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Westfield, bouncing baby of the shopping world
Sri Carmichael, Jonathan Prynn and Benedict Moore-Bridger30 Apr 2009
London's largest shopping mall is defying the recession with 500,000 visitors a week including a host of celebrities, its boss said today.
Westfield's managing director, Michael Gutman, told the Evening Standard the £1.6 billion, 43-acre precinct in Shepherd's Bush was on track to exceed its annual target of 20 million visitors.
The complex, which opened six months ago, has become the shopping destination for Girls Aloud, David Attenborough and TV chef Jamie Oliver. Many of England's cricketers, Gary Lineker and Geri Halliwell have also been spotted there.
The positive outlook comes as Westfield today announced it was taking the pressure off retailers by reducing service charges.
A dispute over the fees to maintain the complexhad strained relationships with tenants, who were keen to cut costs during the recession. At £14 per square foot the charges have been around 50 per cent higher than anywhere else in Britain.
A group of 23 leading chains including Body Shop, Boots, Debenhams House of Fraser, Marks & Spencer and Waitrose were locked in talks about a reduction for months. Westfield said the charges were set high because of the sheer scale of the shared space that required cleaning, lighting and maintenance, but it is now able to put in place a more precise rate after six months of operation.
Today Mr Gutman said: "Yes, they'll be a reduction. This is what we've been doing at our other seven buildings in the UK, where we recently reduced service charges by 10 per cent.
"We're starting to get to the point now at Westfield, with six months under our belt, of understanding the trading patterns of the building and getting a much more precise view of what the service costs should be.
"A decision will evolve within the next few months. We're working with consultants and service providers to get to the right rate for the building. I expect to get to a solution that's agreeable to all. There will be an adjustment at the end of the year."
In a clear reflection of retailer confidence, the much-awaited Louis Vuitton store is to open next month, after a delay to allow it to double its size.
Last week Rob Templeman, chief executive of anchor tenant Debenhams, singled out the performance of the Westfield branch as it posted a 10 per cent rise in profits.
Waitrose said sales at Westfield were 2.5 per cent ahead of budget compared with a national average of 1.9 per cent above forecasts.
Sales of barbecue and deli counter food were said to be particularly strong.
The Louis Vuitton opening appears to underscore the way Westfield has transformed the way Londoners shop, providing the prestige of Bond Street and the high-street edge of Oxford Street under one roof, without the cramped pavements and parking problems.
Mr Gutman added: "We're establishing a new business in a new location in a very difficult time and we're happy with the way things have started. We're really delighted with that.
"The feedback from many of the retailers is that their Westfield store is in the top five in their portfolio.
"We're a fraction of the size of the West End but we've seen flagship retailers like Apple and Nike doing exceptionally well at our centre.
"We haven't created Bond Street or Knightsbridge - that's not what we're about here, it's about democratising luxury." The Shepherd's Bush precinct paves the way for a similar project in the East End.
A £681.5 million shopping centre is set to be built in Stratford near the 2012 athletes' village.
Westfield has put other schemes in its global portfolio on hold during the recession but believes time-pressed Londoners have shown they are ready to embrace the concept of a giant, inner-city mall. Nevertheless, Mr Gutman admitted the slump in consumer confidence at the start of the year was a challenge and six of the 280 shops had closed as companies across Britain went into administration.
But he added: "We're starting to see some kind of stabilisation. We're starting to see some more positive signs from consumers than we've seen for some time." The recent influx of tourists to London, lured by the weak pound pushing down the costs, was a big boon to the centre, he added.
Sales to non-euro zone overseas shoppers at Westfield were up 27 per cent in March on the previous month.
Mr Gutman said: "Take a walk around here at a weekend and you'll hear Spanish, Italian, Russian, Chinese. Foreign shoppers are a significant area of growth." The mall has 45 concierges speaking 14 different languages.
Westfield is the biggest investment by a private company in the capital for decades, with £170 million spent on building two new stations to serve the complex, one overground and one for the Tube.
The central atrium is the size of a football pitch and if the 96 escalators were placed end to end they could take a shopper to the top of Ben Nevis and down again.
The Westfield group runs 119 malls in four countries - the US, UK, Australia and New Zealand.
Reader views (6)
I have been to Westfield twice now and have to say that it is very impressive.
It is light, spacious and relaxed with a very pleasant atmosphere.
Additionally the parking is very reasonable, there is a huge selection of shops ranging from the "Bond Street" exclusives like Versace & Moschino to regular high street favourites like Boots and M&S.
If, as I did, you find yourself lost in this vast cathedral of rampant consumerism - worry not. The many touchscreen islands dotted around the centre will draw you a route from your location to wherever you want to go.
Lovely range of eateries aswell - Whatever you want : Thai,Nandos,Sandwiches,Sushi,Italian,Coffee,Burgers it's all there.
My advice is : Get down to Westfield - everyone's a winner!
- Dan H, Fontvieille,Monaco, 12/05/2009 08:35
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I quite like Westfield. A pleasant, civilised environment to shop in. It's proximity to the White City Estate means i can't totally forget the outside world, but otherwise i have no issues with it. They don't take the pi$$ with the parking charges - unlike the majority of councils in London - and i can eat something other than burger or fried chicken. If 'the high street' is suffering, it's due to the fact that a lot of them are cheap and tacky beyond recognition now.
- Tom, London, 01/05/2009 10:43
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I live just down the road from Westfield. Everybody here thinks the mall is crap. But what I really wanted to say is that I can't believe the PR Westfield is getting in this piece. It looks like slick spin. All the details are there, the many positive qoutes and mentions of minor celebs, the word-wrap embraces of the trouble Westfield has, and the reassuring details of how wisely Westfield is acting on a global scale. It sounds like a press release. And worst of all, the massive spin on the fact that Westfield is now cutting service charges and 'know better the real cost picture'. Ha! Which one of your editors let this piece run?
- Mac In Kensington, London UK, 30/04/2009 21:35
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I've personally seen David Attenborough signing copies of his new book in WH Smith at Westfield.
- Jean, LOndon, 30/04/2009 18:21
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Surely not David Attenborough. This God in human form who has warned us so compellingly about the man made evil that results in global warming would never set foot in such a resource wasteful, hedonistic temple to mammon. One only has to think of the poor polar bears to know he could never do such a thing.
Someone must have spotted a look-alike out to create some mischief.
- Steve, London, UK, 30/04/2009 14:54
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"without the cramped pavements and parking problems"
That hits the nail on the head, and explains why the high street is in decline compared to hypermarket shopping. Shoppers want a pleasant, safe, unintimidating atmosphere.
This could be delivered by planners, but the latter prefer to subsidise residents' parking on-street instead of providing visitor parking, because these residents "need" to commute to Westfield. The result is narrower pavements as resident parking effectively reduces street width, preventing pavement expansion.
It is important that, in the future, no-one is able to say that this was the result of consumer choice. Planners must accept their full authorship of the decline of the high street.
- Reg, London, 30/04/2009 11:39
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