Rents threaten Chinatown fabric

Some now fear that in five years Chinatown will lose its traditional cheap and cheerful eating houses - and character - and become an upmarket, charmless version of its old self.

Patricia Brown, chief executive of Central London Partnerships, said: "We have got to make sure Chinatown remains part of central London as a culinary and entertainment destination."

Dr William Cheng, part-owner of Tai Ka Lok in Gerrard Street, says his restaurant will have to close if the landlord, Shaftesbury, succeeds in tripling his rent from £63,000 to £178,000 a year. The case will be going to arbitration next month and could trigger a damaging domino effect if the landlord wins. Another 50 restaurants and shops in Chinatown face similar disputes.

At present the area is fully let. Chinese restaurant numbers have risen by 50 per cent since 1991 to around 65, with additional Japanese, Malaysian and Vietnamese establishments moving in.

Shaftesbury is by far the largest landlord in Chinatown, owning 58 restaurants, 44 shops and 53 flats. Its Chinatown assets are reputed to be worth £75million, and make up 27 per cent of the company's assets. It insists that its duty is to improve returns for shareholders.

Nigel Collins, director of property agents Ashley Associates, who is acting for Dr Cheng and two others, says the rents demanded in Chinatown are astronomical, in some cases more

than four times as much as in nearby Frith Street or Old Compton Street.

The rent escalation began last October when the restaurant owner at 8 Gerrard Street was turfed out after failing to renew his lease. Shaftesbury was able to offer the unit with vacant possession and the new deal was agreed at a rent 25 per cent higher than anything seen in Chinatown before. This higher rent is now being used as the new yardstick. Dr Cheng looks like being the first - but not last - victim.

The fact that Tai Ka Lok has been feeding people since 1979 is unlikely to make a difference.

Dr Cheng suspects Far East gangland money may be laundered in Chinatown through the takeover of property. "I think we are beginning to attract these types of people because the rents are so high that unless you are extraordinarily wellmanaged you are unlikely to make enough profit," he said. "I would say the landlords will start to have a lot of undesirables on their books which they will have difficulty dealing with."

But Shaftesbury chief executive Jonathan Lane denied the company's policies were detrimental to the area. He said: "We are listening to the community and whatever might be said, there is still an increasing demand for good quality restaurants."

Mr Lane said he wants to follow Hong Kong's example by putting more shops at ground level to give visitors more choice, and to open restaurants on upper levels, where the rents are cheaper.

Dr Cheng concedes that if he loses, his restaurant will find a buyer in spite of the higher rent, perhaps another one of the Aroma chain, of which three have already opened. His regret is that this will happen repeatedly and things will never be the same again.

Westminster councillor Glenys Roberts said: "I shall be very sorry if we lose the traditional small businesses which attract tourists as well as locals. It is already very difficult for them to survive market forces."