London’s West End was, once upon a time, the jewel in the crown of the capital’s retail offering. Its three key stretches of premium shopping space – Regent, Oxford and Bond Streets – were the places to be and to be seen, easily attracting both the most popular mainstream and high-end luxury brands.
Today, even though the area still lures top brands, impressive annual visitor numbers and spend – 200m and £7.5bn respectively this year – the area’s success is increasingly running on past reputation rather than the calibre of the current set-up and surroundings.
Steps towards invigorating and improving the area were made a decade ago when the New West End Company (NWEC) was set up to manage the upgrading of Oxford, Regent and Bond Streets.
This has begun to a degree, but the group’s managing director, Richard Dickinson, insists that the next five-year plan up until 2018 will see the most radical changes to date with increased investment, government backing and greater involvement from the property sector.
In an exclusive first interview following the release of the plan this week, Dickinson revealed his ambitions for a 25% increase in annual retail spend in the area from £7.5bn to £10bn over the next five years. He also explained how a strategy to see property owners double what retailers are investing in the area to £50m a year will help drive the rejuvenation of the West End retail district.
“We’ve rested on our laurels”
Dickinson admits that, no matter how popular the West End retail area has remained based on its long-standing reputation – it has a retail property value of £3.5bn made up of 120 international brands – it isn’t as good as it could, or needs, to be in a challenging environment and against the backdrop of the rise of online shopping. Add to this the emergence of major shopping centres including the two Westfield juggernauts to the east and west, along with higher standards globally and the need for change becomes even more pronounced.
“I think we have been resting on our laurels a bit,” he says sitting in the NWEC Regent Street HQ. “If you are letting a piece of central London prime property, your investment will always be returned at a good rate. But we have to be mindful that we are keeping up.
“Competition overseas, in Shanghai for example, means that people will start to look at our spaces and say ‘yours aren’t as good as theirs. Why is that?’ So we have to invest.”
A £25m injection of funds from West End retailers over the next five years was announced this week. In addition, NWEC will look to raise a further £15m from local property owners.
The funds will go towards area upgrades, improving the streets’ general upkeep and cleanliness, cracking down on crime and illegal trading, traffic-free events – which could even stretch to the introduction of entirely traffic-free weekends – and a new mobile app and digital-based marketing programme.
In terms of redevelopment, Dickinson says the focus will be on Bond Street, Tottenham Court Road and the east end of Oxford street over this five-year period. There will also be a more general focus on improving space and creating more areas for shoppers to use outside of the stores themselves.
“Our plan will see significant investment, around £8m in Bond Street as it is looking tired compared to other luxury retail destinations around the world. We will look at new carriageways, new pavements, new lighting and new ways of better using the space.
“The future of the east end of Oxford street looks good according to a recent study we did – especially with Crossrail being right there. This part of the West End will continue to be branded, flagship retail. Tottenham Court Road will shift from electricals -which really isn’t working – to homeware. East Oxford Street is presently 220 Zone A. It will be 500 Zone A by 2020 and you can quote me on that.”
One of the more radical plans is to build on the success of traffic-free events over the past five years and turn the main streets traffic free every weekend.
“We are seriously considering this and we’re working with experts from New York to develop a plan to introduce it on Regent Street. We just don’t necessarily need traffic at the weekends. In fact, we simply can’t continue with all the cars and buses we have in the West End if we want to become a successful, leading shopping destination.”
Considering that traffic-free events over the last five-year NWEC planning period saw a £300m return and a 10m increase in visitors, Dickinson may be on to something. And he insists that the reduction in traffic won’t make it harder to reach the destination – especially after Crossrail opens in 2017.”
The 2018 plan also includes a digital marketing strategy complete with a new West End app that will guide shoppers through the district, offering maps, click-and-collect services and a breakdown of the different areas.
“We have just done an app highlighting the London Luxury Quarter,” says Dickinson. “It shows all the stores around Bond Street, Mount Street, Burlington Arcade. People don’t necessarily know about what we have to offer around that area. The West End app will offer an easy-to-use iPhone enabled map, details of all of our brands, a concierge service. Customers will even be able to hire their private jet from it…”
It comes as no surprise to hear then, that it will be available in Chinese and Arabic – 90% of all transactions on Bond Street last year were from international sovereign wealth.
Calling on property
The property sector will have an increasingly key role in this delivery. Both in terms of ideas input and investment. Dickinson explains that property owners will be integral in increasing the speed and volume of upgrading works, as much as doubling retailers’ investment in the area to £50m each year, as government looks set to formalise NWEC’s position as the UK’s first Business Improvement District (BID). This is a system where local businesses pay additional fees towards the upkeep and improvement of the area.
“The department of Communities and Local Government (dCLG) is taking legislation forward at the moment to involve property owners more fully in the upgrading of the area.
“As far as we know, once this is done, the property ballot – which has been signed up to in principle by all of our major property owners including Grosvenor Estates, Derwent, Land Securities and Great Portland Estates – will then go out to 65 property members in the West End in 2013 so that next year we can become one of the first BIDs in the UK formally. This should bring in an extra £25m – effectively doubling what we’re getting from retailers at the moment. This will give us huge potential to do some of the work, the Bond Street upgrade for example – in a quicker time frame.”
Bucking the trend
Though the outlook for retail remains challenging, Dickinson is upbeat. His faith in the area’s future is unwavering – in part due to London’s strong position on the world stage: “Wealth protection in London is very stable, globally we’re an attractive city to invest in,” he says. “There is a Middle Eastern banking system here and we’re used to looking after Middle Eastern investors and shoppers. We are looking to build on the success from the Olympics.
“We have already seen this event triggering investment. We have had about 50 store openings in the past three months and about £250m worth of investment.” We are heading for a good place. The high street may generally be suffering, but we’re bucking the trend.”
