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Tenants claim first year at Boxpark Wembley has been 'a disaster'

PUBLISHED: 10:01 22 August 2019 | UPDATED: 10:09 23 August 2019

Boxpark Wembley in Olympic Way. Picture: Archant

Boxpark Wembley in Olympic Way. Picture: Archant

Archant

Street food vendors have said they are struggling at a Wembley Park food mall and warned several are "on the brink of shutting" in the first year.

Tenants on 10-year leases at Boxpark Wembley have claimed they are struggling to meet the £51,500 annual rent and service charge due to low footfall. Picture: ArchantTenants on 10-year leases at Boxpark Wembley have claimed they are struggling to meet the £51,500 annual rent and service charge due to low footfall. Picture: Archant

Boxpark Wembley, which opened its doors in December 2018, was billed as "the ultimate fan zone" from a company that "champions start-ups and independent retailers".

But three tenants have abandoned their units in the first year of trading while several others say they are on the verge of going bust.

Speaking to the Times, the independent traders complained of eye-watering overheads including £52,500 in rent and service charges, sloppy fit-outs and low footfall.

In response Boxpark said some tenants were behind on rent and "not performing to our expectations".

One trader told the Times: "It's left a bad taste in my mouth. I wish I'd never signed the lease."

In July tenants emailed Boxpark ahead of a planned meeting asking to discuss the financial arrangements.

The double unit that until recently was occupied by restaurant chain Tapa Vino. Picture: ArchantThe double unit that until recently was occupied by restaurant chain Tapa Vino. Picture: Archant

They said they were at a "dangerous precipice" with several "on the brink of shutting" due to high overheads and low sales.

They added: "We must have a direct and serious conversation about the rent we are all paying. If Boxpark continue to ignore our struggles you will find a half-empty site by August."

In response they were told Boxpark would not discuss financial information "in a group format".

A tenant complained: "We're feeling that it's them against us."

What happened?

Tenants have said they Tenants have said they "struggle every day" at the venue and one reported making just £300 per day. Picture: Archant

Boxpark Wembley is the third venue of its kind in London, following similar projects in Shoreditch and Croydon that saw trendy "pop-up" malls erected from shipping containers.

Boxpark founder Roger Wade is a self-described "creative entrepreneur" who launched hip trainer brand Boxfresh in the 1990s.

Two companies associated with Boxfresh went into liquidation in the 1990s before the business was sold to American firm Pentland in 2005.

Earlier this month Boxpark announced plans to expand to another 10 sites across the UK in the next five years.

The Wembley venue is run by BPQW LLP, a joint venture of Boxpark Ltd and offshore-owned giant Quintain: the developer overseeing the regeneration of Olympic Way.

Vacant ground floor units formerly occupied by Wolf and Bombay Burrito. Picture: ArchantVacant ground floor units formerly occupied by Wolf and Bombay Burrito. Picture: Archant

Some 20 small businesses took on leases at Boxpark Wembley over the course of 2018, paying a £10,000 deposit.

But the traders have raised questions over the lease agreements they signed, as some said they were promised a "level playing field". Most say they signed ten-year leases but some claim to have an early "exit clause" and others did not. Boxpark said that lease terms do not vary.

In the past two months three traders, Tapa Vino, Wolf Street Food and Bombay Burrito, have closed their units.

Three parties told the Times they planned to take legal action, though Boxpark said it was not aware of this.

Tenants spoke to the Times on the condition of anonymity. One said: "If I could go back I'd run like I've never run before in my life. We have had a disaster."

A year's rent at Boxpark Wembley costs £35,000 and the service charge for the first year was set at £17,500.

Boxpark founder Roger Wade is a self-described Boxpark founder Roger Wade is a self-described "independent retail supporter" who recently announced plans for 10 more venues. Picture: Joe Lord

On top of that, according to the government's website each tenant could be expected to pay between £7,400 and £24,250 in business rates per year.

A tenant said: "Everybody accepted the conditions but it doesn't seem to be working. We were encouraged to use a contractor to fit the unit and we spent about £15,000 of our own money to redo it again."

New arrivals were encouraged to use an external company, Catering Projects, to have their units fitted out.

The firm was described to them by a Boxpark representative in August 2018 as a "competitive contractor".

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Public social media posts suggest the managing director of Catering Projects, Mark Barnes, had a friendship with Boxpark founder Roger Wade that pre-dated the Wembley launch.

Both are based in Brighton and went to a football game and on a skiing holiday together in 2017.

Boxpark's management said the firm was a "well known, major supplier of kitchen equipment" with a track record with other brands such as Nandos and Wagamama, that tenants had been under no obligation to use. There is no suggestion that the friendship between Mark Barnes and Roger Wade had any bearing on the recommendation.

On the ground at Wembley, though, some tenants had a rocky relationship with Catering Projects.

Documents seen by the Times show traders were billed for up to £80,000 and paid third parties later brought in by Catering Projects for installation and insurance - bringing their totals to between £100,000 and £120,000.

Several reported serious issues with the work, including the wrong items being delivered, equipment arriving that did not meet size specifications, and equipment installed with a potentially hazardous fault.

Documents seen by the Times also show some items were also billed for up to six times their stated value online.

One tenant said: "We love our business and brand, but we have been set back a year or two. We can't pay the rent and we struggle every day."

Catering Projects did not respond to a request for comment.

Low footfall and atmosphere leaves some tenants scraping by

Nine months after the park opened traders said footfall was "nowhere near" expected and the types of events did not place enough emphasis on food.

One tenant said: "We were told the plan was for Boxpark to be quite upmarket and were expecting something with a bit more class, more of a gourmet food destination, not a party/rave, pub/sports bar environment."

Ticketed events, tenants said, restricted passing trade, as did the introduction of a £10 "guaranteed entry" charge on football match days.

Because of prohibitions on alcohol sales in the leases, the only licensed bar taking in cash from booze sales is the Boxpark-branded one, meaning tenants can make no money from alcohol sales.

A tenant said: "People get in early and drink all day, and eat once, so on football days we can't even break even."

The company said footfall at Wembley was "in line with our expectations" and claims tenants were struggling to break even on ticketed days were "untrue".

What the owners said

Complaints by Boxpark Wembley tenants echo those voiced by a number of tenants at Boxpark Croydon since 2018.

On that site, where around a dozen traders closed in a six-month period, some tenants are reportedly now threatening a group legal action.

Mr Wade did not respond to questions directly but a spokeswoman said the firm was "proud of our record of launching and supporting London's most exciting creative talent".

She added: "Our tenants are the lifeblood of Boxpark. We work with them as partners and support them when they are struggling.

"We currently have a small number of tenants with outstanding rent. However, we have a pipeline of new tenants waiting for units at all three sites."

The spokeswoman added: "We accept there is work to be done to improve performance. We are working alongside tenants to help them improve performance where required as we share the same goals."

The Olympic Way site was bought as part of a wider package of land by Quintain in 2005 and leased to Boxpark for an undisclosed sum.

Brent Council voted unanimously in favour of plans by Quintain to redevelop the Wembley Park last September: the same month that its American owner, Lone Star, dropped its plans to sell Quintain for £2.2billion.

A Brent Council spokesperson said the tenants at Boxpark Wembley were likely to be entitled to business rate relief.

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