Our vacated shopping centre correspondent, MT WALLETTE, on the latest multi-million-pound boardroom manoeuvres over Croydon’s developer-blighted North End
It has taken more than a decade, but Westfield’s hostile takeover of the Centrale shopping mall in Croydon town centre looks as if it is finally going to happen.
But the sale of Centrale by owners Hammerson to their erstwhile Croydon “partners”, now known as Unibail-Rodamco-Westfield, “would terminate decade-long plans” for the town centre’s redevelopment, according to one trade publication.
It is 10 years since Boris Johnson, when Mayor of London, together with his Tory mate, Gavin Barwell, inflicted the shotgun marriage of “Hammersfield” on Croydon, through a forced joint venture between Hammerson and Westfield, the Whitgift Centre landowners’ preferred developers.
Inevitably, like rats in a sack, the property speculators have ended up eating one another.
After two decades of decline in the retail sector and the double hammer blow of Brexit and covid, it is now a case of one struggling mall operator selling out to a slightly less struggling mall developer.
Fifteen years ago, Hammerson, then considered a successful operator of Birmingham’s Bull Ring and the Brent Cross centre in north London as well as Croydon’s Centrale, had a share price of 1600p. But Hammerson has been hit harder than most. This morning, the company was reckoned to be worth 26p per share.
Hammerson has to sell Centrale.
Property trade website CoStar News reported last night that Unibail-Rodamco-Westfield – the Paris-based company that gobbled up Westfield – “is in talks to take control of the redevelopment of the centre of Croydon in a move that would see it buy out long-term 50-50 joint venture partner Hammerson”.
CoStar reported: “The sale would terminate decade-long plans for the partners to combine their separate interests in Croydon’s two main shopping centres – Centrale in Hammerson’s case and the Whitgift Centre, where URW is development partner for the Whitgift Foundation – to build out what would be London’s last major retail destination.”
As well as the inordinate delays, the £1.4billion scheme which was originally supposed to be completed by 2017 has now had two planning applications approved by a pliant council (the chair of the planning committee had the undeclared interest of being a director of architects who had worked for Westfield), and a public inquiry, as well as a hugely expensive Compulsory Purchase Order.
But not a single brick has been laid, as tenant after tenant has quit Croydon’s town centre malls, exasperated with the Whitgift Centre’s leaking roof and constant uncertainty.
At the start of this year, Unibail-Rodamco-Westfield was hit with a £5million fine by the council for failing to action agreed elements of its scheme within a generous deadline. Croydon’s part-time Mayor, Jason Perry, has wagged his pudgy finger at Westfield, telling them he expects new plans before the end of 2023. But Westfield, and Perry, know the Mayor is powerless to force private developers into action.
Meanwhile, the Whitgift Foundation, having created the monster that is Hammersfield with its insistence on bringing in Westfield, has found the arrangement to be an albatross around its neck, with rental revenues in stubborn decline.
CoStar News reported that, “Hammerson and Unibail-Rodamco-Westfield declined to comment.” Which is a long way from a denial.
Elsewhere, Hammerson is reported to be selling up its stake in Croydon – which, remember, was at one stage a billion-pound development – for just “tens of millions of pounds”.
“If successfully concluded, the transaction will take Hammerson another step closer to meeting a £500million disposals target by the end of this year,” Sky News has reported.
“Offloading the Croydon Partnership stake to Unibail may go some way to placating Lighthouse, Hammerson’s biggest shareholder, which is demanding a resumption of dividend payments and reduce its exposure to development projects,” Sky’s City desk is reporting.
“Part of its 2021 strategy to turn around the business includes a disciplined disposals plan that would focus the group on a core portfolio of urban estates, reducing indebtedness and generating capital for redeployment into core assets.” Got that?
Even in 2019, before the covid shock to the retail sector, struggling Hammerson was selling off its assets, with £577million of property sales that year.
More recently, Hammerson has sold its Victoria Gate and Victoria Quarter shopping centres in Leeds for £120million and its half-share of Silverburn in Glasgow for £70million – none of which were included in its original disposals plan. But then, neither was Croydon’s Centrale.
As Inside Croydon reported four years ago on the business travails of Hammerson, the “recent conduct of their business does not appear to be that of a shopping mall operator who is about to stick hundreds of millions of pounds into building a new shopping mall”.
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Let’s not continually look back at the past and the disastrous incompetence shown by our politicians and property developers over the last decade and look forward to our Brexit benefits and taking back control.
The Whitgift Centre Site has great potential to be the largest Chinese Police Station outside of China and we have the expertise of local MP Chris Philp and his property developer investing Pluto Finance to assist them with this much need revival investment into central Croydon.
Fantastic – a new free enterprise zone named Croydon on Kowloon. Maybe a new Shangia- la offering staycations.
Decade long plans for town centre redevelopment will be terminated. What does this mean? Will the whole lot be knocked down and turned into flats?
There is no plan.
And if there was, there’d be no money to action it.
Tweedle Dum and Tweedle Dee, Heather Cheesborough and Nicola Townsend will approve plans for a shopping centre with upside buildings and no doors.
It will be interesting to see if the new owners of the whole lot decide to abandon the idea of building new shops, and go instead for one mega development of the biggest cluster of the tallest residential towerblocks this side of Shanghai.
With one shop– a Chinese Cop Shop.
It is about time that some Elephants in the room are put to rest.
Who thinks Croydon Council palnning departetn under Cheesbrough supported bty perfectly legal Townsend could manage any kind of development without disadvantaging croydon its residents and its finances?.
If you think it can – like this comment – if not do not like.
If you think that Croydon Council could not plan a piss up in a Brewery you might be right – but strangely enough we do have three Breweries in the Borough. So at least something!
I weep when I see what a dive Croydon Town Centre has become. I remember when you could easily spend a day at Croydon and not visit every shop on your list.
Croydon Council should hang their heads in shame.
Turning it into Manhattan is not the answer. Thankfully I have no need to visit Croydon any more.
When I visited Bromley last week I saw several empty shops. Bromley has been a better shopping centre than Croydon for some years now, and if The Glades has problems finding tenants, the Whitgift Centre doesn’t have a chance.
The days of shopping all day Saturday as a family, or midweek with friends, are long gone. A leisurely exploration of a department store is no longer available.
Groups of young people don’t wander around the clothes boutiques of Croydon these days, they have other reasons for being there. Retail premises are becoming redundant, and if the whole Whitgift Centre were demolished, a new mall half the size of the original might fulfill the needs of the thousands of people living in new flats on the site, but won’t attract enough customers from outside the area to make the shops profitable.
Do we have anyone available clever enough to look beyond the next election and plan the future of our town with some common sense? They would have to be experts with no previous connection to Croydon or to its corrupt and incompetent officials, of course.
Entirely reasonable, Diana. And probably requiring a “vision” going beyond the next two (local) elections to get any scheme off a drawing board and through to conclusion.
But will say this again, despite the risk of repetition: the redevelopment of the Whitgift Centre (and Centrale) is and always has been a PRIVATE business scheme, utilising PRIVATE property owned by the Whitgift Foundation and Hammerson.
Nothing will happen with the town centre unless or until these private interests come up with a plan which will deliver significant return on investment – and that has never been likely to be something which best serves the broader PUBLIC interest.
Whatever our part-time Mayor says…
Diana is right as is our editor.
With online shopping and delivery and very little quibble customer services – only places like John Lewis and Marks and perhaps next can begin to compete with online shopping.
But shopping is not the only reason people go to Town centres.
Croydon Centre is ripe to become a major retail/entertainment/public services/social and residential living area – the whole area including the Wellesley road and George street up to East Croydon station and to the Fairfield halls down to West Croydon and perhaps the London Road to Broad Green.
There are ways to regenerate Cryodon town centre but it does require both Central Government and Local Government to do their ground work.
There also needs to be a marked shift from the way Department stores operate with franchises and liabilities under the Consumer act..
Our Town Centre has got to move away from just brand chains and attract unique Boutique shops including second hand, Antique, specialists and actual Jewellers who make stuff on the premises or in the Borough. They all have to also have an online presence and that can be run at scale with a co-operative style structures to reduce individual costs creating both an online and store presence.
Seriously there are so many opportunities to make a town centre of the future meeting so many current and future needs, What there is not is a vision, effective market research, investment, regulations beneficial to all and trusted and any intelligent town planning nor any cohesive leadership.
New Mayor time?