Network Rail in new rent rise row with businesses after 200 per cent hike

Rent rise: Ali Sharif says his car repair business would be forced to close by the increase
Mark Chandler19 February 2017

Businesses at a set of east London railway arches warn they could be forced to close after Network Rail announced a rent hike of more than 200 per cent.

Traders at the arches in London Fields, some of whom have been there for decades, say some people have already been forced to leave by the huge increase.

Derec Hickman, from Chu’s Garage, which has been at the site for 28 years, said businesses had started receiving threatening letters about the changes over the past six months.

He told the Standard: “When we started this was like an abandoned archway with people shooting up in it back when Hackney was the murder mile.

“You used to have drugs and criminals going past everyday and now we have hipsters instead.

“We’ll accept there’s a knock on effect but it’s not feasible for a business to suddenly, without warning, have to increase their overheads by that amount.”

Mr Hickman said Network Rail had originally tried to increase their rent from £18,000 a year to £45,000. Despite negotiating that down by £5,000 the business would still find that unaffordable – and it’s not alone.

Ali Sharif, who has run Sharif Auto Services in two of the arches for seven years, said his rent was sent to rise from £30,000 to £100,000.

He told the Standard: “This will force me out of business. There’s no way I can sustain that rent, I can’t afford it.”

“It’s a huge company, I know they don’t care but we care and the community cares,” he said. “If they start driving the businesses out they will suffer.”

Traders, including the London Fields Brewery and furniture firm Poetstyle, have now come together as a group to fight the increases, which they claim are based on a vastly exaggerated market rate.

Mr Hickman said: “It’s not feasible. But everybody’s of the same spirit. When I walked around talking to everybody the fighting east end spirit is so strong it really inspired me.”

And Mr Hickman said he had come across other similar businesses in Hackney facing the same problem, with suspicions that Network Rail, under pressure to offload its property portfolio, wants to sell them off.

A spokesman for Network Rail said: “Network Rail’s commercial estate has 182 arches and units in the London Borough of Hackney.

“We are obliged by the Government to deliver value for the taxpayer and all of the money generated by our estate is reinvested back into the railway.

“We aim to deliver value in the local communities in which we operate, supporting a growing economy with businesses and jobs.

“We currently have six rent reviews ongoing in the London Fields area and negotiations are ongoing between us and our tenants or their representatives.

“Where rent reviews are due, we negotiate with our tenants on a consistent but individual basis to find an amicable settlement.”

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