose a tenant taking almost 30,000 sq ft, along with smaller units home to USC and Game.
Filling these units would be hard. There are already plenty of empty stores in the centre, some cleverly hidden by decorative hoardings.
If Mr Ashley was to take over the department store and merge the two brands, then he might decide – or even be made – to close one of the sites due to competition and merger regulations.
This would mean that either the huge square footage of the Debenhams store in the St David’s Centre or the House of Fraser store would suddenly find itself without a tenant.
So does this make Mr Ashley the saviour or destroyer of the high street?
It is a difficult question to answer. With so many retailers struggling (a week rarely goes by without a bigname chain talking about closures or CVAs), the shrinking of the high street seems an inevitability.
Therefore is Mr Ashley looking at managing this shrinkage and using it to his own advantage?
What it does mean is that one man is controlling a large number of major retailers. He has the destiny of the city centre, plus many others across the country, in his grasp.