'Welcome to my railport'

[John Ashworth]

Welcome to my railport: Network Rail is converting stations to airport-style shopping hubs (but don't worry, there will still be trains)

By ALEX HAWKES
PUBLISHED: 21:13 GMT, 17 March 2012 | UPDATED: 21:13 GMT, 17 March 2012
This is Money

As 350 guests tucked into canapes and enjoyed a spectacular light show last week to mark the opening of the new western entrance of King’s Cross station, Network Rail bosses were hoping for more than just a smoother journey for the 47million passengers who use the station every year.

The £550million upgrade of a key part of Britain’s rail infrastructure, which includes a striking semi-circular vaulted steel roof, is a vital part of a long-term strategy to make stations not just travel hubs but also shopping malls.

Gavin McKechnie, Network Rail’s head of retail, says: ‘We want people to shop, sit, eat and relax. From where you are eating you can see the customer information screens and see where the platforms are.

Immediately, you are relaxed – you could be in Carluccio’s and think, “I’ve got time. I’ll have another glass of wine.” ’

McKechnie, 49, who was brought in after a career at BAA, whose airports are often described as shopping malls offering flights, is the brains behind the strategy of taking railway station retail upmarket.

The redeveloped St Pancras was the first station to get the treatment, but it was not an immediate success, McKechnie admits. In 2007, the Queen had to open a shopping area that had only three shops. But St Pancras has thrived since and Network Rail is bucking the retail trend.

Last month it said retail sales in stations had grown 2.35 per cent on a like-for-like basis in the last quarter of 2011, compared with a year earlier. And this at a time when High Street retail has been stagnating.

McKechnie says the aim is to recreate the success of airports with shops.

‘At an airport, 60 per cent of passengers will spend money. On the railways it is five per cent,’ he says.

Heathrow has the highest retail spending of any airport in the world with 70 million passengers a year, who spend nearly £6 each visit.

But McKechnie says: ‘I have 70million passengers a year in Euston alone. Because the numbers of people who travel on the railways are so big, the levers we have need only to be tweaked a bit to make a big difference.’

The retailers in the new King’s Cross station reflect the upmarket move. Out go Burger King and McDonald’s and in comes healthy fast-food brand Leon. ‘Our customer research says you need fast food, but it doesn’t have to be burgers,’ McKechnie says. Child-friendly Giraffe has an outlet in the new station, as does Patisserie Valerie and Lebanese restaurant Yalla Yalla.

There are still station essentials, including WH Smith and Boots, but also designer stationery brand Paperchase and upmarket pharmacy Kiehl’s. King’s Cross is the latest of several stations being given a retail overhaul by McKechnie’s team.

Later this year a redesigned mezzanine balcony will open at Waterloo station, where bankers heading home will be able to drink at a new branch of City wine bar Corney & Barrow. There will also be a Pizza Express, the first in a station.

And Network Rail is working alongside Birmingham Council to overhaul the Pallasades shopping centre above Birmingham New Street station, which will see John Lewis open its first shop in the city. Manchester Piccadilly now has a Carluccio’s and a YO! Sushi as part of a broader overhaul.

Before coming to Network Rail, McKechnie spent two years running Delhi International Airport. Before it was revamped with the building of a new domestic terminal, the facilities amounted to a man selling tea in the car park. ‘As soon as we put retail in, it just flew. We were 200 per cent up on expectations,’ he says.

McKechnie is steeped in retail. He started out as a McDonald’s graduate trainee and did stints at Argos and Kingfisher, owner of B&Q.

Married with two children, a daughter of 18 and a son, 14, McKechnie is based in his native Scotland, travelling home every weekend to Livingston, West Lothian. He holds a Celtic season ticket and is proud that his son plays for the Airdrie youth side.

McKechnie becomes animated when he talks about the retailers that might be tempted into the Britain’s stations. ‘Apple would love to open a store with us, if we could provide the right space,’ he says.

But he is also realistic enough to know that travellers want more from a well-run station than shopping: ‘We are a railway station, we are there to get people in and out of trains.’