RETAILMARKET:A GROUP OF property owners on Grafton Street are urging Dublin City Council to overturn restrictions that exclude certain retailers from trading on the street.

The owners and landlords, who control over 40 out of the 94 shops on the thoroughfare, will make their opposition clear in a submission to the council's 12-month review of the scheme, which is expected to be carried out within the next six to eight weeks.

Councillors will then have the opportunity to discuss the submissions and a resolution may, as a result, be tabled to amend or revoke the special planning controls introduced last April following concern over the street's deteriorating character.

Under the new restrictions mobile phone shops, convenience stores and fast food outlets are among 16 retail uses banned from the street. A further five, which include pharmacies, health food stores and souvenir shops, require special planning permission.

In their submission the landlords will argue market forces alone should determine Grafton Street's retail mix and that the council's intervention is damaging the area's long-term business prospects. Mervyn Ellis, a director with the HWBC agency, who is negotiating on behalf of the group, warns that values for smaller units on the street may come under pressure if the planning restrictions on certain retailers remain in force.

It is the second time institutional property funds and developers have united behind this issue. A submission was made prior to the scheme's introduction last year, but councillors voted overwhelmingly to adopt the planning restrictions. The group includes Irish Life Investment Managers, Friends First Life Assurance, Treasury Holdings, AIB Investment Managers, Bank of Ireland Asset Management, Hibernian Investment Managers and Irish Property Unit Trust.

While there is considerable support for the planning restrictions among established traders on the street, such as Brown Thomas and Weirs, as well as the merchants' organisation, the Dublin City Business Association (DCBA), few in the property industry have warmed to the scheme. And there is some evidence the restrictions are beginning to bite. According to a well-placed source, the new planning restrictions persuaded the souvenir chain, Carroll's Gifts, to abandon its €850,000 deal to acquire Footlocker's lease at 44 Grafton Street last June. The firm subsequently opened a store nearby on Suffolk Street.

For those in favour of the council's scheme such an example is likely to be held up as a reason to maintain the restrictions. But many property agents, like Aiden McDonnell of Colliers Jackson-Stops, argue the scheme's ban on certain traders is "misguided" and fails to address the key problem facing Grafton Street - its shortage of large-scale retail units. He points out that the jumble of shops on the street are unsuitable for most upmarket retailers and until this supply crunch is eased "market share in the city centre will continue to be lost to suburban town centres".

According to McDonnell, there are just five units on Grafton Street of sufficient size for most fashion retailers. "The rest are under 5,000sq ft and are awkward in their layout, and the major fashion brands simply refuse to trade out of these sort of units."

This is a long-running sore for many in the property sector, with experts like McDonnell pointing out that the council's focus should be on how to amalgamate some of the smaller units into single, large-scale shops that would appeal to top fashion brands.

But Tom Coffey, chief executive officer of the DCBA, says this argument would "kill off the area's exclusivity" and do little for the street's tourist credentials. "What these people don't understand is that the smaller properties give the street its character."

Coffey also claims a recent survey carried out by his organisation shows a majority of consumers "prefer the variety of the city centre" and find shopping malls, where there are larger floorplates, "bland and boring".

Yet two years ago leading commentators were bemoaning the street's rapid descent into mediocrity. Years of exorbitant rental increases had culled the street of most of its indigenous traders while mobile phone shops and convenience stores seemed to be spreading throughout the area like a contagion.

According to David Andrews, chairman of the 19th century jewellery store Weir & Sons, "Grafton Street today doesn't look very much different from Grafton Street two years ago". So have the restrictions had any material impact? "I think these planning schemes take years to have a sizeable effect. What we can say is that it has stopped the spread of certain retailers. And there is no doubt that action was needed because Grafton Street patently wasn't living up to its reputation as the city centre's most attractive and colourful shopping area."

However, as the recent spate of letting deals indicate, the street's shopping mix is set to change. American giant, Tommy Hilfiger, will trade out of a new unit created by M & S from the former Grafton Street Arcade. The space to the rear of that former mall has now been added to the UK chain's flagship store, and the company will unveil the extension, including a rooftop restaurant with views over Grafton Street, next month.

Meanwhile Swatch is moving into a small unit near the St Stephen's Green end of the street. A major new tenant is expected for the Nine West store, while Warehouse's unit is likely to be taken over by one of its sister fashion brand's, like Coast or Whistles.

However the real coup will be the arrival of jewellery icons, Tiffany & Co and Cartier, at Brown Thomas. The upmarket department store is relocating its ground floor menswear department into the basement to make way for the luxury brands, which have long been on the lookout for potential properties on Grafton Street. It is understood the new jewellery emporium will open later this year.