A trader who claims he was forced out by developers may have to pay hundreds of thousands for a replacement shop.
Rakesh Patel, owner of Pricebusters, is facing a cripplingly expensive bill to relocate his shop, after his last one was knocked down for redevelopment.
Developers Delancey had promised to help traders at the old Elephant and Castle Shopping Centre with their relocation costs. But Rakesh claims they are not fully honouring this deal, leaving him to pay “hundreds of thousands of pounds” for a move “none of us wanted.”
“The whole thing is so expensive, I could not believe it when I realised how much I will have to pay,” said Rakesh. “The contributions of the developers are not even enough to get the project over the line.”
Rakesh needs nearly £1 million to move and kit out his new 3,000 ft shop and has raised £550,000 himself, yet he says the amount Delancey is offering as a contribution is “nowhere near enough.” He was unwilling to provide exact figures, statting they were commercially sensitive.
“I am not looking for a freebie,” said Rakesh. “I am putting in funds that are huge, and I have had to borrow to get things moving. They [Delancey] promised us they would support us when we were thrown out of a place we were doing just fine in. Now we’ve been left out on a limb,” he added.
In a statement, Delancey’s Elephant and Castle team said: “We have been working extensively with Pricebusters to ensure their successful relocation, meeting regularly with them over many months.”
“We have offered Pricebusters significant support to meet their needs to cover the fit out costs for the new unit.”
Rakesh and his family ran Pricebusters, a popular DIY and hardware store, for more than 35 years and said business was “quite comfortable before the famous closure.”
He explained that his relocation costs were so high as the new site being offered to him by developers Lendlease was “literally a shell.”
It is without flooring, lights, sprinklers and plumbing, which Rakesh needs to pay for before the shop can open.
One of his main concerns is that developers have not clearly explained how they calculated their contribution.
“I am not being unreasonable,” says Rakesh. “I want them to at least make me understand how they came to these arbitrary figures.”
Rakesh claims the money set aside by Delancey to help traders from the old shopping centre cover their relocation costs was “obviously not enough.”
He said Delancey committed to spending £640,000 on helping some 120 traders find new premises, in a deal struck with the council.
This agreement allowed the developer to demolish the old shopping centre, and redevelop Elephant and Castle.
Rakesh says at the time traders were “reassured” that in the deal Delancey promised a “discretionary” fund should traders require more money. But there isn’t a fixed amount,” said Rakesh. “Discretionary means it is up to the developer to decide how much they want to give.”
“It could be ten pounds,” he added.
He also complained that “not a single unit” at the new Elephant Square development, which was supposed to house displaced traders, was “anywhere near the size” he needed, while Rakesh’s bids on other sites in Walworth Road were “gazumped”, despite the fact that negotiations “were halfway through.”
During his yearlong “battle” with Delancey, Rakesh’s business has not been able to trade and he has suffered a “big economic hit.”
“There are six families depending on this,” he said. “They are all worried about how everything will pan out … it has been difficult for all.”
He claims Pricebusters was given only six months’ notice to move, although discussions about developing the centre had been ongoing for years.
Responding to these allegations, Delancey said: “We want these long-standing traders to be successful and are committed to doing all we can to see the retail destinations thrive. We will continue working hard on progressing the relocation process as effectively and swiftly as possible, as well as supporting all those traders who have already relocated.”
Rakesh hoped Delancey “would see sense” and find a better agreement with him.
“I just want to get the store up and running again as soon as possible,” he said. “We need to restart our lives.”