Billionaire retailers seek rent cuts during coronavirus crisis
Billionaire retailers Sir Philip Green and Mike Ashley have asked landlords for rent cuts of up to 50% as they try to cut costs during the coronavirus outbreak.
Green’s Arcadia retail empire and Ashley’s Sports Direct chain have joined a wave of retailers including H&M, New Look and Debenhams in asking landlords for rent holidays or cuts ahead of the quarterly payment day next week.
Non-food retailers are attempting to slash costs as they face slumping sales and the prospect of store closures during at least a month of lockdown as the UK attempts to clamp down on the contagious virus.
Arcadia, which owns Miss Selfridge, Evans, Dorothy Perkins and Wallis as well as Burton, Topshop and Topman, had already received rent cuts of up to 50% from its landlords under a rescue restructure completed in June last year. But the group is understood to have approached landlords this week asking for further cuts, as first reported by Sky News.
The Guardian has seen a letter from Ashley’s Frasers Group, which includes Sports Direct and House of Fraser, asking for a temporary rent cut of 50% during the pandemic and the suspension of service charges at shopping centres and retail parks. New Look has asked for a three-month holiday across its entire estate.
Debenhams wrote to landlords on Monday asking for five months rent free as it faced “unprecedented pressures” because of the pandemic. The department store, which has closed 22 stores in recent months and is set to close 48 more next year, was struggling for survival even before the virus hit.
The Swedish fashion chain H&M has also written to landlords to ask for “relief on the rents and charges”, which one UK landlord said amounted to several months rent free.
The fashion group said that sales across Europe had been “negatively impacted” by the coronavirus outbreak and that it was a “joint responsibility” with landlords and other partners to protect the future of the business. Some landlords are working closely with retailers in a mutual bid for survival.
Argent, the developer behind King’s Cross’s Coal Drops Yard in London, is reportedly looking at a three-month rent holiday for all its retail, leisure and restaurant tenants.