WALTER CRONXITE checks the City pages and discovers some worrying trends for Croydon business and property heading into 2016
Three pieces of business news – from retail, housing and commercial property – in Croydon this week strongly suggest that for all the tens of thousands of pounds squandered by our council, by Westfield and other developers, on image consultants and other PR bullshit campaigns about the borough’s “prospects”, one thing remains true: you can’t buck the market.
For Blue Inc, it seems that there just wasn’t enough of a market, as the fashion retailer announced yesterday that it is to go into administration, with the closure of up to 65 shops and the loss of around 500 jobs.
This could soon impact the already declining high street in Croydon’s town centre, since Blue Inc has a store in Centrale, a presence in Debenhams, and an Officers Club store, its other brand, in the Whitgift Centre. The law of averages alone suggests that at least one of them may be under threat. Expect the latest “Closing Down Sale” signs to go up in the Whitgift Centre soon.
Significantly, Steven Cohen, Blue Inc’s chief exec, flagged up the growth of online retailing as one of the reasons for the store closures. “Given the strength of online and the changing environment on the high street we decided now was the right time to evaluate the store portfolio,” Cohen told Retail Week.
That’s hardly jolly news for all those speculators who are staking their penthouse apartments on the £1 billion Hammersfield supermall that is supposed to be coming to Croydon, some time.
Many of Blue Inc’s customers won’t have many places in Croydon to go to step out in their new clothes after tomorrow’s last night of Tiger Tiger, where it is rumoured that Winston McKenzie will be holding a wake for his own ludicrous political career.
Tiger’s closure, due to a fall-off in the number of customers gullible enough to spend £7 or more for a drink with an umbrella in it, innit, has also revealed a cooling down by other developers who have recently invested in Croydon.
Eight months ago, Hermes Fund Managers invested £65 million, citing Croydon’s “regeneration potential”, as they bought the NLA Tower and the Grants building, which houses the Tiger night club. At that time, the local rag reported that the multi-billion-pound property developers would be announcing their redevelopment plans – presumably for Grants – “within months”.
Since when, silence.
This week, a spokeswoman for Hermes denied that anyone at the company, and certainly not the director of retail who was quoted by the Sadvertiser, had ever said such a thing and that there were no redevelopment plans. None at all. Oh no. Which makes you wonder why Hermes would bother laying out millions amid such bullish commentary so recently.
Asked whether this apparent U-turn since last spring was in any way connected to the slowing pace of the Westfield and Hammerson development, the PR said she would call us back. We’re still waiting.
And anyone thinking of getting themselves mortgaged up to their eyeballs for the rest of their lifetime in order to snap up one of the spatially challenged “luxury apartments” in the over-high towers being built in the town centre had better beware, too, since even property agents are warning of “over-supply” in the area.
The arrival of Foxtons in any neighbourhood is one of the bellwethers of impending gentrification, and the estate agents’ setting up shop at the top of Crown Hill was greeted with street parties, fireworks and bunting by Croydon’s Glee Club. At least metaphorically.
Their joy may be short-lived.
City AM today has one of those property sales ad features, which looks suspiciously like it has been bought and paid-for. But it includes an unusually downbeat sentiment from Camilla Bell, a partner at Black Brick, a property buying agency. “There has been a lot of property ‘hype’ about Croydon over the last few months,” she said. No shit, Ms Sherlock.
“Foxtons has recently opened up a Croydon office and there has been a lot of interest in the area from investors …” – note that use of “investors”, rather than “home-buyers”, suggesting that much of this is for the buy-to-let market – “thanks to its proximity to London, more attractive pricing and the opening of Westfield.
“However, investors need to tread carefully and seek advice from a buying agent before buying in Croydon as we are starting to hear rumblings that there may be a risk of oversupply in the area, particularly from the new build sector.”
Oh, right. And this just at the time when the brains trust at Croydon Council, who were taken for a ride over property deals after the last global economic downturn, but who now think they’re going to raise £20 million from building and selling top-end flats at College Green to pay for the Fairfield Halls redevelopment.
Good luck with that one, then, Nathan.
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