CROYDON COMMENTARY: The decline of Allders is partly a story of Croydon itself. ANDREW PELLING looks at the council’s role in the final days and asks if more could have been done by the Town Hall to save the near-1,000 jobs at the department store
Major public policy errors, a breakdown in confidence in policing in central Croydon, poor road access, a lack of vision at the Town Hall and the fatal blow of the 8/8 riots underpinned a trend of decline for the once grand department store that can be traced back nearly 50 years.
The Department of Transport gives up plans for the M23 to reach Mitcham and Streatham, so cutting Croydon from direct access to the new motorway network. Motorway to finish at Hooley with only moderate improvements to be made in following years on the A23. Industrial jobs begin to leave the Purley Way, leaving space for later retail development in competition with town centre-based stores, including Allders.
One of Croydon town centre’s department stores, Kennards, is folded into Debenhams.
Queensway furniture stores opens out of town on Thornton Road.
MFI Furniture store opens out-of-town.
Payless DIY opens on Purley Way.
Grants department store closes.
Do It All out-of-town store opens.
M25 orbital motorway south of Coulsdon is completed, accelerating the move of companies to outside Croydon, especially from Purley Way, leaving room there for more out-of-town retail developments.
Abolition of local business rates undermines Croydon’s competitive position with business.
1990 – 1994
A departing Conservative Council unsurprisingly fails to persuade Purley residents to build a flyover through the town.
IKEA Store opens on old Croydon B power station site in 1992.
After stock market listing in 1993, Allders goes for major expansion, buying other stores and branching out into airport tax-free shopping.
The Bluewater mall opens in Kent, drawing away shoppers around the M25 instead of visiting Croydon.
With strong backing from the Croydon Advertiser, the council’s ruling Labour group starts work on planning a 12,500 seater Arena next to East Croydon Station. To do so, they seek to displace the debt-free owners of most of the site, Stanhope – who had successfully re-developed Broadgate in The City. The Labour council backs the smaller Arrowcroft and Stradivarius.
Lehman Brothers, the merchant bank, and Minerva, a property company, buy out Allders.
House of Fraser opens in what was first called the Drummond Centre, then re-named Centrale. The store is cursed by poor footfall and eventually secures much lower rent levels.
Having paid well over the odds for Allders, the new owners seek offers but none are found.
Allders goes into administration for the first time, short-changing its pensioners with £15million hole in its pension fund.
Bluewater introduces ban on swearing, clothing that obscures the face and groups of more than five without the intention to shop. Unlike Croydon.
A group lead by Howard Tillman buys Allders Croydon. Uncertainty over possible relocation to Minerva’s proposed development at St George’s Walk and limited funds mean that much-needed capital investment in the store is limited.
Before Labour loses control of Croydon Town Hall at the council elections that year, they sell-off the borough-owned car parks to NCP, whose parking charges are twice those of car parks in Bromley and 66 per cent more than those prices charged by Sutton Council. Conservatives say that this damages Croydon’s shopping centre prospects.
Once elected, the new Conservative administration at the Town Hall goes back on promises to drop the Arena scheme. The uncertainty sees John Lewis and prospective developers of the area between East Croydon and Wellesley Road continue their wait to see whether they should invest in the town’s redevelopment.
Minerva is the potential developer of St George’s Walk, with John Lewis touted as the likely key tenant.
Local media creates an image of Croydon as “The Cronx”, an unsafe centre of gang crime, muggings and stabbings. Headlines that DSN – the 100-strong “Don’t Say Nothing” gang – has declared Croydon town centre as its territory discourages shoppers coming to the area.
Croydon Advertiser runs headline “Gang bans rivals from town centre”.
“Croydon’s biggest gang has banned its rivals from the town centre, it has emerged this week. Don’t Say Nothing (DSN) has proclaimed Croydon its ‘turf’ and the recent escalation in gang warfare locally is understood to be linked to this ban.
“Other gangs are said to have defied the warning and that is said to have caused town centre fights and even a recent stabbing at East Croydon Station. North End has become a particular flash-point as DSN sees this as the heart of its turf.
“News of the ‘ban’ came at a Croydon Youth Court case last Friday where a 15-year-old boy appeared charged with affray over a town centre battle caught on CCTV. He was captured on film fighting with a broom from a streetsweeper’s trolley as groups affiliated to DSN and Thornton Heath gang Straight Merking (killing) Niggas, also known as SMN, clashed. His opponent, who was knocked to the floor in the brief fight at 6.30pm on January 5, wielded a shovel also taken from the roadside.
“Olivia Kong, prosecuting, said that in a police interview the youth – who cannot be named for legal reasons – said there was an ongoing dispute between DSN and other gangs.
“She told the court: ‘He said DSN proclaimed Croydon as their turf and other gangs should not enter Croydon. This has caused problems as a number of other gangs have challenged this belief’.”
An 18-year old boy is assaulted by an axe-wielding gang who thought he was the leader of DSN. Police criticised for being reluctant to record the crime and indeed recording of such crimes restricted, as gangs prefer not to deal with the police.
Although a by-pass has been built around Coulsdon (a plan initially proposed in the 1944 Abercrombie Plan), London Mayor Ken Livingstone’s plans to improve the A23 traffic flows at Purley fail on resistance of local residents backing on to Tesco’s and the indifference of Croydon South MP Richard Ottaway and Purley councillors.
Croydon Council is revealed to have spent £1 million on a controversial public inquiry into their attempted Compulsory Purchase Order on the East Croydon Gateway site to evict Stanhope and place an Arena there. Secretary of State Hazel Blears rejects the Arena idea “In light of uncertainty about the viability of the scheme”.
This comes too late for Stanhope to start its planned development, as the global financial crisis grips the economy. Stanhope is unable to agree terms with Nestle to act as the anchor tenant for its scheme. Croydon Council also declines to be the anchor tenant preferring to build a Council HQ that it would eventually own, choosing to enter into a joint venture with a private equity company that will benefit from the increased value of properties that the council might own and on which the council will provide itself with value-enhancing planning permissions and so provide the joint company with windfall profits.
Minerva is struggling as a company and its proposed development at St George’s Walk remains stalled. It is dragged into the Cash for Honours scandal as the Labour government is accused of not calling in the planning application there for a company where former Minerva executives have given large loans to the Labour party.
Minerva keeps a 160-pence per share bid for the company at bay.
Following the drive-by shooting of an innocent victim in Derby Road, gangs are reported to increase their stock of guns to be used in central Croydon.
In February, a 16-year-old boy is stabbed four times in gang fight in Centrale as DSN fights the Gipset gang.
Internet sales secure 8 per cent share of the UK retailing market.
After forming a coalition following the May General Election, the Conservative-LibDem government cancels a £71 million regeneration programme for Croydon.
Minerva keeps a 50p bid for the company at bay, but then share trades like a penny stock, so limiting chances of a boost to Croydon with redevelopment at St George’s Walk. Vacated shops are re-let on short-term or near-to-zero rent lets.
March 23, 2011
Hammerson buys Centrale from St Martins Property Investments Limited, as part of the company’s transformation from office property to retail property company.
August 8, 2011
After two night of rioting, looting and arson elsewhere in London, fires arising from the riots at Reeves Corner and in London Road draw international media attention, damaging Croydon’s reputation.
Allders’ own security staff have to defend the store from looters.
Major stores report that over an extended period following the August riots, retail sales fall by up to 70 per cent. Some stores continue to suffer from a severe takings downturn.
Despite the local MP’s and the Mayor of London’s enthusiasm for the idea, Croydon Council decides not to pursue an Enterprise Zone with tax breaks as they don’t wish to lose some of their planning powers.
A £23 million riot recovery fund is promised for Croydon by the Mayor of London. Much of the money is diverted by the council towards paying expensive consultants and to pay for already planned pedestrian crossings on the Wellesley Road.
November 10, 2011
The Whitgift Foundation enters into an exclusive arrangement with Westfield to re-develop the Whitgift Centre, and thereby antagonises its two leaseholder partners who throw in their lot with Hammerson. The deadlock is hauntingly similar to that which stopped development at East Croydon.
The local MP, Gavin Barwell, implies that as a Whitgift Foundation governor that he was aware of the “behind the scenes” work with Westfield.
The uncertainty makes a future rescue of Allders difficult.
January 5, 2012
Nestle announces decision to leave Croydon after suffering a poor relationship with Croydon Council’s senior management and disagreements over their desire to find a suitable new headquarters in Croydon.
Town Centre policing is halved, further undermining confidence in safety of shopping in Croydon.
A Plain English guide to the Localism Act says of a new discretion for councils: “One of the most important things that councils can do to improve local life is to support the local economy. The Localism Act gives councils more freedom to offer business rate discounts – to help attract firms, investment and jobs. Whilst councils would need to meet the cost of any discount from local resources, they may decide that the immediate cost of the discount is outweighed by the long-term benefit of attracting growth and jobs to their area.”
Croydon Council fails to use these new powers.
Lack of continuity in dealing with local businesses by the Town Hall is shown by Mike Fisher, the leader of the Conservative group that controls Croydon Council, when he appoints a new cabinet member for business, the fourth to hold the position in just three years.
June 15, 2012
Allders enters administration for a second time. Some concessions reveal that they had not received their takings from the store’s management for three months or more.
To the consternation of business leaders, Fisher concentrates on attacking the Alllders management rather than assisting in saving jobs.
The council claims publicly that it was approached about Allders’ difficulties only two days before the administrators called in. Sources close to Allders claim that the had approached the council seeking rate relief months earlier.
The exodus of jobs from Croydon continues when Bank of America Merrill Lynch says it’s leaving the borough.
August to September 2012
Three bidders look to buy the failing store but all fall by the wayside. Croydon Council offers rate relief only two days before Allders finally folds, and then only with major due diligence constraints that make a deal with new investors impossible to complete.
The slow-moving Minerva turns down a bid from the top bidder for the leasehold of the Allders store. It is likely that they hope for a higher bid in the future from the freeholder, the Whitgift Foundation, when the Hammerson-Westfield uncertainty is resolved.
With 1,000 jobs under threat, Croydon Council offers to co-ordinate the public sector’s response to try to find jobs for redundant staff.
September 22, 2012
Allders to cease trading. With administrators selling internal fittings, the store has no future. Concessions told to leave a week before closure.
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- Westfield swoops in early with planning application for Croydon (insidecroydon.com)
- United we stand: looking for a more representative Croydon (insidecroydon.com)