Boxpark Croydon made a loss of nearly £500,000 last year, according to accounts filed to Companies House.
The operation, renting space to independent outlets selling street food and staging music and other events in a collection of disused shipping containers next to East Croydon Station, opened in October 2016 thanks to a chunky loan from Croydon Council of £3million, plus another £180,000 grant of public cash towards its launch party.
Last week, Tony Newman, the leader of Croydon Council, during a council cabinet meeting presentation, referred to Boxpark as a “successful investment” by the council.
The company’s filed accounts cover the period to the end of April last year – and therefore reflect the first six months of being open for business in Croydon, with all the attendant set-up costs. The accounts were lodged by the private business’s founder, Roger Wade.
Wade, as company director, opted not to include the company’s profit and loss account.
The balance sheet shows that the business’s net equity deteriorated from -£75,000 to -£523,000 to April last year. Click here to download a pdf of the Boxpark accounts.
The venue has suffered a haemorrhage of food outlets, from the 40-plus at the time of the grand (and council-subsidised) opening, to 34 by Christmas 2017. According to Boxpark’s own website, the past month has seen another six food outlets join the exodus, as they now list 28.
The company is now keen to extend the trading hours for its own BoxBar outlet, with an application to the council’s licensing committee to stay open into the early hours at weekends.
A planned meeting of the council’s licensing committee last month was hastily cancelled. It had been thought that the meeting was to consider a licence extension request for BoxBar. The company submitted a formal application for late night boozing on January 15. Click here to read the licence application.
This licence extension for one business operating within Boxpark serves to further highlight the imbalance in competition between the landlord and Boozepark’s tenants.
Boxpark uses its tenancy agreements to curtail the times when its tenant outlets can sell alcohol. And the outlets, each struggling to make a go of their business in competition with their neighbours, also suffer other restrictions.
On New Year’s Eve, which is usually one of the busiest and most lucrative nights of the entire year for clubs and bars, the popular Cronx Bar at Boxpark could be seen to be dark, and closed.
They were unable to trade late into the evening because its landlords were staging a rave inside (tickets: £33 and upwards). With the Cronx Bar being located on the exterior of Boxpark, their customers would not have had easy (if any) access to the ticket-only area inside, which is where the venue’s toilets and other facilities are to be found.
According to one Boxpark trader, they are paying £2,000 per month unit rents and £750 monthly service charges, to include the use of such facilities for their customers.
Another Croydon Boozepark outlet has told Inside Croydon that, under their tenancy agreement, they have been banned from even advertising on their own publicity that they even sell wine or beer – the suggestion being that the landlords want to monopolise the lion’s share of booze sales in Boxpark.
It is understood that Boxpark made a full first-year installment on its loan from Croydon Council last year.
But the licence extension presents another ethical conundrum for Croydon Council.
“If Boxpark are losing about £500,000 per year, it is no surprise that they are seeking extended hours for booze sales, as that would presumably help with net income,” a Katharine Street source said.
“But how Croydon Council’s licensing committee can be independent in determining that matter, given their £3million financial exposure with the business, is highly questionable.
“If the current situation continues, debt will increase until they run out of cash or people willing to lend them money. Croydon Council have a charge on the company but the building would not be of much value if it cannot be operated at a profit, as seems the case. Furthermore as the lease on the land gets shorter, any charge becomes of less value to the point where there remains just a liability for removing the building.”
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