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Rents too high, say Westfield Woden retailers

Shoppers outside Godfreys at Westfield Woden Plaza.

Shoppers outside Godfreys at Westfield Woden Plaza. Photo: Jeffrey Chan

At least three businesses positioned between the supermarket behemoths of Coles and Woolworths, in Westfield Woden, will close in coming weeks, forced out by high rents and a retail downturn.

Small business owners say they are feeling the pinch from a combination of competition from the supermarkets and a general downturn in consumer spending in the centre, although Westfield has been inflexible on the rent being charged.

''Rents are killing us,'' said one business owner, speaking on the condition of anonymity. ''There's not a very good outlook for small businesses here.''

The entrance to Westfield Woden Plaza in Canberra.

The entrance to Westfield Woden Plaza in Canberra.

Both Edelweiss Gourmet Deli and the Godfreys vacuum cleaner shop were advertising closing down clearance sales on Monday morning, although centre management was seen ordering the removal of the signs, which are not permitted under the conditions of the lease.

Godfreys is closing on March 3, with the shop manager saying that a new lease arrangement could not be negotiated.

Edelweiss is closing on February 28, after more than 40 years in the centre, as it also could not reach a lease agreement with Westfield.

Another local business owner, Peter Martin, will close his shop on February 28, but spoke on condition his franchise was not named.

''Small business in the ACT is capitulating really,'' he said. ''The last three years, we've lost so much money it's not funny.''

Westfield reduced his rent by ''a small amount,'' but not nearly enough to keep him afloat.

''It's minor compared to the losses that we made and the reduced customers. We're averaging 750 customers a week less than what we were in 2009, 2010.''

Mr Martin puts it down to the ACT having the largest amount of space per capita, not helped by the addition of the Majura Park shopping centre, and the loss of jobs in public service departments in Phillip.

''It's becoming a one-stop shop as far as Woolworths and Coles goes as well,'' he said of the increasing need to compete with the giants.

Other businesses are still negotiating new leases with Westfield and weighing up their future too, something Mr Martin said could be devastating for the remaining shops.

''People won't want to come here … they're going to see shops boarded up, it's going to look like a ghost town,'' he said.

''Westfield need to wake up to their business model. They're getting too greedy with what's happening in the economy and they need to take a few blows like everyone else has.''

Another business owner with time still left on his lease agreed, saying there was a significant downturn when Westfield extended paid parking to the weekend as a ''money grab''.

''It killed the weekend trade,'' he said, also on the condition of anonymity.

''The way people shop has changed too, we used to get a lot of flow off [the supermarkets]. When they were busy, we'd have a really good day, but [cost of living pressures] made them all tighten up with what they buy and Woolies and Coles are both basically a one-stop shop.''

A Westfield spokesperson said it does not disclose details of tenancy negotiations, but works closely with retailers to ''meet their needs and expectations in a realistic way''.

''It's a normal part of business for there to be a degree of turnover in the make-up of retailers at any centre, however, at Westfield Woden, this is no higher than usual,'' the spokesperson said.

9 comments so far

  • How sad! Edelweiss has been at Woden forever! I remember when Woden Plaza used to contain loads of local small businesses and provided employment to a lot of local young people. I actually hate going there now it's a Westfield - generic chain stores, pumping music, kiosks jammed into every square metre so people can hardly move. It's stressful.

    Hope these business owners find a way to keep going without having to deal with the Westfields of this world.

    Commenter
    Yearbook
    Date and time
    February 18, 2014, 1:13AM
    • While rents have an impact,I think the service at two of the businesses mentioned have gone downhill over the last few years.

      Commenter
      James
      Location
      Canberra
      Date and time
      February 18, 2014, 9:09AM
  • Charging GST on online goods from OS won't make a difference to consumers. It's the overheads such as rent that causes much of the high retail costs. I really feel for the retailers...

    Commenter
    Dk
    Date and time
    February 18, 2014, 6:00AM
    • It's time for us as a collective to rise up and fight these multi nationals before it's too late. Canberrans, we need to show coles, woolies, westfield et al that we've had enough of the ruining of them forcing out the little people. So what if it costs you a bit more, support the small business for a week or two. Show these companies that we are prepared to support small business in this country. It won't hurt you as much as it's hurting the little fella who works 14 or 15 hours a day. So come on canberra stand up and fight for the underdod.

      Commenter
      steve
      Location
      chisholm
      Date and time
      February 18, 2014, 8:34AM
      • steve, you are right on the money the problem being though as I have found with other things in the ACT most are creatures of habit and while they agree with you theory they don't put it to practise because each person assumes all others are doing it.

        Commenter
        NITRO GANGSTER
        Date and time
        February 18, 2014, 9:55AM
    • Perhaps some of these businesses could relocate to any of the numerous boarded-up, abandoned tenancies at what used to be called DFO? Now THAT is almost a ghost town (plenty of people walking around on the weekends, but fewer and fewer shops).
      Years since they vacated, Westfield in Woden still doesn't seem to have found a tenant for the vast space once occupied by Harvey Norman. This story may go some of the way to explaining why.

      Commenter
      Gcbr
      Location
      CBR
      Date and time
      February 18, 2014, 9:35AM
      • At the core of the problem is the ruthlessness of the Westfield business model and the Lowrys. You only have at the some of the things they have done in the USA. Nothing resembling sentiment exists in their world. Not even permitting a shop to put up a closing down sale sign is pathetic!

        Commenter
        JD
        Date and time
        February 18, 2014, 9:56AM
        • I wonder whether there are local shopping centres that might benefit from these small businesses having to find a new location. Westfield Woden is opting for the big players with no local connection. Perhaps small businesses would benefit from highlighting their years in the community when they shift. Now is a good time to find out where their customers come from by asking for a postcode or suburb at the checkout and noting it down.

          Commenter
          YS
          Date and time
          February 18, 2014, 10:15AM
          • Westfield have traditionally gouged their lessee, in the us its the other way around, they work with them. Here, they seem to have a strategy of driving retailers out of business so they can move the next lot in...

            Commenter
            Steveu
            Date and time
            February 18, 2014, 1:31PM

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