Council pays M&S to surrender lease on former Stall Street store

Bath & North East Somerset Council is paying Marks & Spencer to give up the 36-year lease that remains on the retailer’s old Stall Street store, it has emerged.

The former Marks & Spencer store on Stall Street

M&S, which relocated to the former Debenhams store in SouthGate earlier this year, has no intention of investing long-term in the site, of which the council owns the freehold.

Not wanting the ageing building to stand empty, the “urgent” decision has been made to take it back so a new lease can be granted to support city centre regeneration.

The decision, taken by the council’s cabinet member for resources Councillor Mark Elliott, is not open to scrutiny by councillors.

It is revealed in a report published on the council’s website from which information is exempted – including any reference to the company by name.

The report says: “The council owns the freehold of a site, which is currently subject to long leasehold interests with just over 36 years unexpired. The current rent payable to the council is modest and materially below market levels.

“Part of the property has been sublet by the tenant, while the remainder of the building is obsolete and requires significant intervention to support the vitality of the city centre.

“The current tenant has relocated and has confirmed that it does not intend to undertake any long-term investment in the site. The remaining lease is too short to be of any interest to a developer.

“The existing leasehold structure therefore restricts the council’s ability to intervene, improve or regenerate the asset.

“The council preferred approach is to regain control of the site to enable redevelopment by a third party through onward disposal of part or the whole of the premises.

“Although this involves a payment of a reverse premium, it would address the obsolescence, secure planning consent and enable redevelopment consistent with the council’s city centre regeneration strategy, as outlined in the council’s adopted Local Plan and Placemaking Plan.”

It adds: “Early exchange prevents the tenant from reconsidering or withdrawing their agreement, which would undermine the council’s ability to progress the redevelopment opportunity.”

The transaction includes a completion backstop date of 4th December, by which time the council must have secured a developer willing to take a long lease and enter into a development agreement.

The premium payable by that developer is expected to fund the reverse premium due to the tenant.

A new tenant and the length of a new lease are yet to be determined, the report adds.

It also notes that “redeveloping this outdated building offers the chance to deliver a modern, energy?efficient property that aligns with the council’s commitment to achieving net zero by 2030”.

On the reason for keeping information exempt, the report says: “It is in the public interest that the council is able to deliver cost-effective solutions.

“This depends partly on the council being able to protect its commercial position while the detailed terms of relevant schemes are agreed.”

M&S first announced plans to relocate from Stall Street in the summer of 2024.

In November 2025, the council told the Echo that M&S was holding a long lease of the existing premises, which still had a “very significant period” left to run, so any decision over the future use of the building would rest with the retailer.