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E-commerce fears behind delay of £1.4B London project, council chief says

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E-commerce fears behind delay of £1.4B London project, council chief says

Westfield Group and Hammerson Plc's £1.4 billion Croydon Town Centre-Expansion project in the U.K., which has been beset by delays since planning permission was first granted in 2014, was held back by the developers amid fears over the impact of e-commerce on the retail market, according to Croydon Council's chief executive.

Jo Negrini, who joined Croydon Council in 2014 as executive director of development and environment and worked with Westfield on its Stratford City development during her time as chief borough planning officer at Newham Council, told a Nov. 21 meeting of the London Assembly's regeneration committee that the developers' concerns have resulted in a major revision of plans for the retail, leisure and residential project. The revised plans landed unanimous approval from Croydon Council earlier this month.

"Some of the reason for the delay in Westfield in Croydon was exactly [because of e-commerce's growth], that the whole nature of retail has changed in the last couple of years and there's much more focus around click and collect," she said. "And that actually had a major impact on the [planning] consent that we've just granted."

"The reason for the delay was what was going to happen with the retail market: Is there a market for these big supermalls anymore when people are doing a lot of online shopping? And I think that's still kind of a major factor," she added.

SNL Image

The Croydon Partnership's plans for London borough
involve a £1.4 billion retail, leisure and residential
development in the town center.

Source: Hammerson

Westfield and Hammerson's Croydon Partnership, a 50/50 joint venture, previously said the delays were due to protracted conversations with retailers about how best to accommodate them in the new development. A number of retailers from the Whitgift Centre, set to be replaced by the development, are expected to open stores in the new shopping center.

Construction work, which had been expected to begin in 2018, has been pushed back to 2019, Westfield's development director, Steve Yewman, told the Croydon Advertiser Nov. 15.

The initial master plan for the 1.5 million-square-foot Westfield Croydon was proposed in 2013. In late 2016, a revised outline planning application was filed to include up to 1,000 new housing units, among other things. This year, planning meetings in April and June to approve the development were canceled, with the first cancellation due to "finalization of negotiations." Local politicians and Croydon residents have consistently expressed their frustration with the delays.

The new plans for the development, which will have to be approved by London Mayor Sadiq Khan before progressing, are a response to the change in the way some consumers shop, said Negrini.

"There's much more opportunity for people to come, drive their car into Croydon, pick their goods up and leave through click and collect," she said. "There are going to be major differences between the [Westfield] Stratford particularly and the Croydon one, [with Westfield Croydon] actually building in those changes to the way that people do their shopping," she added.

Responding to Negrini's comments, Hammerson did not address the assertion that fears over the impact of e-commerce were a factor in the delays. The company said in an emailed statement that the new design was broadly faithful to the original plans.

"The masterplan maintains the design principles of the original 2014 consented scheme, with the enhanced plans responding to the evolving retail landscape to enable a greater provision of larger flagships stores, diversity of leisure and entertainment and wider public realm," Hammerson said. Westfield was approached for comment but did not respond by the time of publishing.

A completion date for the project is still unknown and is dependent upon the progress of work over the next 12 months.

"There are still a number of milestones to hit next year including detailed design work for the scheme, concluding the compulsory purchase order and land assembly process and finalizing legal agreements with prospective anchor retailers. The expected construction period is 3.5 years," Hammerson said.