Westfield backs down on service charges

Westfield has backed down in a dispute with tenants over service charges – a sign that it is suffering in the economic downturn?

Europe’s biggest urban shopping mall was drawn into a dispute with 23 retailers over the charges it levied for shared facilities at the 43-acre centre in West London.

Now The Times reports that Michael Gutman, the managing director of the £1.6 billion centre, has conceded that the charge will be adjusted. “Yes, there’ll be a reduction,” he said. “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.” Westfield had charged £14 per sq ft, about 50 per cent more than most other centres.

<!–
function pictureGalleryPopup(pubUrl,articleId) {
var newWin = window.open(pubUrl+'template/2.0-0/element/pictureGalleryPopup.jsp?id='+articleId+'&&offset=0&&sectionName=IndustrySectorsRetailing','mywindow','menubar=0,resizable=0,width=1000,height=711');
}
//–>

Martin Crossley, of King Sturge, a property consultancy, told The Times: “The reality is that Westfield has failed to perform. It looks fully let – but talk to the retailers and they’ll say they’re on very good terms.” Rent for prime spots at Westfield is thought to be about 30 per cent below Bluewater, Kent.