How Westfield won us over - Business Analysis & Features - Business - The Independent

How Westfield won us over

The West London shopping mall had a tough start – but life is better one year on, reports James Thompson

When the Australian property giant, the Westfield Group, opened its shining, £1.7bn retail cathedral in Shepherd's Bush, West London, on 30 October 2008, its timing could not have been worse. Westfield London, spanning 43 acres and offering more than 280 shops, opened its doors in the teeth of the worst recession since the Second World War and just before a series of retailers, including Woolworths, started falling over like a pack of cards late last year.

One year later and the mood music from a number of the centre's retailers appears more positive. While the economy has not emerged from recession, Westfield appears to have done so, reflecting that most of the capital andSouth-East England is showing the rest of the country a clean pair of heels.

But others argue that the performance of Westfield London's retailers is "mixed", that it has failed to live up to expectations and that some chains, including Clinton Cards and the sportswear outlet Puma, are already looking to scale back their presence.

Nevertheless, Michael Gutman, the managing director of Westfield Europe, yesterday struck an upbeat tone about the past 12 months. He said the centre was almost fully let and was on track to attract 23 million visitors inside the first year – 15 per cent more than its target of 20 million.

He added: "It has been in line with expectations. It has been a very solid start in a very difficult environment. We really saw a lot of distress, administrations and bankruptcies at the end of 2008 and in early 2009 but the situation has stabilised." After a slow start, it is thought that a number of the centre's more successful shops have seen a marked pick-up in trade over the past five months.

Michael Sharp, deputy chief executive of Debenhams department stores, said: "We have been very pleased with the performance of the Westfield store and it is bang in line with our expectations. We are getting good footfall into the store. We are definitely seeing quite a few tourists shop in the store."

He added that Westfield had not had any adverse affect on trading at its department store in Oxford Street.

Sir Philip Green, the billionaire tycoon behind the Bhs and Arcadia retail empire, said: "We are pretty happy with Westfield. Topshop and Topman have done very well."

Like many retailers, Mr Gutman admitted he was surprised that tourists accounted for more than 30 per cent of visitors to Westfield London, including a large number of Chinese. "We have been a beneficiary of the whole tourism boom in London, partly from the cheap pound and 'staycations'," he said. The numbers of people using public transport to get there is also ahead of expectations. Guy Grainger, head of UK retail at the property company Jones Lang LaSalle, said: "[The figures are] impressive and unprecedented with any other shopping centre."

Mr Gutman said more than 70 per cent of visitors came to Westfield by bus, Tube or train, justifying the company's investment in nearby stations. However, it is fair to say that Westfield offers only a partial picture of what is happening in the rest of British retailing.

Until the last couple of months, trade at London's shops was well ahead of those in the rest of the UK, buoyed by the influx of tourists, confidence returning to the financial sector and the housing market stirring in the capital before it did in the provinces.

In addition, Mr Grainger said there was "a trend towards shopping in a modern retailing environment with a strong tenant mix, as opposed to some traditional second-tier towns".

There is scepticism that trading at Westfield is quite as rosy as the picture its owner paints. Mr Grainger said the feedback was that the performance of shops at the complex was "mixed", in line with market conditions. But he added: "It is fair to say that the mainstream fashion retailers are pleased with the performance at Westfield London and, despite speculation, I hear the luxury retailers are trading well."

Martin Crossley, a retail partner at the property specialist King Sturge, said: "It is not doing that well. There are a number of units on the market already, with retailers trying to get out. Trading has not been that fantastic and it has not had the impact on the West End and surrounding boroughs that had been expected. Some of the stronger brands that are in there are doing well, but they are doing well everywhere in the country."

Furthermore, industry sources said there was still "discontent" over an increase in the service charges levied on tenants after the mall opened. Mr Crossley said: "The huge row about charges did not do them any favours in their relationships with tenants."

Westfield, however, insisted that it resolved the dispute in June by reducing the service charge by 7 per cent from £13.94 per square foot to £12.98, and giving retailers credits.

Retailers and restaurants are also disappointed that Westfield's cinema, a key driver of footfall, will not open until February after a long delay. But despite these shortcomings, the outlook for the centre as it approaches its first anniversary seems far brighter than it was at this time last year.

Let the Games begin: Centre owner remains bullish about East London site

Just like Great Britain's athletes, the Westfield Group faces a race against the clock to be ready for the London Olympics in 2012. The Australian group plans to open the Games' flagship shopping centre, which spectators will walk through to get to the Olympic stadium in Stratford, east London, in 2011. But so far only three retailers – John Lewis, Waitrose and Marks & Spencer – have signed up to take over one of the 300 units.

Speculation is also mounting that the opening date of June 2011 has already been pushed back to the autumn of that year, but Michael Gutman, managing director of Westfield UK and Europe, said: "We have not set any opening date."

Furthermore, he said Westfield was in advanced talks with a number of "major store users" which typically needed between 20,000 and 50,000 sq ft of floor space. Mr Gutman was also bullish about prospects for Stratford because it is served by several Tube lines, the Docklands Light Railway and a high-speed rail link. "Stratford will be like Westfield London on steroids," he said.

News
Residents of James Turner Street such as White Dee will have a chance to share their experiences of benefits on a Channel 4 spin-off show
peopleBenefits Street star says mixed-race children were subjected to trolling
Sport
Angel Di Maria
Football
News
Piers Morgan tells Scots they might not have to suffer living on the same island as him if they vote ‘No’ to Scottish Independence
news
Life and Style
techIndian model comes with cricket scores baked in
PROMOTED VIDEO
News
i100Exclusive interview with the British analyst who helped expose Bashar al-Assad's use of Sarin gas
Arts and Entertainment
Keira Knightley and Benedict Cumberbatch star in the Alan Turing biopic The Imitation Game
film
Arts and Entertainment
Rob James-Collier, who plays under-butler Thomas Barrow, admitted to suffering sleepless nights over the Series 5 script
tv'Thomas comes right up to the abyss', says the actor
News
newsIn short, yes
Extras
indybest
News
Denny Miller in 1959 remake of Tarzan, the Ape Man
people
News
ebooksAn unforgettable anthology of contemporary reportage
Sport
BoxingVideo: The incident happened in the very same ring as Tyson-Holyfield II 17 years ago
Life and Style
Jourdan Dunn gave TopShop’s Unique show some added glamour at London Fashion Week
fashion week
News
Groundskeeper Willie has backed Scottish independence in a new video
people
Arts and Entertainment
The Doctor poses the question of whether we are every truly alone in 'Listen'
tvReview: Possibly Steven Moffat's most terrifying episode to date
News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SQL Developer - Watford/NW London - £280 - £320 p/d - 6 months

£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Senior BA - Insurance **URGENT**

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Training Coordinator / Resource Planner - City, London

£35000 - £38000 per annum + Benefits: Ashdown Group: Training Coordinator / Pl...

Data Governance Manager (Solvency II) – Contract – Up to £450 daily rate, 6 month (may go Permanent)

£400 - £450 Per Day: Clearwater People Solutions Ltd: We are currently looking...

Day In a Page

These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week
The fall of Rome? Cash-strapped Italy accused of selling its soul to the highest bidder

The fall of Rome?

Italy's fears that corporate-sponsored restoration projects will lead to the Disneyfication of its cultural heritage
Glasgow girl made good

Glasgow girl made good

Kelly Macdonald was a waitress when she made Trainspotting. Now she’s taking Manhattan
Sequins ahoy as Strictly Come Dancing takes to the floor once more

Sequins ahoy as Strictly takes to the floor once more

Judy Murray, Frankie Bridge and co paired with dance partners
Wearable trainers and other sporty looks

Wearable trainers and other sporty looks

Alexander Wang pumps it up at New York Fashion Week
The landscape of my imagination

The landscape of my imagination

Author Kate Mosse on the place that taught her to tell stories