Morning:
14°c
There was blood on the stucco this week as the quarterly rent bills thudded in, giving coronaries to the owners of many little independent boutiques, delis, and shops in my 'hood, Notting Hill. A shop seems to close every day in Kensington High Street but things are getting even more sanguinary in Westbourne Grove.
In the stretch of shops between Ledbury Road and Chepstow Road, up to a quarter of retail spaces are all shuttered and boarded, with sad signs in the windows thanking their customers (that said, a Burberry, a Bonpoint and a Ralph Lauren are still trading in W11's Gucci Gulch).
One pale owner of a local bijou deli explained. Shopkeepers have to pay rent upfront for every quarter, rather than monthly; there is no mechanism to negotiate rents down and no appetite on the part of local government to tamp down the Rachmanesque demands of landlords.
"We spent 10 months negotiating our lease via our landlord's agent, a man determined to drive as many businesses to the wall as possible," he said. "And it still went up from £75k last year to £87k in 2009."
I know that the job losses when plasticky high street chains go under are much higher, but I can't help feeling this is wrong, and avoidable. Every time an independent little shop selling spelt hot cross buns or superfood salad goes belly-up is a dagger to my heart.
* So now to the most vexed question of the Aga. No, not whether they're eco-friendly or not. Whether it's time to switch off, or leave on, now daffodils are here. As I suspect that last week we had both our spring and our summer together, I am keeping my home fires burning.
* What's all this I read about my favourite arts programme - Newsnight Review - moving to Glasgow? Eh! Why? All the shows, exhibitions, plays, installations, happenings, blah blah, take place in the capital. And all the guests who opine in their prodigiously pretentious way live within the M25, from Tony Parsons to Julie Myerson by way of Tom Paulin. There are dark mutterings that the decision has been taken to indulge one of the presenters, the incomparable Kirsty Wark, whose TV company and family are based in Glasgow. I can't believe that. The corporation is always fighting accusations of London-centrism. So, rather than accept that this just is the capital of culture, it prefers to shell out for a weekly caravanserai of the chattering classes to travel to Glasgow and back to talk about events taking place in London. Trebles all round!
Reader views (7)
i have rented small retail lock ups for the last 33 years and started paying 12k for my current unit 19 years ago.I am now paying 7650 with just 12 months to run on my 20 year lease.
downward reviews are more than possible,never be intimidated by landlord agents who generally do not have a clue and are very unprofessional.They usually get the upper hand because they have more of a clue than the eager first timer over anxious to start his new venture convinced he will make a success of this new business.Once you negotiate an unrealistic rent you not only jeopordise your next rent review settlement but also all the reviews due to your neighbouring retailers.
- Robert Lewis, harrow middlesex u.k
The "upwards-only" rent clause should be unenforceable in courts. The very reason for the existence of the courts and mediation services for rent reviews is that it may not be realistic or practical for a shopkeeper to move without ceasing to trade completely.
Those claiming it is possible to negotiate rents down are mistaken, and have obviously never run a shop. Landlords in the most vulnerable locations have one eye on residential conversion, which will improve the value of such properties. They often put rents artificially high in order to 'prove' to local councils that the shop is unviable, and then simply convert. When they convert, neighbouring shops suffer from the blight on the locality as the shop front is brutalised and forecourt is reclaimed for parking.
I know many businesses who have appealed unsuccessfully against high rateable values to the VOA on the basis that they are surrounded by newly empty or recently converted shops. This evidence of local commercial values was rejected, so Government is colluding with greedy landlords.
Those who believe it is simply for a shop manager to efficiently convert all customer goodwill at an existing location and upsticks to another are living in cloud cuckoo land, or have an agenda of sorts.
In any case, many shopkeepers ARE simply saying "no". The evidence is there on our high streets, and as there is massive demand the only explanation is that greedy landlords are pricing competitive shops out.
- Reg, London
Is this not the same woman who wrote an article in the Sunday Times last fall called “Bonfire of the Bankers” dancing on the grave of Lehman Brothers and hoping it would lead to a banker exodus from her “‘hood”. I read it in disbelief while on a business trip to London. If you want everyone who’s making money (Americans especially it seemed) to leave Notting Hill, the bad news is…stores will close. What little I’ve read of Ms Johnson’s journalism strikes me as incredibly naïve.
- Charles, New York, NY
Then high rent is not helped by the business rates, which wait, are up again.
How is this possible, and helping businesses?
- Mario Kempe, london
A strange piece of fiction appears to have entered the minds of those who themselves have never run a shop (or indeed small business). That is that rents can only go up, which comes about as a result of misunderstanding "upwards only" rent reviews. They are only "upwards only" if you are prepared to pay them. Plan early enough (you surely know when your lease is up) and you can easily negotiate a rent based upon market prices (if indeed you are paying above a current market rent). Or a rent free period. The idea that landlords are trying tp put people out of business is nonsense. They want to achieve a rent which they believe the market can bear. Rachel, if you had to rent out your Notting Hill place for three years, and three months before the lease was up you were told by your agent that the current market is 50% ahead of what you have been achieving, are you saying you would not ask a new and higher market rent? The real threat to small businesses and shops is the endless regulations and rules and impositions by local authorities. The only thing "upwards only" which is non-negotiable of course is business rates...
- Damian Hockney, London, UK
Of course it's possible to negotiate terms and also possible to negotiate rents down. The above shop owner hasn't managed it but others have. The rents are so high because shopkeepers are willing to pay them. I don't have a shop in Westbourne Grove because I refuse to pay the high rents. If it's no expensive and doesn't make business sense, then don't rent the shop. Business is all about making a profit. If you can't make a decent profit when paying £87K rent, then you don't have a viable business. Stop complaining about the rents. Either negotiate a decent price or just say no.
- Steve Jones, London, UK
A caravanserai is - unlike Newsnight Review - a fixed inn, found in the East. That aside I have to agree you have a point about travelling to Glasgow to talk about events in the Big Smoke!
- Fergal Macerlean, Stirling, bonny Scotland
