Jul 28, 2019

Primark seeks steep rent cuts from landlords

Primark is seeking steep rent cuts from landlords to compete with the growing number of high street retailers using insolvency proceedings to renegotiate leases and cut costs. The budget retailer, which does not have its own online outlet and relies on 189 bricks-and-mortar stores across the UK, has offered landlords extended leases or investment in refurbishing stores in exchange for rent cuts as large as 30 per cent. The push for rent cuts was first reported by the Sunday Times. Jonathan De Mello, head of retail consultancy at Harper Dennis Hobbs, said Primark outlets are often the anchor store in a shopping centre, making leases particularly valuable to landlords that need to provide tenants with footfall. Lease extensions in exchange for rent reductions would "Allow landlords to save face with the valuers and maintain capital values", said Mr De Mello.

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