Totally out of keeping with developments elsewhere in austerity Britain, a handful of new temples to retail indulgence moved on apace this week.
Seizing the headlines is One New Change, the City’s first seven-day shopping destination, which opened on Thursday in the shadow of St Paul’s Cathedral.
Belts may be being tightened elsewhere but, if you’re looking for a posh cake, some intimate personal grooming or a Jamie Oliver-grilled steak, you’ll be well satisfied.
But it’s not the only new show in town. A visit to Westfield Stratford City last week revealed just how that development has come along and how fast, ahead of its opening next September. The roof is on, the escalators are in (all 57 of them), and so is temporary (illustrative) signage. The new Underground station ticket hall is well advanced and is due for completion and delivery next year. The “Loft” food area and many of the shops are recognisable.
It may seem strange to be throwing up new malls at this stage of the economic cycle but development is, of course, a long-term game. And between recessions, for many, shopping has gone from being a necessary evil to becoming a fundamental British right.
Still, developers are having to think differently and cleverly to make schemes work. One New Change is a test in itself. Does the City want to shop at weekends? Plenty has been thrown at One New Change for its opening week, but does it have enough to offer once its novelty wears off?
Meanwhile, Westfield is doing smart things. As Estates Gazette reveals this week (p35), it is holding discussions with disgruntled retailers at Borough Market, in the hope that they will anchor a major new fresh food market at its £1.45bn east London scheme.
It is cleverly capitalising on discontent but it is also repeating a successful formula from its native Australia, where it operates 36 fresh-food markets.
It hopes that artisan cafés and stalls will bring in an additional tier of customer likely to be instinctively put off by the idea of shopping at Europe’s largest mall.
We shouldn’t confuse these developments with bellwethers, however. The property industry consensus, post-spending review, is that London will continue to thrive.
The capital has more in common with New York than Newcastle these days, to paraphrase speakers on one of the post-spending review panels I’ve chaired in recent days. And it’s a gap that is likely to widen.
Developers such as Heron’s Gerald Ronson and Berkeley Homes’ Tony Pidgley said as much at a Movers & Shakers breakfast; Derwent London’s John Burns was in agreement at a round table staged by EG and BNP Paribas Real Estate that same morning (p40).
It’s the same reason why a collective shrug greeted British Land’s announcement that it would push ahead with its Cheesegrater in the City. Like Land Securities’ Walkie Talkie, it was a question of when, not if. The only question asked has been why, given the City’s global reputation and the REITs’ strong balance sheets, did LandSec and BL not fund the developments themselves.
Perhaps a better test of whether we can develop and shop our way out of this is another LandSec project, its 750,000 sq ft shopping centre development at Trinity Leeds. Announced in July, it’s the first major retail development outside London to start since the downturn.
Retailers have committed to 50% of the space three years ahead of opening, LandSec commercial director Ronan Faherty told this week’s World Retail Congress. How quickly that dial moves will be a better test of the recovery and the spending review’s divisive impact than anything that happens in London.
