The council is readying itself for a ‘hard Crexit’ over a £1.4bn town centre redevelopment, according to industry watchers. By WALTER CRONXITE
There could be a further delay of two more years, to 2025, before the new Westfield shopping mall in central Croydon opens, according to the analysis offered by a widely read property journalist last week.
The council has even had to draw up contingency plans in case the whole deal collapses – what Peter Bill, writing in Property Week, describes as “a hard Crexit”.
Bill bases his judgement on what he calls “this blighted project” on a brief encounter with Croydon Council chief executive Jo Negrini a couple of months ago, when he says he asked her about the Town Hall plans in case the wheels do fall off the Croydon Partnership of Hammerson and Westfield and their £1.4billion scheme for 1,000 flats and a shopping centre.
“We’re not stupid,” Negrini is supposed to have said, risking having council-watchers to provide a litany of examples to prove her claim wrong.
“We are watching carefully what is going on,” Negrini is supposed to have told Bill at one of the many cosy little get-togethers she likes to attend to burnish her reputation with developers.
“The look in the Aussie town planner’s eyes told the tale,” Bill observed in his Property Week column last week.
The column was written following the significant shifts in ownership, and in corporate policy, at the two members of the Croydon Partnership, Hammerson and Westfield.
In July, Hammerson announced it was shelving development plans for their other large London mall, at Brent Cross. In part, at least, this is because of growing uncertainties over Brexit.
Since then, a takeover for the troubled House of Fraser, which has a key department store in Hammerson-owned Centrale, has collapsed. The Financial Times reported that Hammerson may well be seeking someone to buy-out its Croydon interests, an analysis with which Bill agrees.
Also last month, we reported how John Burton, the Australian who had been in charge of Westfield’s European operation that had delivered supermalls at Stratford and Shepherd’s Bush before the stalled Croydon scheme, was leaving the company.
Now, his opposite number at Hammerson, Peter Cole, is leaving his job, too.
Bill notes that Cole “fell on his sword… as part of Hammerson’s defensive plan to shrink the business in order to increase its share price”.
The Hammersfield project and its cheerleaders have promised to turn Croydon into some kind of suburban land of milk and honey since 2012. But bit by bit, it looks to be falling apart. There’s no prospect of the development blight created around the Whitgift Centre and High Street being lifted any time soon, with demolition work not due to start for 12 months at the earliest.
As Bill highlights, Hammerson’s Cole has even admitted that detailed designs haven’t even yet been started for the swathe of town centre property.
Like many people in Croydon, Bill is intrigued to find out what plans the council, and Negrini, might have if it really does all go tits up.
With the original partners having already spent the thick end of £300million on the scheme over the past six years, Bill believes that the most likely scenario is that Unibail, Westfield’s new French owners, will take it on.
It is, however, entirely typical of Negrini and her style of local administration that, while she has shared with private developers at least an indication that the council has a contingency plan, similar information has been withheld from the people who pay her £200,000 annual salary, the Council Tax-payers of Croydon.
Bill writes: “Like Mrs May and her contingency plans for hard Brexit, Negrini’s team have contingency plans for Crexit: the departure of one or both the members of the Croydon Partnership, and/or a further substantial delay. Unlikely, yes.
“More likely is Unibail taking effective control and completing the development using the talented Westfield team under Peter Miller, who ran Europe for Westfield and is now chief operating officer of the UK.
“But given the history of this blighted project anything is possible. Even an opening in 2025.”
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