Dozens of small businesses are facing rent hikes and may need to find a new home as their premises have been bought by a new landlord.
About 40 new business owners in the arches under the train tracks on the Bath Factory Estate in Herne Hill said they were “horrified” when they learned that their new landlord, Arch Company, would be increasing the rent.
The Arch Company, which made a £134m profit after tax in 2021, bought the arches in February this year and told residents that rents would be going up, with some quoted increases of between 20 and 30 per cent.
Dermot Jones, who runs the South London Makerspace workshop and is a member of the Guardians of the Arches group set up to represent business owners in arches nationally, said there had been an “economy collapse at the arches”.
Mr Jones said businesses in about half of the arches were “actively looking elsewhere”.
At least six businesses on the estate have told the South London Press they are leaving or have already left, with others claiming they are trapped by the amount they have already invested in their premises.
Some traders claim they have had little to no contact with Arch Company since it took over and have not been told their rents are going up but expect it to happen so are making preparations to leave.
Some tenants have also been offered ‘tenancy at will’ arrangements, which entitles a landlord to evict a tenant with no notice.
Arch Company said it was a standard arrangement offered as a bridging gap for those out of lease.
Half Moon Studios
One trader, Half Moon Studios, has decided to leave the premises as its rent increased by a third – £900 – and said it would likely fold as a business as a result, after 30 years in operation.
Susie Perring, 76, helped establish the printmaking business and said the rent rise would likely spell the end of her career.
She said: “It’s not something any of us wanted. We can’t afford to pay the kind of money the Arch Company wants us to pay.
“We were the first people to do the negotiations and I got it down as low as I could, but the fact is it’s still too much for us. I don’t know what else to do.”
Ms Perring claimed Arch Company added insurance and VAT, which they hadn’t paid before, and feared service charges on top as well as increased electricity costs.
She said: “Our expected yearly outgoings are too much for us to cope with. It’s very confusing because you know at some point you have to stop working but it’s come rather more quickly than we all thought. It’s been very difficult.
“We always envisaged carrying on until we dropped dead. It’s hard to think what life could hold.”
Steven and Jamie Whitehead
Father and son Steven and Jamie Whitehead said they have been on the estate for 25 years.
They have largely operated as car repairs and parts specialists, but are now packing up their arches with nowhere to go.
Jamie was paralysed in a car crash in 2010 and has set up a gym in the arch for exercise and works on car repair projects there.
Jamie said: “I’ve had to take my gym down already. So I haven’t been exercising for the past two months. I’ve always kept up on my exercise. That’s packed down ready to go because I can’t afford to lose that equipment. That’s essential to my health. If they come down and say ‘yeah you’re out’, I’ve got nowhere to put it.
“I’ve been here since I was a child. It’s been a home away from home, not just the workshop. It’s been a place where I grew up. And my brother, we’ve been here since we were four or five.
“It hasn’t been just a workshop. It’s been a community.”
Steven said he had not paid rent since the Arch Company took over because he claimed they had not confirmed what the rent was for.
He also claimed that an Arch Company representative had visited the estate once and told him he was no longer allowed to sublet his other arches on the estate.
He said: “Rents in general are just crippling, not just work, it’s crippling home life. It’s getting to the point now where London is not really a place to live, it’s just a place to survive.”
Non-profit community fruit and vegetable supplier Local Greens said the Arch Company intends to increase its rent by 22.5 per cent.
Company co-founder Jean Bergin said rent and added insurance will add about £2,500 per year for the company.
She said a knock-on effect of paying more in rent and other fees could mean the property is valued at a higher rate, so they may then be required to start paying business rates, adding a further £3,500 in costs per year.
She added that because they are a non-profit organisation they could not take out any loans or overdrafts.
“In three years they will have taken the best part of £9,000 from us in return for nothing. That’s dipping in to our reserves that we could use to give our staff a bloody livelihood.
“Our costs are really tightly controlled so that we can stay in business, but having external influences such as the Arch Company looking for a large increase in rent is something we can’t control and it seems unethical, immoral, all the other words you can think of.”
“We as a very small business who’ve built up some reserves in order to sustain ourselves during this difficult time have got to give that to a multinational company because of pure greed.”
Dallas and Angel have run their art space, DNA Factory, out of the estate for more than 20 years, but say they are preparing to leave as they expect a rent increase to come their way.
They claim the Arch Company has made no contact with them and that they have continued to pay the rent at the rate before it took over, but that any rent increase would see them forced to leave.
“They’ve been nothing but unprofessional,” said Dallas. “You couldn’t make it up. They’ve had no contact. Absolutely nothing with us.
“From a creative point of view you need to have a stable environment where you can do your creative stuff and with this hanging over us it’s very difficult, because you never know, they could be coming after us next month.”
A spokesman for Arch Company said: “We want the Bath Factory Estate to continue as a thriving home for small businesses.
“We have tried to make the transition from the previous intermediary landlord to The Arch Company as smooth as possible, including honouring all existing lease agreements, and will continue to do so.”
Pictured top: Business owners at the entrance to the Bath Factory Estate (Picture: James Twomey)
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