Search

London Fields arches traders take fight to Network Rail over soaring rents

PUBLISHED: 07:00 13 February 2017 | UPDATED: 11:44 20 February 2017

Traders from businesses along Helmsley Place. Picture: Polly Hancock

Traders from businesses along Helmsley Place. Picture: Polly Hancock

Archant

Experienced business owners sat huddled around a table in London Fields Brewery last week to come up with a survival plan.

The arches in London Fields. Picture: Polly Hancock The arches in London Fields. Picture: Polly Hancock

They’d made the short walk from their units under the arches in Helmsley Place and surrounding roads for a summit meeting to discuss Network Rail’s devastating rent demands.

The transport body has been sending out letters to its tenants over the last six months informing them of 200 per cent rent hikes.

For the industrial firms, that’s as good as closing them down.

To them, it’s like being told: “Thanks for all your hard work transforming this barren wasteland into a thriving trade hub – but we’ve got it from here.”

Ali Sharif of Sharif Auto services. Picture: Polly Hancock Ali Sharif of Sharif Auto services. Picture: Polly Hancock

What’s more, if they don’t challenge the rent demands within 28 days, the rise is brought in automatically.

So on Tuesday, in a show of solidarity, bosses formed the London Fields Arches trade group. The idea is to share information about their individual negotiations and ensure no one is picked off.

And the Gazette was there to hear their stories.

“When we came no one would come around here,” said Quang Chu of Chu’s Garage. “It was drug dealers and prostitutes. If you walked down the road you would be looking behind you, even in the day! Now they want us out.”

Hugo Ramos, managing director of London Fields Brewery and Noemi Dulischewski founder of Berlin Brunch. Picture: Polly Hancock Hugo Ramos, managing director of London Fields Brewery and Noemi Dulischewski founder of Berlin Brunch. Picture: Polly Hancock

Chu’s Garage is one of the businesses that would have no choice but to leave Hackney, and its customers, behind.

Derec Hickman, who is married to Quang’s daughter, continued: “We asked them if they understood a 200 per cent rise was the same as closing us down and begged them not to do it.

“We offered 20 per cent more but they have refused and keep threatening us with arbitration. They have never treated us like this before.”

The rail giant, which is part publicly owned, has 182 arches in Hackney and is one of the biggest commercial landlords in the country. But it is reportedly ready to offload its portfolio to raise much-needed funds.

Charlie Fox outside Poetstyle Charlie Fox outside Poetstyle

One tactic being used is the offering of smaller rent increases for those with assured tenancies – if they give up that assurance and sign new three-year leases. Ominous.

Some London Fields traders have already left. Of 40 units, eight are vacant – but only one is on the market for rent. Network Rail says that’s because they’re set to be refurbished before being let out to independent firms, but traders believe chiefs are biding their time before selling.

To them, this is David v Goliath. What Network Rail argues is “market rate” is simply not. Hackney mayor Philip Glanville even wrote to chairman Sir Peter Hendy in December telling him to be more reasonable.

For traders who have been there years with a “light industrial” planning use, the average rent is £12 a square foot. The average overall is £18 a square foot.

But the water is somewhat muddied by the introduction of the cafes and restaurants, who can afford to pay more. One recently settled on rent of more than £50 a square foot, which Network Rail has apparently attempted to use as a yardstick.

Interestingly, despite threats of independent arbitrations to determine a fair rent, only once in the last six months has it happened. Derec believes this is because the arbitrator would settle on a significantly lower figure than the one quoted by Network Rail.

To be fair, Network Rail is one of the largest landlords of small and medium sized businesses in the UK, with less than 20 of its 4,000 plus London arches let to chains.

A spokeswoman told the Gazette negotiations were ongoing with six tenants to find an “amicable settlement”.

“We tailor our letting strategy to reflect the needs of the borough and look forward to meeting the mayor soon,” she said.

“We are obliged by the government to deliver value for the taxpayer and all the money generated by our estate is reinvested back into the railway.

“We aim to deliver value in the communities in which we operate, supporting a growing economy with businesses and jobs.”

–––––––––––––––

Case study: Ali Sharif

Ali has run Sharif Auto Services for six years. He currently pays £30,000 a year and has an assured tenancy but was told during a rent review Network Rail now wants £100,000.

“It’s completely unsustainable,” he said. “They want us out. I have five kids to support.

“We have two arches and we offered to give up one, but they said they want £60,000 just for one. And they want us to pay £40,000 to have them separated.”

–––––––––––––––

Case study: Hugo Ramos

The managing director of London Fields Brewery said: “When we came this was no man’s land. It gave us the opportunity to create a business and for the last seven years we’ve been part of Hackney. We started the craft beer revolution and London Fields wouldn’t be what it is today if it wasn’t for all these small businesses. The soul will be gone.”

–––––––––––––––

Case study: Charlie Fox

Charlie has been making furniture in London Fields for more than 25 years with his firm Poetstyle. He’s currently negotiating with two different owners over his railway arch and his warehouse space.

“They want a 250pc increase,” he said of Network Rail. “We were told about a month before Christmas, which was nice.

“I said I’ve already had a 2pc increase this year because of the terms of my lease and I think that’s enough.”

“The only chance to fight it is to all get together.”

Related articles

0 comments

Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files
Comments

Please log in to leave a comment and share your views with other Hackney Gazette visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by Hackney Gazette staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Not a member yet?

Register to create your own unique Hackney Gazette account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now

Latest Hackney Stories

The O’s will play at least 14 games between now and the end of 2017 and host league leaders Macclesfield Town this weekend

The O’s won at Brisbane Road on Tuesday and now have two more home fixtures coming up over the next week

12:30

Slaven Bilic’s men will host Premier League new boys Brighton & Hove Albion in a Friday night match.

Spurs have had a solid opening few weeks with victories achieved over Aston Villa, London Bees and Bristol City

To mark the centenary of the October Revolution, the Gazette looks back at a “way-out” church in De Beauvoir that hosted Lenin, Stalin and Trotsky for a crucial conference – and put the Bolsheviks on the road to power.

Each week, the Gazette takes to the streets to unearth something being manufactured right here in Hackney. This week we visit Kate Sheridan’s HQ in Lower Clapton Road where she makes some of her handbags.

The former editor of the Gazette - who was also a famous ventriloquist - died aged 95.

11:13

A prolific wheeler-dealer and his goons staged a scam auction in Dalston flogging his second-rate perfume under the guise of high-end cologne by the likes of Hugo Boss and Victoria Beckham.

Education and Training

cover

Read the
Education and Training
e-edition today

Read Now


Newsletter Sign Up

Sign up to receive our regular email newsletter

Most read news

Show Job Lists