Service charges at Westfield’s 1.75m sq ft Stratford City shopping mall in east London are to be set at £14 per sq ft.
The charge is £1 higher than that at Westfield London in White City, W12, where tenants have been in dispute with the Australian developer since the shopping centre opened last October.
Tenants at White City had been told – prior to the scheme opening – that the service charge would be £8 per sq ft.
They are understood to have refused to talk to Westfield about taking space at Stratford until agreement was reached on charges at both centres.
The £14 per sq ft level at Stratford is in line with charges at other flagship malls.
One agent said: “The problem at Westfield London was that the service charge was badly budgeted and then increased.
“This time, Westfield is trying to be more accurate to avoid the same problem.
“It is better to set the service charge high so that, when Stratford City opens, the reconciliation could be lower – the reverse of what happened at Westfield London. Retailers will be pushing for caps on the charge at Stratford, though.”
Westfield said that it was still finalising the level of the Stratford service charge.
Lettings activity is picking up at Stratford City, where four tenants are confirmed – anchor stores Marks & Spencer, John Lewis, Waitrose and cinema operator Vue.
Major fashion retailers – including Sir Philip Green’s Arcadia Group, Next and River Island – are understood to be in talks to take space at the scheme.
The mall is scheduled to open in 2011. CB Richard Ellis and DTZ are letting agents.
annabel.dixon@rbi.co.uk
