After 200 years, famous store's death knell sounds

More than two centuries of retail history will end next January when Dickins & Jones, the Regent Street institution, closes its doors for the last time. What was once one of the capital's most glamorous department stores has turned into a financial headache for the group that owns it, House of Fraser.

More than two centuries of retail history will end next January when Dickins & Jones, the Regent Street institution, closes its doors for the last time. What was once one of the capital's most glamorous department stores has turned into a financial headache for the group that owns it, House of Fraser.

The double blow of a massive rent increase and shifting shoppers' loyalties means Dickins & Jones has lost more than £1m in the past 12 months. John Coleman, House of Fraser's chief executive, said: "Once you're losing money, you're losing money; there's no place for sentiment." He hopes to offer the 500 employees jobs in its other London stores, which include House of Fraser on Oxford Street.

The building's lease, which runs until 2038, has been sold to a property developer for £4m. Shearer Property Group and Delancy Estates intends to replace Dickins & Jones' distinctive neo-classical frontage with a mixture of shops, offices and flats.

The decision to close the store, which moved into its home at 232 Regent Street in 1835, dismayed staff and loyal customers. Most will miss the chance of a quiet browse, away from the crowds of nearby Oxford Street. Maureen Hinton, an analyst at the retail consultancy Verdict, said: "It's gone off the boil completely. The store has really low footfall. There is hardly ever anyone in there. Most people just use the building as a cut-through."

The trigger for the store's closure came three years ago when its landlord, Legal & General, hiked the rent tenfold to £2.5m a year, way above market rates, because the next rent review is not due until 2038, when the lease expires. As with the rest of Regent Street, the Crown owns the ultimate freehold. The rent increase has "killed the store", Mr Coleman added. "But we have always said there are no sacred cows in our business."

Dickins & Jones' history dates from the 1790s when Thomas Dickins was apprenticed to a draper in Worksop, Nottinghamshire. In 1803 he teamed up with William Smith, opening a linen drapery shop at 54 Oxford Street, Dickins & Smith. The addition of a third partner, Joseph Stevens, meant that it was as Dickins, Smith & Stevens that the store moved into its Regent Street home three decades later.

That was the start of the shopping hub; under the aegis of John Nash, the architect, the area between Piccadilly and Oxford Circus got a new lease of life as a high-class shopping promenade.

In 1856, the store was rechristened Dickins & Jones and thanks to the emergence of a new suburban middle class, it went from strength to strength. By the 1890s it was rivalling even Liberty for its selection of in vogue Oriental accessories and giftware. The Regent Street site as we know it today was built in the early 1920s at the cost of £1m, or £30.5m today. The Argyll extension was added in 1939 and the tea dances in the building's Dome Restaurant were legendary. The store became part of the Harrod's Stores in 1914, after Thomas Dickins' grandsons showed no interest in joining the family trade. House of Fraser bought Harrods in 1959, gaining Dickins & Jones. Two other Dickins & Jones, in Richmond and Epsom, will stay open although eventually, as House of Fraser refurbishes its estate, the name will die out.