Our retailing correspondent MT WALETTE can find no good news for the nation’s high streets – which is very bad news for Croydon’s retail-led town centre ‘regeneration’
Last year was the worst on record for retailing in this country, with sales falling for the first time in 24 years as a dire performance on the high street dragged down the industry.
And all the while, Westfield and Hammerson had their plans for a £1.4billion retail supermall in the centre of Croydon under “review”. The scheme to rebuild around the Whitgift and Centrale shopping centres has been hanging around Croydon like a bad smell since 2011, and was due – finally – to begin demolition work last autumn. But that was cancelled and delayed, again, indefinitely.
There’s been no real, detailed update on the Hammersfield scheme since last February, apart from a very bogus-looking pre-election announcement arranged by Croydon Council apparently intended to convince the public that somehow everything with the project is tickety-boo, while attempts by Tony Newman, the Labour council leader, to keep the truth from the public, back-fired badly.
Hammerson and Westfield never did give any date for when they expect their review of the Croydon regeneration will be complete. Having seen the British Retail Consortium’s figures for 2019, published this week, they may never want to bother.
According to the BRC, total retail sales slipped by 0.1 per cent in 2019, the lowest since they began monitoring the sector in 1995.
The downturn was influenced by a 0.9 per cent fall in sales in the crucial final two months of the year, the pr-Christmas and Black Friday period when many retailers get most of their annual profits. That decline was partly driven by online sales rising by 2.6 per cent in November and December.
Yet even since the BRC crunched their numbers, there have been other announcements from individual retailing businesses this week which will curdle the shopping mall developers’ blood.
- GAME, the video game chain acquired last year by Mike Ashley, announced today that it is to shut 40 stores around the country. There is a branch in Croydon, though whether it is under threat of closure has not been revealed.
- Fashion retailer Jigsaw has demanded a 30 per cent rent reduction from its landlords and asked to delay rent payments in a bid to avoid becoming the latest casualty on the high street, according to a report in Property Week. Jigsaw has around 80 stores across the UK and concessions at department stores such as John Lewis and Harvey Nichols.
- Ted Baker’s bankers have hired advisors to carry out an independent review of fashion chain’s prospects. This comes after Ted Baker’s chief executive and chairman both resigned as the retailer issued a profit warning, saying it was in the “most challenging” period in its history.
- Debenhams is closing 19 department stores this month.
- House of Fraser is expected to close up to 20 of its remaining 52 stores this year.
- Marks and Spencer announced this week that sales were down 0.7 per cent in the third quarter of 2019. Shares in the company fell 8.1 per cent following the announcement.
- Tesco’s total like-for-like sales were 0.9 per cent lower than last year in the 19 weeks to January 4, 2020.
But perhaps the most significant piece of news from the sector, and especially applicable as far as Westfield’s and Hammerson’s businesses are concerned, is the announcement that JD Sports is to take on Top Shop’s store in Westfield Stratford, signing a 10-year lease for its second outlet in the mall.
A spokesman for Unibail Rodamco Westfield said that they are “thrilled”. Whether their colleagues reviewing their plans for Croydon share that emotion, only time will tell, though for Croydon town centre, time appears to be running out with every passing store closure.
Helen Dickinson, the chief executive of the BRC, said, “2019 was the worst year on record and the first year to show an overall decline in retail sales.
“Twice the UK faced the prospect of a no-deal Brexit, as well as political instability that concluded in a December general election, further weakening demand for the festive period.”
The BRC figures end a terrible year for the high street during which thousands of stores have closed and 140,000 shop staff lost their jobs.
Retailers including Top Shop, Dorothy Perkins and Miss Selfridge owner Arcadia, HMV, Laura Ashley, Karen Millen, Bathstore, LK Bennett and cake and cafe group Patisserie Valerie have closed a large number of outlets as part of a restructuring.
More than 12 per cent of stores stand empty – that’s 1 in 8 – according to analysts at Local Data Company, up from 11.5 per cent a year ago. “Retailers are centralising,” Ronald Nyakairu, LDC’s lead analyst, told the Grauniad. “Where they can have a city centre store that serves a whole metropolitan area, they will.”
Which is the sort of message that will surely feed into Westfield and Hammerson’s never-ending “review”.
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