Home Commercial Property Westfield faces competition for Croydon shopping centre

Westfield faces competition for Croydon shopping centre

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31st Jan 12 2:53 pm

Retail giant Westfield’s plans to open a third London shopping centre in place of the Whitgift Centre in Croydon could be derailed by a row between the owners of the current facility, it has been reported.

Westfield became a development partner of the 42-year-old south London shopping centre in November after agreeing a deal with the Whitgift Foundation, which is the freeholder and a 25 per cent leaseholder.

Mayor of London Boris Johnson was among the public figures to welcome the plans to redevelop the Whitgift Centre, but Reuters reports that the shopping centre’s other two leaseholders are unhappy because they were not consulted.

Royal London Asset Management and Irish Bank Resolution, formerly Anglo Irish Bank, have now drawn up their own shortlist of major property developers without consulting the Whitgift Foundation.

Although Westfield is on the list of candidates to take on the major refurbishment and possible expansion of the Whitgift Centre, it faces competition from six other parties, according to Reuters.

British Land, Hammerson, Land Securities, Lend Lease and Delancey are believed to on the new shortlist of potential development partners for the 1.2 million sq ft retail facility. The developers will make their cases at a presentation later this week, it is believed.

Commenting after an apparent deal with the Whitgift Foundation in November, Westfield said it was attracted to Croydon because it was “under-served by high quality retail and leisure facilities”.

Westfield, which already has shopping centres in White City and Stratford, said the new centre had the potential to serve more than three million customers.

Property investors are particularly keen on large shopping centres because they tend to dominate their catchment areas and have performed comparatively well during the recent turbulent retail climate.

The Whitgift Foundation would need to approve of any deal between Royal London and Irish Bank Resolution and a developer, but it is unclear what will happen if they do not rubber stamp a contract.

Royal London and Irish Bank Resolution are set to offer the chosen developer a minimum 25 per cent share of their combined £200m stake and the responsibility of managing the centre. A developer is expected to be chosen by the end of February.

Westfield has 124 shopping centres around the world and total assets under management worth approximately £40bn.

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