East London-based charity Craft Central will close its doors at the end of the month, citing financial pressures including high rent and rising utility costs.
East London-based charity Craft Central has announced it will close at the end of the month.
The charity, which has been operating for 50 years, will stop trading on 29 February. The closure will see four staff lose their jobs, alongside one regular freelancer.
A statement from the charity’s board of trustees cited a variety of financial pressures, including high rent and rising utility costs, for the decision.
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“You may be aware that the organisation has experienced extreme financial difficulties since moving from our building in Clerkenwell Green in 2017, which were further compounded by the effects of the Covid-19 pandemic, rising costs, particularly utility bills, and a decline in funding for arts and crafts in the UK,” the statement said.
It added that measures implemented by staff and trustees to improve its financial resilience - including making one staff member redundant last November - “were not sufficient to secure the long-term sustainability of the organisation, which would have required a radical rework of the business model and further funding”.
According to its website, Craft Central currently houses around 100 artists, designer-makers, and creative businesses, offering both studio spaces and business development support. It has also run a Graduate Support Programme each year, offering a fully-funded studio to emerging makers, alongside self-funded residencies.
Cumulative deficits
The charity’s latest publicly-available accounts, covering financial year 2022/23 show an income of £385,266 and expenditure of £404,188, equating to a loss of £20,922.
The charity recorded a deficit of £453,000 in 2018/19, the year after moving to its current premises at The Forge, a grade-II listed building on the Isle of Dogs. The charity’s website says it undertook a “significant renovation” when moving into the building.
Craft Central recorded a loss in each of the five financial years from 2018/19 onwards, albeit a smaller loss each subsequent year.
In a report attached to its 2022/23 financial records, trustees wrote they “continue to consider the charity’s capacity to continue trading because of the effects of the pandemic as well as the cumulative deficits from recent years”.
The report says the charity received regular funding from the Foyle Foundation and the Garfield Weston Foundation to “subsidise its core costs”. In 2022/23, it received a £47,250 grant from Arts Council England to deliver a year-long programme, Flex Exchange, from May 2023.
Another key source of income was studio occupancy. The trustees said that although higher levels of occupancy at its new premises had increased revenue, it was experiencing a “high churn rate of studio holders” in 2022/23.
Trustees wrote that after fluctuating at around 90%, occupancy rate fell to around 80% at the start of 2023, which was attributed to the cost-of-living crisis. The financial report also said a number of licensees were falling into arrears.
The trustees indicated Craft Central had been forced to agree a further rent reduction with its landlord in financial year 2022/23, warning that failure to do so would have caused the company to declare insolvency by the end of February 2023.
Craft Central’s announcement makes it the latest arts organisation forced to close its doors amid financial pressures. In November, Arts Professional reported 14 former national portfolio organisations had closed since losing regular Arts Council England funding in November 2022.
In January, it was revealed the Crafts Council had made a series of redundancies as part of a restructure to deal with lower levels of income. The national portfolio organisation reported its first financial loss for four years the financial year prior.
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