UK Commercial Property Trust (UKCPT) and Shearer Property Group is beginning work on The Parade Shopping Centre in Swindon.
UKCPT, which owns the site, is sending the bulldozers in to demolish the existing Bhs store in order to make way for 80,000 sq ft of prime new retail space.
This new space will include a 45,000 sq ft store for Bhs with six additional retail units.
Top Shop is to take the unit on the corner of Bridge Street and The Parade will form a new 10,000 sq ft flagship store. River Island is taking another 9,000 sq ft store, leaving only four units vacant.
The development was granted planning consent by Swindon Borough Council in May last year and is expected to have an end-value of £25m once it is completed.
Bhs will close its existing store for trade this month and relocate temporarily to the former Woolworths store in Regent Street until the new store re-opens in Spring 2011.
Top Shop will open in late 2010.
Robert Boag of Ignis Asset Management, fund managers for UKCPT, said: ”I am pleased that the hard work for all concerned is about to manifest itself in the start of the redevelopment work.
“The creation of modern retail space for Swindon will attract other retailers to the town, which the shoppers in Swindon deserve. It ensures that the focus of retailing for the town will continue to be The Parade.”
Guy Shearer, founder of joint venture partner Shearer Property Group, said: “In this challenging economic climate, we are delighted to announce the commencement of this important redevelopment – it will transform this prime corner in the heart of Swindon’s retail hub.
“The news that Bhs, Top Shop and River Island will all take new flagship stores demonstrates retailer confidence in the future of Swindon.”