Charles Wright: Can the West End recover? And how?

Charles Wright: Can the West End recover? And how?

Some of the unsavoury reality behind the garish frontages of the crop of “US-style” candy stores on Oxford Street was uncovered last week in a Westminster Council trading standards crackdown.

More than £100,000-worth of illegal and counterfeit goods were seized, including vapes with excessive nicotine levels and 2,246 fake Wonka bars. That counterfeit chocolate can be lethal. The Food Standards Agency warned last month that some contained allergens not listed on their labels. 

There are other issues too. The council is investigating the alleged non-payment of almost £8 million in business rates by stores, which pose a “threat to the status and value of what is supposed to be the nation’s premier shopping street,” according to Westminster’s new – and first ever – Labour leader Adam Hug. 

The council is pointing the finger at Oxford Street’s landlords, but they are hitting back. They don’t want these stores either, they say, but their hands are often tied by long-term leases to intermediaries, limiting their influence over who gets to sub-let vacant units. 

Hug is continuing his Tory predecessors’ scheme of encouraging landlords to go for short-term “pop-ups” instead when retail units become empty. It’s a welcome gesture. However, it is increasingly clear that the “dodgy candy shops” are just a symptom of a much wider set of problems affecting the West End – problems which demand wider answers.

Footfall is creeping up, but for Oxford Street in April it was still 52 per cent lower than pre-pandemic, according to the Retail Gazette. The business improvement district grouping New West End Company (NWEC) says 2020/21 footfall overall in its area was at 60 per cent of 2019 levels.

The Crown Estate, which owns Regent Street, is forecasting more shop vacancies over the coming year, while one survey last year showed almost one in five shops in Oxford Street standing empty.

There’s a grim catalogue of factors driving the malaise – Covid, of course, the continuing shift to online shopping, “hybrid” working increasingly looking like the new normal, and the impact of high business rate levies. The last of these is blamed by some for the candy store glut, with landlords seeking to avoid liabilities on empty units, as well as deterring otherwise viable potential tenants.

Turnover remains depressed at some £6 billion in 2020/21 compared to £10 billion in 2019. According to NWEC it will take until 2025 before the West End gets back to those pre-pandemic levels, with the extent of the return of international visitors, vital for reaching that target, still uncertain.

Property owners and their lobby groups like to present an optimistic front: “We’ve got a lot of confidence in the long-term future of Regent Street,” Crown Estate chief finance officer Robert Allen said last week. But calls for urgent action are getting louder

NWEC chair Peter Rogers hit out at “six years of talking” about improving Oxford Street when presenting the grouping’s annual review this month. “It’s now time to deliver,” he said, adding that a well-funded sustainable transport system was an “economic necessity” for the West End. And it was a year ago this month that Crown Estate chief executive Dan Labbad warned that the “serious congestion of Oxford Circus, of people and traffic, is unsustainable and demands action”. 

But a range of plans, from Sadiq Khan’s 2018 full pedestrianisation scheme to Westminster’s recent £10 million “rival to Times Square” piazza proposals, have consistently come to nothing. The much-ridiculed £6 million Marble Arch Mound was an all too public symbol of failure and contributed to Labour winning control of the council last month.

With Oxford Street and its surroundings in the eye of an “existential” storm, the solution has to be about much more than getting retail back on its feet, according to Martyn Evans of developers U+I. Last week he weighed in with a call for “radical thinking”, provocatively declaring that asking landlords and their retailer tenants to “debate whether Oxford Street has a long-term future as a predominantly retail destination feels to me like asking turkeys to vote for Christmas”. 

Westminster Council, City Hall and the government should be working together, Evans said: “The same verve and ambition of solutions that were applied, for instance, by the Treasury to the impact that lockdown had on our economy should be applied here.”

Is a wholesale new approach on the agenda? Ahead of their historic election win, Westminster Labour were already accepting that the West End was changing. The party’s manifesto pledged to help the area rebuild post-pandemic by encouraging a wider mix of uses, including more affordable housing, leisure, culture and “experiential” retail. 

It’s an approach that is mindful of residents’ regularly-expressed concerns about change on a large scale. Rather than pedestrianisation, for example, the party talks about temporary events “such as a weekend street market along Oxford Street”.

But many powerful interests are at play, including major landowners such as the Crown and Grosvenor estates, and the new link-up just announced between Capco and Shaftesbury to create a £5 billion property portfolio stretching from Covent Garden to Carnaby Street.

The council, as Labour’s manifesto spelt out, will be looking to these property-owning giants to “pay their fair share” towards getting the “Oxford Street District” improvement plans back on track. But will the leverage of the big retail interests keep them to the fore, even as the world around them moves on? 

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Categories: Analysis

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