Elephant and Castle Redevelopment Displaces Local Businesses Amid Gentrification Concerns

Diana Sach once employed more than 30 people and catered for hundreds more every day from her Latin American restaurant and delicatessen, famous for its Peruvian empanadas, in south London’s Elephant and Castle district.

Now, she looks longingly at the shiny tall buildings that have replaced the brightly coloured but shabby shopping centre that was her home from home before being demolished in 2021.

“I hoped to be part of it. But there has been delay after delay and now I can’t see how it will happen for me,” says Sach.

The Elephant, which will this month welcome its first commercial tenant – the matcha-serving Blank Street Coffee – and where residents are due to move in later this summer, is part of a £500m redevelopment of the south London landmark once renowned for its urban deprivation.

A modern town square surrounded by tower blocks has replaced the old shopping mall – a brutalist fortress surrounded by spooky underground walkways and tunnels, which was one of Europe’s first large indoor shopping centres when it opened in 1965.

It is the latest step in the multi-billion pound reinvention of the area, which has seen the neighbouring Heygate housing estate demolished and rebuilt as modern towers, with shops and eateries on the ground floor, surrounding a leafy park.

The opening of the Elephant, which includes about 40 shops, restaurants and bars as well as a cinema and gym, a new home for the London College of Communication, 55,000 sq ft of offices and hundreds of flats – all watched over by the former centre’s distinctive statue of a pachy­derm carrying a tower on its back – marks a new start for the area after years of construction.

The regeneration plan has been the subject of wrangling between local people, the council and developers since the 1990s, with residents nervous that their needs would be steamrollered along with the mall in favour of gentrification.

It is part of an ongoing battle across London, and other UK cities, between communities and redevelopers.

Oli Mould, professor of social, cultural and historical geography at Royal Holloway, University of London, says the redevelopment of Elephant and Castle, which began with the razing of Heygate, is almost “‘patient zero’ of London’s gentrification.”

“A lot of these processes happen quite fiercely and quickly in London then spread across the country,” he says.

Mould suggests the new development has created an “identikit homogeneous gentrified place”, which risks “destroying the very thing that makes a community thriving and beautiful in the first place”.

Sach, who came to the UK from Colombia 30 years ago, is not alone in feeling there is no place for her in the Elephant development.

She says the developers, Get Living, and Southwark council have failed to honour promises that her restaurant would find a new home.

She and the 90 displaced Latin American businesses that brought colour to Elephant and Castle were told there would be adequate temporary accommodation for them to maintain their businesses during construction. But only a handful found a new place to trade on the temporary site. For the restaurant and cafe owners, the shoe boxes on offer within a stack of metal containers, now set to be dismantled, proved unviable.

Many closed down as the difficulty in finding an appropriate alternative site, compounded by the impact of Covid, took its toll.

Once the development was completed, the businesses were told a more permanent, low-cost sites would be available in the new Elephant development or new streets nearby.

However, fewer than half of the displaced small businesses are being offered new premises in the neighbourhood.

Alongside Blank Street Coffee, a Marks & Spencer food store, a Pret a Manger, an Everyman cinema and DistriAndina, a Latin American supermarket currently based in the neighbouring railway arches, are among the first signed tenants.

Only five of the 40 commercial sites are being set aside for the return of local businesses at affordable rents, as well as 10 small spaces within the railway arches.

A food market hall, expected to be run by the Blend Family operator, will have space for 14 small food stalls, but none have been specifically set aside for former tenants of the defunct mall.

It is a similar story above the shops and restaurants, where there are 485 homes to rent across three towers, including just five at social rent tenure, 45 on London living rent (LLR) terms and 124 at discounted market rent. A further phase of the development, yet to be built, will add 116 social rent, 12 LLR and 37 discounted market rent homes.

Get Living says it is “working closely with Southwark council to finalise the affordable retail strategy, with a clear commitment to ensuring that eligible independent traders from the former Elephant and Castle shopping centre are given first priority when applying for discounted market rent units within the Elephant”.

It says the “ambition is to create a vibrant and diverse town centre, and a core part of making that happen is ensuring it continues to support the local and independent businesses that make Elephant and Castle what it is today”.

On a tour of the site, Rick de Blaby, the outgoing boss of Get Living, acknowledges local people have experienced a “decade of destruction”, demolition and rebuilding.

“In the end, the developers have got to show them it was all worthwhile. We have got to make it a place people engage with and come back to time and time again, where they can connect and feel safe,” he says.

John Batteson, Southwark council’s cabinet member for climate emergency, jobs and transport, said he was committed to “keeping the cultural diversity that makes Southwark such a special place”.

He said it was a “cast-iron condition of planning permission” that the developer must provide affordable retail space for local businesses and traders.

However, today it feels as if the independent shops, cafes and restaurants that inhabited the area, bar a few exceptions, have been priced out, making way for a more corporate, orderly vision, similar to many other developments across Britain.

Even those independent businesses that have found appropriate space in the wider Elephant and Castle redevelopment say they are struggling to hang on.

Dario Lopez, an accountant representing the few Latin American businesses that managed to secure premises nearby, says most now fear they will need to leave, despite having taken out large loans to fit out their shops, cafes and restaurants.

Miko, a Venezuelan restaurant, started life as a kiosk in the old shopping centre before taking up residence at the base of a new tower block.

Lopez says Miko’s owner, Lenin Erazo, was offered a lease with zero rent in the first year, rising to £3,000 a month at the end of a five-year period.

Now, he is in dispute with a new landlord, who wants to double the rent to more than £6,000 a month.

“The area is still a building site, and in the first five years the developers have failed to invest in anything that will bring people from outside the area to visit. There are homes, but nothing to increase the footfall for local shops,” he says.

Mould says local authorities and developers looking to revitalise town centres should be wary of what they could lose as well as what can be gained through redevelopments.

“You can address problems without having to displace people with multi-billion pound programmes. If you can make a developer out of the community, that’s better,” he suggests, pointing to efforts by traders in south London’s Brixton to buy their colourful local market.

“It might not make as much money short term, but longer term it keeps cultural vibrancy in the area, which makes it attractive and makes people want to come.”