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Crisis for Labour as Hammersfield admits delays until 2019

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Croydon’s new council’s hopes of the £1 billion Hammersfield shopping mall development being built and on-stream speedily took another blow last night when an invited audience of local businesses was told that the scheme would not start construction until 2016 – a year later than planned – and will not be completed now until 2019 at the earliest.

One of Westfield’s imagined views of how the new mall might look: much of this area will be closed off for building works for three years – beginning now in 2016

That means that the Labour group, which won control of the Town Hall in May and pinned their hopes on the Westfield and Hammerson redevelopment of the Whitgift and Centrale shopping centres to regenerate the borough’s fortunes, will now have to endure the town centre as a building site throughout their four-year term.

This ought not come as any surprise. In April this year, Inside Croydon accurately predicted: “It is the nature of these large-scale projects that they over-run, in terms of time as well as costs”. Last night’s down-played announcement simply confirmed what had been suspected by realists and pragmatists for some time.

Nonetheless, it will be doom-ladened news for Croydon’s ruling Labour group.

Any public and commercial backlash for the inconvenience and disruption during the construction period is likely to come at a considerable political cost for Labour’s council leader Tony Newman and the Whitgift Foundation board member in his cabinet, Toni Letts.

Westfield director John Burton: “We are not a panacea”

It will also deny cash-strapped Croydon Council, left with the legacy of a debt “black hole” (copyright Mike “#WadGateFisher) of more than £900 million by the previous Conservative administration, with a longer wait for the business rates and other economic benefits from the Hammersfield development.

No reason has been given for the delay in the start of construction until 2016, though it seems likely to be caused because of the persistent legal challenges presented to the scheme by some of the current leaseholders and freeholders in the Whitgift Centre, notably rival property owners Minerva, who retain a substantial interest in the key Allders department store site.

In February, there will be a planning inspector hearing on the status of the more than 100 Compulsory Purchase Orders, taken out on property in the Whitgift Centre by the council on behalf of Westfield and Hammerson. This may yet cause further delays.

Last night’s reception held by the Croydon Business Improvement District at Hampton by Hilton was given the bad news about the delay by Hammerson’s Peter Cole and John Burton, the Westfield director who spoke at the recent election campaign launch of Gavin Barwell, the MP for the Whitgift Foundation, the owners of the majority of the freehold of the Whitgift Centre.

Six months ago, a bullish Burton greeted Croydon Council’s announcement of the CPOs by stating that it was, “Full steam ahead”. Now, it seems to be “stop all engines”.

One Katharine Street source told Inside Croydon, “This is big news and very bad news for Labour at the local elections in 2018.

“Labour needed the extra income on business rates that the scheme offered as soon as possible, with real crisis in council’s budget by 2017 unless other bailout from government.”

Burton dismissed Croydon BID members’ concerns about the disruption to their businesses during the three-year construction phase by saying, “I’m of the view that existing businesses will actually benefit from the construction. We should be positive.” So that’s all right then.

Toni Letts spoke at last night’s Croydon BID event: on behalf of the council or the Whitgift Foundation?

Some of the present occupiers of the Whitgift Centre might have the misfiring “Wastefield” development in Bradford in mind, where a vast hole in the town centre remained, untouched, for a decade until the Westfield developers sold the land.

Letts (whether speaking in her capacity as Labour’s cabinet member for economic development or as a board member of the dominant land-owner Whitgift Foundation was not made clear) said, “The council is going to make it easier for people who want to move their businesses to do so.”

But she did admit to being “fearful for some of the businesses”.

The air of caution, for his potential future tenants, for the council and the area as a whole, was underlined by Burton. “We are not a panacea,” he warned.

And when asked about the plans to manage the additional traffic likely to be attracted to the town centre by the new mall, the Hammersfield spokesmen were noticeably opaque. “We’ll begin discussions like that when we know which major retailers are coming into the centre, probably in 2016,” Cole said.

Robert Canning, the Waddon councillor who attended the event, said, “There was huge support for the £1 billion development.

“I am keen to see it completed at the earliest opportunity so that the benefits for Croydon can be realised as quickly as possible.”

 

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