The much-vaunted Westfield London scheme at White City may have bagged Louis Vuitton for its planned luxury retail area, but can it really draw top-name brands and big-money customers away from the West End? Ben Cooper reports
A shopping centre has always been the last place you would expect to see top-end luxury retailers. For decades, London’s West End has been where the mega-rich have gone in search of the most exclusive clothing and accessories, but Australian developer Westfield is challenging this tradition by bringing luxury to the mall in its Westfield London development at White City. Lettings have kicked off well with the prestigious signing of Louis Vuitton, but the plan remains a gamble. So can Bond Street luxury be transferred to a shopping centre in W12?
The challenge for Westfield will be to ensure there are enough people with enough money spending enough time in the shopping centre’s luxury area. Luxury retail by its very nature is exclusive and Westfield London will be a mass-market centre, with Marks & Spencer, Next, Debenhams and House of Fraser among the main stores.
The developer has set aside 200,000 sq ft (18,580 sq m) of the 1.5 million sq ft (139,350 sq m) scheme for luxury retail. The area, with a working title of The Village, will cover three floors and comprise high-end retailers, restaurants, patisseries, cafe a gym and a spa.
With renowned architect Michael Gabellini consulting on the design, the look will be bright, plush and very modern to frame the exclusivity of the retail offering. The New York-based architect specialises in luxury retail, having worked with German fashion designer Jil Sander on her Paris shop and Hamburg headquarters, and been involved in the design of the Ultimo boutique in San Francisco, the Nicole Farhi store in New York and the 80,000 sq ft (7,430 sq m) Armani centre in Milan.
Getting Louis Vuitton on board last August was a key signing for Westfield and effectively placed the upscale fashion brand as The Village’s anchor. Although the luxury retailer has yet to be joined by any others, there are rumours that Tiffany and Christian Dior may come on board soon.
Westfield London will be the highest-profile shopping centre opening of the year and the scheme is eagerly awaited not just because of the developer’s global reputation, but also because of the impact it could have on the capital’s established retail locations.
Whether a luxury area can work at the scheme is down to three key factors. First, with an opening only eight months away, Westfield needs to attract more luxury retailers to The Village concept. Second, the developer needs to attract the right demographic, including London’s international wealthy, so that the luxury brands will have confidence in the type of shopper who will come to White City. And finally, The Village needs to address the question of identity. The tradition of luxury retail on Bond Street and Sloane Street is strong and Westfield’s tenants must decide where they will position themselves compared with their West-End counterparts.
Westfield declined to comment but, while the lettings situation is fairly tense at the moment, agents in the market believe that deals will be done. Cushman & Wakefield partner Peter Mace says this is inevitable, because of the nature of the luxury market. “A lot of luxury retailers like to sit next to like-minded brands,” he explains. “The difference is that when you’re dealing with luxury brands, they don’t have a huge programme of store openings and they spend much more time deciding where to open.”
Mace believes the situation will remain quiet while the retailers tentatively wait to find out who has agreed to join the scheme, but he expects the rate of signings to accelerate between now and the summer.
West London’s affluent demographic, which the centre is targeting, is perfectly suited to the retail offering likely to be available, according to Harper Dennis Hobbs director David Harper, who advised Louis Vuitton on its move to the centre. “It’s about time somebody did something different,” he says. “White City is unique and I think it will be complementary to Bond Street and the West End. I think the market for luxury has widened. It has become more accessible and people are more aware of what’s out there.”
The complete retail offering at the Village is likely to prove a major draw. Churston Heard director of central London retail Richard Scott believes that the area’s unique blend of retailers will prove a key asset to Westfield London as a whole, and rather than competing with the West End it will become a separate entity in its own right. “It’s a fantastic coup for Westfield, there’s no other shopping centre that’s got this,” he says. “But I don’t think that anyone going into White City thinks it’s going to compete with Bond Street or Sloane Street.”
And the success of the scheme will be affected by the offering that each retailer will provide. Where The Village is likely to do well is with the slightly less wealthy aspirational shopper making special purchases, according to Scott. “It won’t be a luxury destination, it’ll be for the one-off luxury purchase,” he says. “I think what will happen is that it will become very gift-oriented. They will get the type of person who makes a special purchase once a year.”
Mace believes that if upscale retailers such as Tiffany do take units in The Village, they will have to offer the lower end of their product range if they are to be successful. “The key differential if you look at Tiffany and Louis Vuitton is that they sell million pound jewellery, but they also sell silver for£50 and with this I think they will do very well. They can’t go in with their whole range,” he says.
The danger, according to some, is that there simply isn’t the demand for another luxury destination in London. The strength and renown of Bond Street and Sloane Street around the world are such that for a luxury area in a shopping centre to work, it must offer a unique draw away from the West End.
Savills in-town retail team associate Rob Hargreaves explains: “If you’re going to go to Louis Vuitton or Tiffany to spend a lot of money, would you do it in a shopping centre environment rather than walking down Bond Street? Some people go to Bond Street for the experience and maybe to see some celebrities.”
For this reason, Westfield London poses no threat to Bond Street, according to Keith Wilson, a partner at Wilson McHardy which acts on behalf of exclusive retailers in the West End including Chopard, Diane Von Furstenberg, Stella McCartney and Balenciaga. “There are genuine concerns from the luxury brands about how the high-end area is going to fit within the luxury retail market in London,” he says. “If somebody wanted to buy an expensive piece in Cartier, they would go to Bond Street. I’m not quite sure that the shopper on the high street or even the high end of the high street is naturally a luxury shopper.”
While Westfield London will be a first, luxury retail centres have been tried in other smaller clusters. The Royal Exchange in the City of London is surrounded by some of the highest earners in the country and the retail offering is a mixture of high-end fashion, accessories and jewellery, and includes some of the most exclusive big-name brands. However, the tenant line-up has evolved, because some retailers found it hard to make the scheme work for them.
While The Royal Exchange has by no means failed, it has become popular for its jewellery and accessories offering, catering for affluent City workers making gift purchases rather than as a luxury fashion destination.
Scott explains: “It’s a location where potentially there are plenty of the right customers, but they’ve found it hard to make it work above the gift market.”
Westfield is facing a trying eight months. With only one retailer confirmed for The Village, time is running out. Most fashion retailers will have finalised their winter collections by now, and to be ready for an October opening the window for making a final decision is shrinking by the day.
Whether or not the gamble will pay off depends on what definition of luxury Westfield chooses for The Village. Trying to compete with the lavishness of Bond Street is a risky strategy for a shopping centre, whereas offering a type of luxury that shoppers occasionally allow themselves to indulge in could still be a huge success.