The prospects of Westfield ever making good on their promise to redevelop the town centre appear to be receding by the week, while Croydon’s Labour-run council cravenly gives in to the developers by withholding vital information about the long-delayed project.
Westfield, and their partners, Hammerson, announced in February that their £1.4billion scheme to redevelop the ageing Whitgift Centre shopping mall was to be put under “review”, with planned demolition work, due to commence in September, delayed indefinitely.
Six months on, and neither of the two multi-billion international developers have uttered a word publicly about how long their “review” might take, or offered a new date for work to begin. Westfield and Hammerson first announced their plans in 2012, when they said that their wonderful new supermall would be open for business by 2017.
A significant factor in the developers’ pause for thought has been the accelerating decline of high street retailing, making businesses based on charging premium rents to large stores look decreasingly attractive.
Hammerson, in particular, has been struggling to make their business work, as they have been hard hit by large stores, including the likes of House of Fraser and Debenhams – both found in their Centrale mall in Croydon – seeking rent reductions or to pay no rent at all.
And the latest economic reports from the world’s two largest financial information agencies, Reuters and Bloomberg, in the past fortnight suggest that things are not going to get any better any time soon.
According to figures from the CBI – the Confederation of British Industry – in the year to June, retail sales in this country fell at their fastest pace since the financial crisis 10 years ago. Retailers blamed “relatively poor weather”.
Bloomberg reported, “The volume of goods sold slumped by the most since March 2009, with almost 1-in-6 stores saying they sold less than the same time a year ago. Motor traders reported the fastest sales shrinkage in 7½ years, although non-store sales, which include online purchases, bucked the trend to remain broadly flat.”
On top of Brexit “uncertainties”, it is the online sales which are hitting the Croydon plans for Hammersfield, with Bloomberg noting that the findings “underscore the woes afflicting the British high street”.
That report was based on figures for the year to June. Today, Reuters has reported on how the high street fared last month, and it really is no better.
“Britain’s high street retailers had a ‘washout’ June…”, see, they’re blaming the weather again, “… as shoppers worried about the Brexit crisis and did not respond to early summer sales discounts,” the news agency reported, citing the monthly High Street Sales Tracker conducted by BDO.
“Sales fell by 0.8 per cent last month compared with June last year, the 16th time in the last 17 months that in-store sales have shown no growth,” Reuters reported, starkly.
“June was another washout month for the high street. We saw retailers discount early on in June, adding further pressure to tight margins, yet they still weren’t able to salvage the month,” said Sophie Michael, the head of retail at BDO.
Michel then added a comment as if she had Croydon’s stalled Hammersfield development in mind. “Retailers are stuck between a rock and a hard place. They want to invest and adapt, but they don’t have the funds or confidence to do so.”
The problem for Croydon is that Westfield and Hammerson’s delays only make a bad situation worse for the town centre’s remaining businesses.
Many of these have been left in limbo over council-led Compulsory Purchase Orders and they now struggle to attract new custom to an area which has had barely any investment in a decade in anticipation that the Tory-backed Hammersfield scheme might start any time soon.
Blairite council leader Tony Newman recently boasted at a scrutiny committee meeting, when asked about the deteriorating situation in the town centre, that he “has a Plan B, and a Plan C”. He refused, though, to elaborate on what these might be.
Newman has not allayed the concerns of his councillor colleagues about the impact the commercial developers’ delays are having on the Labour administration. “If Tony has got alternative plans, then he has not bothered sharing them with the rest of us in the Labour group,” the councillor told Inside Croydon.
“He doesn’t need to worry about B or C… the only letter Tony needs to consider as far as Westfield is concerned is ‘F’: for failure and no F-ing idea.”
Newman and the council have become increasingly secretive about the progress, or lack of it, with the Westfield scheme.
They have now tried to block a request, made under the Freedom of Information Act, for sight of a letter sent by Westfield to Newman in March, which the council leader claimed, he was promised bright sunny uplands for the whole of Croydon, and which reassured him that the developers were sincere about going ahead with the scheme.
The council claims that the letter is “commercially confidential”, and that Unibail-Rodamco-Westfield, to give the company its latest title, has been in touch with the Town Hall to remind them of this and to withhold their letter, sent to the borough’s most senior public representative.
Not that commercial confidentiality bothered Newman much when, like an over-excited schoolboy, he smeared parts of the letter across social media four months ago, claiming that everything was going to be just fine and dandy. According to Croydon Council, this was not a breach of commercial confidentiality.
“Trouble with this is that if that letter really did have real reassurances in it, then why not publish it all?” a Katharine Street source said today. “A two-page missive from developers is hardly likely to carry any essential business details in it. So it is all beginning to look as if Newman and Westfield really do have something to hide.”
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