Old lady going over commercial area in Spanish city (7)
I believe the answer is:
granada
'spanish city' is the definition.
(Granada is a city in Spain)
'old lady going over commercial area' is the wordplay.
'old lady' becomes 'gran' (short for grandmother).
'going over' is a charade indicator (letters next to each other).
'commercial' becomes 'ad' (abbreviation for advertisement).
'area' becomes 'a' (maths abbreviation).
'gran'+'ad'+'a'='GRANADA'
'in' acts as a link.
(Other definitions for granada that I've seen before include "car in > Spanish city" , "Andulasian city" , "City of Andalusia" , "Andalusian city" , "Spanish city, site of the Alhambra" .)