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Why is Marks & Spencer closing its main Aberdeen store?

Many of us suspected it would come to this.

M&S on St Nicholas Street, Aberdeen, in 2002.
M&S on St Nicholas Street, Aberdeen, in 2002. Image: Rory Raitt

So, after what seems like years of speculating over its future, the end of Marks & Spencer (M&S) just off Union Street in Aberdeen is really happening.

Many of us suspected it would come to this, despite M&S insisting no decisions had been made about the Granite City as it rolled out a raft of store closures across the UK.

But the writing was on the wall for the St Nicholas Street shop as soon as it became clear town and city centre sites were not a priority in the retail giant’s future plans.

It has instead been investing in larger, out-of-town locations.

Another huge gap to be filled in Aberdeen’s dwindling retail estate

M&S calling time on its St Nicholas Street shop, anchor to the Bon Accord shopping centre, will leave another large, vacant hole in Aberdeen’s city centre retail estate.

Union Street and its environs have already suffered the loss of Frasers, BHS, Debenhams, John Lewis and many more.

But there are silver linings here – there will be no job losses and staff at the shop earmarked for closure will most likely move to a hugely expanded, flagship store in nearby Union Square.

M&S will have a bigger and better store at Union Square.
M&S will have a bigger and better store at Union Square. Image: M&S

M&S is investing £15 million at Union Square, where it’s revamped store, taking in the current TK Maxx site, will be nearly double the size of the current food and homeware shop.

In just over a year from now Union Square will boast the fourth largest M&S in Scotland.

There are also M&S Simply Food stores elswehere in the city, plus a few smaller petrol station convenience outlets.

Meanwhile, those of us living in Aberdeenshire can get our fix of Percy Pig treats at Simply Food stores in Westhill and Inverurie.

There had been fears over the future of the St Nicholas Street store ever since Union Square opened in 2009.

And M&S shut its branch on Sauchiehall Street, Glasgow, in April 2022, sparking further concerns about Aberdeen.

A later results statement from M&S warning of more UK closures fuelled fears about yet another exit of a major retailer from the city centre, following the loss of John Lewis and Debenhams, among others.

M&S owns the premises on St Nicholas Street and that site will now have to put up for sale.

Who knows what its future holds.

For M&S, shutting “legacy” stores like the one at that end of Union Street leaves it to focus on a bigger food store format and in some cases click-and-collect services for clothing and homeware.

Alongside its shop closures in recent years, the company has also been relocating stores and opening new, more efficient outlets.

Outlining a key part of its strategy in 2022, M&S said: “We are now developing a growing pipeline of store relocations, moving from old multi-floor buildings, often with challenged fabric and poor access and car parking, to modern, well-located sites wherever possible.”

It added: “Ease of shopping and fast access is critical to competitiveness, and in many cases we believe the town centre locations have lost impetus as a result of failed local authority or government policy.

“As a result, a high proportion, but not all, of our relocations are to the edge of town.”

In common with many other parts of the UK, the heart of the Granite City has seen the exit of many big-name stores in recent years. Negative factors impacting the high street include an uncertain economic environment and stiff competition from online retailers.

Tackling the challenge head on

But steps are under way to turn around Aberdeen’s retailing fortunes.

These include the Our Union Street campaign chaired by local businessman Bob Keiller.

He described the public response to the initiative as “overwhelming” after more than 10,000 ideas were submitted to his team.

Our Union Street leader Bob Keiller on Union Street.
Our Union Street leader. Image: Kenny Elrick/DC Thomson

Whether business rates were a factor at all in M&S deciding to shut one of its two Aberdeen city centre sites is unknown.

Just over a year ago the retailer gave a thumbs up to rates being slashed at its St Nicholas Street store. Following a rates revaluation, the site was expected to  see its rates reduced by around 51%, from around £523,000 to about £254,000 annually.

It’s not just a sandwich – was lunchtime shopping a factor too?

One likely culprit in the St Nicholas Steet shop’s demise is the impact of post-Covid working from home on the city centre.

Fewer people commuting into the heart of Aberdeen on a daily basis has hit shops, pubs and restaurants hard.

Did a drop in the number of people popping in for a sandwich and perhaps some clothes shopping contribute to the end of M&S’ biggest store in the Granite City?

It’s the end of the line for M&S on St Nicholas Street.

Festive season trade across the M&S chain was good, with food sales up nearly 10 % in the 13 weeks to December 30. Clothing and homeware sales grew by 4.8% over the same period.

Staff in Aberdeen have reported bumper sales in the run-up to Christmas.

But longer term trends may have forced the retailer’s hand in Scotland’s third largest city.

And what next for Union Square?

Another big unknown is whether the huge investment by M&S in Union Square, likely driving a significant increase in shopper numbers there, will have any impact on a potential sale of Aberdeen’s largest shopping centre.

Property giant Hammerson has been trying to sell Union Square.

Reports in August 2022 said it was being sold to property investor Brookfield, owner of London’s Canary Wharf development, in a £140m deal. But the transaction fell through.