Westfield’s leasing director Kate Orwin on physical retail being ‘back with a bang’

2023 was a strong year for Westfield shopping centres as physical retail saw a real resurgence, attracting 30 million people to White City and 52 million to Stratford in the full year.

With 83 new openings and upsizes, vacancy levels have fallen significantly and footfall is up by 6.1%, matching 2019 levels. 

However, when Kate Orwin joined the firm in the last lockdown after spending 18 years at Hammerson, things looked a little different for retail.

She describes the progress since then as ”heartwarming”.

“Physical retail is back with a bang,” she says. “The trajectory continues to be really positive. And we’ve seen that continue into 2024.

“You can feel it when you’re here. And in the school holidays, particularly, it’s absolutely buzzing.” 

Last year, Westfield brought its vacancy levels down to the lowest since Westfield London built an 800,000 sq ft extension in 2018. 

“It is one of our biggest success stories,” says Orwin. “At the end of 2023, we were at the lowest point for vacancy since the extension was built. So, since 2018, as a portfolio we moved from 9.4% [vacancy rate] at the end of 2022 to 6.9% at the end of 2023, which is a significant decrease.

“And we forecast another significant decrease for the end of this year. Demand is back, which is wonderful to see.” 

Summer of sport

The capital’s shopping centres are gearing up for another uptick in footfall as we head into a bumper summer of sport, improving their sportswear offers in anticipation. 

“We have upsized our sportswear,” says Orwin. “We’ve got a huge amount of new openings. New Balance has come into both centres and Under Armour has opened at Stratford.

“We’ve seen big upsizes and investments from existing sports brands like JD Sports, Sports Direct and Oysho. So there’s been a real boom in sportswear. And I think this summer will solidify that as people get on board.” 

She says Westfield is trying to offer a more diverse range of options to customers. Last year, it made way for French beauty giant Sephora’s big entry back into the UK, along with an upsize of the Boots beauty hall.

More recently, it also opened Bath & Body Works’ only standalone store in London.

Oriwn says the closure of department stores across the country has made space for good health and beauty retailers to enter shopping centres.

“Health and beauty was definitely – and continues to be – one of the best-performing categories,” she says. “It has been a complete resurgence and the closure of Debenhams and House of Fraser across the country left a big vacuum for beauty – and also for good health and beauty.

“Sephora coming in was just an absolute delight. It does restore your faith in physical retail when you’ve got 5,000 people waiting to get into one store. I mean, my goodness! But the same for Space NK opening, PureSeoul – and Boots, of course, pulled up their socks.”

In comparison, fashion has seen steadier growth, says Orwin, as much of the spending remains weather-dependent.

”Fashion is quite weather-dependent, but it’s consistent at the moment, which is good. And we’re still seeing the demand from fashion retailers, which is great to see. And hopefully, that will continue.

“Reserved is opening a massive new store at the end of this month and then a huge, upsized Uniqlo is opening in November.”

Nearly 20% of tourism spend is already back at Westfield, according to Orwin, but she says the tourist tax is still causing havoc. 

”The tourist tax is definitely impacting across the country,” she says. “It is a national problem. And I hope whichever government takes control will sort that out because it makes a massive difference. We have followed the trend generally in the UK in terms of luxury sales.”

“But luxury often goes through peaks and troughs. And actually, if you look at the sales generally, it’s come off the massive growth that it had, but it’s not declining. It’s just less growth than it was.

“Hopefully, if we do see a pick-up from Paris, because the Champs-Élysées and other luxury streets are closed [due to the Olympics] then it could be a good summer for London and luxury.”