Romford Town Centre: 1968-2020

Liberty One, 1968, was the first phase of three linked shopping malls. Phases two and three were Liberty Two, 1990, and The Brewery, 2001. Romford town centre is a dull retailing monoculture. This was irrelevant until Lakeside, 2004, and Westfield Stratford Shopping Centre, 2011 provided better retailing experiences. Latterly e-commerce, a systemic threat, which has been turbo-charged by the Covid-19 pandemic, reconfigured utilitarian shopping. Malls predicated on utilitarian shopping must reinvent their retail offer to survive.

Destination shopping centres should offer a pleasing environment. Romford doesn’t. Plentiful toilet facilities are a necessity. A single set of toilets serve Liberty One and Two. The food courts of the Westfield Shopping Centre, enhance shopping as a leisure activity. Romford has been captured by retailer whales operating out of huge uncompromising units. The Cosgrave ownership period was a disaster as they tried to milk it for yields far beyond what was feasible. (see Addendum)

E-commerce murders utilitarian shops. It demonstrates retail is either a utilitarian transaction or an experience. Romford’s shopping malls can only compete as a leisure activity. Unsuccessful mall owners go to the wall: Intu and Hammerson’s are prime examples. (see Addendum)

Romford is facing an existential crisis. It does however have a competitive advantage because it’s a population centre. Romford’s retail monoculture could be softened by independent traders supplying a ready made customer base living in the proximity. Stranded retail whales, like Debenhams, demand a rethink. This rethink doesn’t include tinkering with variations on the failed strategies of 1968.

Addendum One: the shopping mall crisis
Britain’s biggest mall owners* have suffered catastrophic share price declines. This means the existential crisis hitting Romford town centre is systemic. A systemic challenge requires a fundamental shift in thinking. Cosgrave Property appear to have sold the centre. If the reported price is correct they made a 29% loss in 12 years of ownership, in line with expectations in 2006:
“Cosgrave expects ‘to push rental yields at the Liberty Shopping Centre to 5%’. But sellers Hammerson put this year’s [2006] rental yield on Liberty at just 3.5%, which indicates, say surveyors, that the Cosgraves might have overpaid.”**
The new owners are apparently looking to convert retail to housing. This is a sound strategy.

Addendum Two: The Marks and Spencer site
Late in 2019 Havering Council bought this site for £13.8 million. It was impeccable bad timing. All the signs were in place demonstrating that shopping malls are in terminal decline (see above). This is a classic example of a failure in Council procedures as it wasn’t robustly reviewed by the relevant Overview and Scrutiny committee or stress tested.

* For Intu’s five year share price movement see https://www.hl.co.uk/shares/shares-search-results/i/intu-properties-plc-ordinary-50p
April 2015 = 330p; April 2020 5.17p
For Hammerson’s share price movement see https://www.hl.co.uk/shares/shares-search-results/h/hammerson-ordinary-25p-shares
April 2015 = 650p; April 2020 = 58p
** https://www.thisismoney.co.uk/money/news/article-1601635/500m-UK-property-grab-by-Irish-family.html

Sources

For historical pictures see https://www.romfordrecorder.co.uk/news/romford-pictures-havering-s-proud-brewing-history-explored-in-new-exhibition-1-3215943 and also http://breweryhistory.com/wiki/index.php?title=Ind_Coope_Ltd
For Debenhams see https://www.google.co.uk/search?sxsrf=ALeKk01115XWDCSdQ0hBYzGEcBqLbkIE3Q%3A1587657067576&source=hp&ei=a7mhXtzXIMqmaLujuqAJ&q=debenhams+administration+2019&oq=debenhams+administration&gs_lcp=CgZwc3ktYWIQARgBMgIIADICCAAyAggAMgIIADICCAAyAggAMgIIADICCAAyAggAMgIIADoFCAAQgwE6BAgjECdQwgpY_1lgnnJoAXAAeACAAVWIAc4LkgECMjSYAQCgAQGqAQdnd3Mtd2l6&sclient=psy-ab
For a hint of the council’s thinking see https://authenticfutures.com/romford-town-centre/
Cosgrave Property appear to have sold the town centre for a £81m loss https://haveringspecial.wordpress.com/tag/cosgrave-property-group/
For a quick press overview see https://www.romfordrecorder.co.uk/news/havering-council-consultation-romford-town-centre-improvements-1-5863512
For a 2016 press review which reflects many points made in this blog see https://www.romfordrecorder.co.uk/news/shoppers-and-small-business-owners-fear-for-romford-s-retail-future-1-4691214
For a report on the new owners see https://haveringspecial.wordpress.com/tag/cosgrave-property-group/
For a recent Council discussion see https://democracy.havering.gov.uk/documents/g6286/Public%20reports%20pack%2025th-Feb-2020%2019.30%20Towns%20Communities%20Overview%20Scrutiny%20Sub-%20Committee.pdf?T=10