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Why The Sale Of UK Railway Arches Is A Disaster For Underground Music
Ed Gillett , September 20th, 2018 09:28

In a move that has gone unnoticed by most, Network Rail has sold off its thousands of railway arches, many of them home to venues, clubs and studios that are vital for the health of independent culture. Ed Gillet explores this grievous threat to the UK. Images all from the Quietus 10th Birthday rave at Corsica Studios by Zbigniew Kotkiewicz

If you live in the UK and have even the faintest interest in underground music, chances are you’ll find yourself enjoying it under a railway arch at some point in your life: getting sweaty to some pounding techno in a dimly-lit club, pondering a sound art piece in an under-the-radar gallery, or just finding an inexpensive rehearsal room in which to hone your craft.

For decades, railway arches have housed thousands of independent businesses for whom traditional high street locations remain off-limits due to noise, mess or cost. For creators and supporters of grassroots music, where profits are precarious and suitable spaces constantly at a premium, the low overheads and enviable sound insulation provided by a thick dome of British Rail brickwork have been a priceless resource.

However, it’s currently unclear how long this state of affairs will last. Earlier this month, Network Rail announced the sell-off of their entire property portfolio, including some 4,500 railway arches, to the private sector. Their buyers are the massive private equity firms Blackstone and Telereal Trillium, whose joint £1.5bn bid saw off rival offers from Goldman Sachs and several others from amongst the global financial elite.

A number of the small arch-based businesses who’ll soon be paying their rent to a massive new corporate landlord have voiced their frustration at Network Rail’s plans. Not unreasonably, they’re concerned that Blackstone and Trillium will be looking to maximise returns on their investment, increasing the risk of aggressive rent hikes and the eventual shunting-out of less profitable tenants.

Several family-run businesses have already been forced to the wall by shocking rent increases, a move which some claim was intended to increase the apparent value of the properties and drive up their sale price (Network Rail have denied this is the case). A campaign group named Guardians Of The Arches has been set up to advocate for tenants who see their futures threatened.

While these stories have prompted heated debate in the media and in Westminster over the potential impact on independent businesses in general, there has been little public attention paid to the implications for the UK’s cultural sector, and the vital role played by arch-based music spaces in particular.

At a time when restrictive licensing decisions and Brexit-induced jitters are creating problems across the live music industry, small-scale venues already face something of a minefield. With little clarity or reassurance about what the sale might mean for arch-based music spaces, these risks feel worryingly under-addressed.

One of the spaces potentially affected is Corsica Studios, home of The Quietus’ recent 10th birthday mega-rave, and nestled under the platforms of Elephant and Castle station in South London, its impeccable lineups and fierce soundsystem have marked it out over the last decade as one of the capital’s most important music venues. For Adrian Jones, who runs Corsica, the sale poses an existential risk.

”We’ve been in one form of railway property or another since we took on our very first studio space in Kings Cross in 1997, and we’ve had good relationships with both London and Continental Railways and Network Rail throughout that time.

“However, in the last 12 months our rent has almost doubled. We’re still dealing with the impact of this, especially as the rent increase was backdated so we were effectively in arrears from the moment it was implemented. We do have some reserves tucked away for emergencies but if the rent increases again significantly it will present us with a real issue.

At this point I don’t think anyone really knows what sort of approach the new landlords will be taking, but ultimately they have invested a large chunk of money and they’ll expect to make a return. I’d say there’s general feeling that rents will increase, which is obviously a concern.”

Sean Akins is a Director of DHP Family, the group which owns the arch-based Oslo in Hackney, as well as the Garage in Highbury and half-a-dozen other venues across the UK:

“Network Rail have always run their estate as ancillary part of their business, which is why you see so many arches occupied by cottage industries, who provide amenities for their local area. They’ve obviously looked to get income from these spaces, but they’ve also been conscious of not posing a risk to their viability, and they care about other issues beyond maximising rent: they’re not in it for a quick buck.

As soon as you pass that over to a commercial outfit, things change: they will be looking to squeeze every last drop out of their investment, which will inevitably lead to higher costs for tenants. This is also part of a wider problem, though: grassroots music venues are not usually money-spinners, and it’s quite a fragmented industry, so this is also just an example of what happens when rapacious landlords squeeze the pips”.

It’s alarming to hear things stated quite so bluntly by a company of DHP’s size, whose broad portfolio of venues and events, and close connection to the multi-million pound property developer Bildurn, can presumably help them ride out any losses. If operators of DHP’s scale and Corsica’s cultural standing are this downbeat, what does that say for smaller venues?

Worryingly, many of them seem to know little about the sale or what it might mean, despite assurances from Network Rail that they’ve been kept fully informed. The owners of Gorilla in Manchester say that they “have very little to report in all honesty on the subject matter: it’s been a long running rumour since 2013, with no real date given for closure and pack up”. Brighton’s Under The Bridge tell me “We have no idea how this is going to affect us or why anyone else has told you they think there will be ill effects”. The Engine Rooms rehearsal studios in Bow say that they’ve “been told about the sell off, but that is the beginning and end of the information we’ve received on the matter” and allude to negative experiences with Network Rail during their tenancy.

Network Rail’s response to concerns regarding the sale is simple enough. Since their creation in 2002 from the ashes of the terminally dysfunctional Railtrack, their role has been to “run, improve and grow the railway” not act as commercial landlords. They argue that they should be able to focus on that core work, and use funds from the sale to strengthen the UK’s rail infrastructure.

In this, there is a nod to their less-than-rosy financial state, weakened by falling passenger numbers and deep spending cuts. Last year’s annual report by the rail regulator ORR revealed that Network Rail projects were being completed 5% less efficiently than three years previously, with their debt predicted to hit £53bn by 2019.

In February of this year, they announced a 33% reduction in the amount of money set aside for future projects; in a line which could have come straight from The Thick Of It or Yes Minister, CEO Mark Carne described this dramatic downsizing as “in a way, more ambitious” than their previous plans.

When describing the sale of their property portfolio, Network Rail’s repeated go-to phrase has been the similarly satire-compatible “business as usual”. It appears with such metronomic regularity in their press releases and statements that it takes on an uncanny stiffness, reminiscent of Theresa May’s brittle and transparent assertion during the 2017 election campaign that “Nothing… has… changed!”

As with the Prime Minister herself, there’s rather less detail available on exactly how Network Rail or their buyers will ensure that “business as usual” is achieved in the medium to long term. When asked, before the sale is announced, whether conditions will be attached to it protecting vulnerable tenants from unmanageable rent rises in the future, they skirt around the question:

“It will be business as usual for tenants as their leases and rent arrangements will transfer to a new owner and be protected for the length of their tenancy, just as they are now with us. We can’t comment on a new owner while the sales process is ongoing but we believe a new owner will invest in and develop the estate to its full potential.”

As part of the sale Teleral Trillium have announced a “tenants’ charter”, which makes warm but imprecise promises to “engage with all tenants and communities in an open and honest manner” while offering no guarantees on rents.

When trying to clarify how Network Rail have accounted for the cultural value of creative spaces in particular, and the importance of these spaces to communities which rely on them, things get even foggier.

They provide a list of cultural “success stories” which is headed, bizarrely, by The Arches in Glasgow. Forced into administration in 2015 after the drug-related death of a clubgoer and the subsequent restriction of its licensing hours, The Arches remained shuttered despite an impassioned campaign fronted by Franz Ferdinand, Belle and Sebastian and Mogwai, reflecting the venue’s central importance to Scotland’s music scene over the previous 24 years. It finally reopened this year as that most 2018 of things: a street food market and artisan bakery.

Whatever safety-related concerns Glasgow Licensing Board may have had, it’s difficult to see The Arches’ enforced closure and subsequent rebranding as anything other than a desperately sad loss to Glasgow’s musical community. It’s hugely concerning that Network Rail would instead consider this progress, and it raises questions about the extent to which they or their successors might distinguish between different forms of cultural activity.

The simple answer, it seems, is that they don’t: “We don’t differentiate between different types of cultural space, but we are committed to a diverse mix of businesses within the estate and recognise the importance of this mix as part of a community. We have supported a great number of arts and music venues, working with them to find suitable venues, moving them to bigger spaces if they outgrow their first.”

The two other cultural spaces Network Rail highlight in detail are the superb LGBTQ+ theatre Above The Stag, successful enough to relocate to larger premises in 2016, and the Old Union Yard Arches, a row of recently-renovated spaces including a Spanish and Latin theatre, community venues, an “aerial fitness school” and the requisite smattering of trendy restaurants.

For all their evident qualities and importance to under-represented communities, both of these ventures share a distinct air of investor-friendly politeness. Underground nightclubs and gig venues are no less culturally vital than theatres or upmarket eateries, and have played just as important a role for marginalised groups, but Network Rail’s messaging belies the fact that these sort of spaces represent a much trickier sell to mainstream opinion, and are far more often the focus of scepticism and scrutiny from neighbours and local authorities.

For venues whose benefits may be harder to communicate, a vague commitment to “diversity” is unlikely to inspire confidence: a plurality of perspectives and identities is essential, but if these are only ever expressed within narrow economic and aesthetic bounds, then that inclusiveness becomes compromised. The precise forms of diversity which Network Rail, Blackstone or Trillium are willing to champion remain frustratingly unclear.

That lack of clarity is reflected across government. Sadiq Khan’s office have made plenty of noise about their support for music venues, but their statements on the sale remain vague: they’re “currently exploring the potential impact of the National Rail property sale and will continue to work to safeguard London’s venues”. The city’s Night Czar Amy Lamé, recently the focus of sustained criticism over her lukewarm response to a clampdown on license applications in Hackney, has been noticeable by her absence from the conversation.

Ironically, it’s Hackney Council who have taken the most ambitious approach to the question of railway arches. In June, they wrote to Transport Secretary Chris Grayling offering to buy the leases to the 187 arches within their borough, and continue running them with public benefit in mind rather than just private profit. Rebuffed by Grayling, they’ve since tried again with his deputy Jo Johnson. Tenants’ group Guardians Of The Arches have also written to Grayling, asking him to intervene in the sale: given that Network Rail are ultimately answerable to the Department for Transport, he and his colleagues are uniquely placed to shape the process.

It is unfortunate, therefore, that Grayling is by some distance the most rabidly incompetent Cabinet member in living memory, responsible for the violently botched privatisation of the probation service while Minister for Justice, and Universal Credit’s grim rebranding of Dickensian poverty while at the DWP.

In his two years at DfT, he’s merely overseen the wholesale collapse of commuter rail services across the UK, an unprecedented disaster which nonetheless represents a perverse form of career development for him. As with all his other mishaps, Grayling’s response has been to feverishly blame anyone but himself: his preferred scapegoats this time are Network Rail, now the subject of increasingly toxic media briefings and veiled threats.

This would be an unhelpful backdrop for even the most perceptive and consensual of politicians to negotiate on behalf of tenants, let alone a man branded “the idiot’s idiot” by political commentators. Sadly, the Guardians Of The Arches and the ratepayers of Hackney would be better off sacrificing their children to the ancient Norse gods than expecting Grayling or his subordinates to fight their corner.

There are two lobbying groups you’d normally expect to see fighting for the interests of small-scale music spaces in situations like this: both are aware of the issues inherent in Network Rail’s plans, but there’s little evidence of either treating the sale as a strategic priority.

“This is a work in progress” says Mark Davyd, CEO of the Music Venues Trust, which represents small live music venues. “We don't yet know how many grassroots music venues are impacted. It's clearly a concern, but so far it seems to be less widespread than I initially imagined.”

The Night Time Industries Association looks after clubs, meanwhile: Chairman Alan Miller locates Network Rail’s sale within the wider context of decades-old failures by Governments of both stripes to deal with demands on urban space, or manage competing interests productively. "Many well known music and nightlife venues exist in arches, bringing vitality and new life to areas, economically and culturally,” he says.”Keeping this infrastructure intact, and reversing the dire state of Britain's approach to its interests and future, will require robust, dynamic investment from both the private sector and the state.

“We've heard stories of short term leases imposed on venues and huge rent hikes in arch spaces, in spite of Network Rail’s pledge that any sale would retain the integrity of lease agreements. We encourage Network Rail to join the Mayor of London and others in recognising the value of licensed premises, and work together with the industry, smart Councils and developers to ensure that they're properly protected."

The sale appears to be pulling political and industry onlookers in two conflicting directions: the sheer size of the financial forces at play are beyond anyone’s ability to influence, while the specific problems affecting small venues are too diffuse to grasp precisely. It’s hard to escape the feeling that, despite good intentions on several sides of the debate, independent venues are being left to look out for themselves.

It’s therefore unsurprising to see venue owners respond with a similar sense of resignation: while Oslo has another 10 years on its lease, they concede that “in the long term, there’s not a lot we can do” to prevent the upward pressure on rents when the time comes. For smaller venues on shorter leases, without the political or financial muscle to challenge these proposals, what other option is there but to hope for the best, keep the music playing as long as possible, and be ready to move on when the time comes?

Adrian from Corsica Studios sums up the predicament facing small venues, or indeed any small business run for love rather than money: “We need to have a certain amount of people attending to reach the figures we need to pay for our staff, rent, running costs etc but an event's commercial appeal never over-rides whether we feel it is right for Corsica or not. This approach may well have to change if we are faced with substantial rent increases, but we’d all feel extremely sad if this is what were reduced to, and it isn’t something that I’d be personally able to feel good about.

“There is only so much distance we can bend before the whole thing becomes an exercise in making money for its own sake, and I’m not prepared to sacrifice my creative interests and values for that.

“To be honest, we have never, ever felt particularly secure where we are, so this is not a particularly new experience for us. We have always kept an open mind about where we are located and are always on the lookout for new opportunities and premises, in case the time comes for us to move.

“That being said, it is not at all easy to find the right premises or location for something like Corsica to work so I can imagine it being an enormous challenge if we ever do have to re-locate.”

The UK’s underground music scene has certainly coped with threats and closures before, not least those connected to Network Rail: the loss of the Astoria and other venues to make way for Crossrail, or the acrimonious shutdown of Cable during the rebuilding of London Bridge station. Each time this has happened, the communities which thrived in these spaces have found somewhere else to go: no doubt they’ll end up doing the same again here if the worst happens, continuing to create beauty out of adversity and precariousness.

There are deeper issues at stake, though: is it right or justifiable to keep expecting underground cultures to quietly accept these setbacks for the sake of corporate profits? For how much longer can grassroots spaces be squeezed, relocated and drained of identity before that process becomes unsustainable, and the UK’s creative diversity withers away? Are we really doing everything we can to protect culturally vital but non-corporate spaces against more powerful financial interests?

However large or small a role Network Rail’s property sale ends up playing in this wider discussion, our collective response to it acts as a stark and ultimately depressing reminder that these fundamental questions remain stubbornly unanswered.

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