A report that said Arcadia Group, behind brands including Topshop, Burton and Dorothy Perkins, is preparing to appoint administrators from Deloitte as soon as next week, could mean another headache for the commercial property sector.
Sir Philip Green’s high street empire is reportedly facing collapse, putting thousands of jobs at risk, according to Sky News.
Arcadia said: “We are aware of the recent media speculation surrounding the future of Arcadia. The forced closure of our stores for sustained periods as a result of the Covid-19 pandemic has had a material impact on trading across our businesses. As a result, the Arcadia boards have been working on a number of contingency options to secure the future of the Group’s brands. The brands continue to trade and our stores will be opening again in England and ROI as soon as the Government Covid-19 restrictions are lifted next week.”
Employees will closely monitor the story, as will landlords, of which there are a number.
Arcadia has more than 500 standalone stores, and a number of listed property companies have shops across their estates that are used by Arcadia brands. These include:
British Land (circa 20 Arcadia stores)
Capital & Regional (2 Arcadia stores)
Hammerson (15 Arcadia stores)
Landsec (10 Arcadia stores)
NewRiver (4 Arcadia stores)
These only represent a tiny part across these landlord’s wider store portfolios, but any uncertainty surrounding a tenant comes at a difficult time.
A number of retail property owners have seen rental income hit in 2020 as scores of retail and hospitality businesses have struggled to pay rent. Numerous high street businesses have suffered from lockdowns, forcing them to close sites and have less, or no, trade.
There have been a number of firms seeking a Company Voluntary Arrangement this year. It is a restructure model that firms use to seek rent cuts or shop closures.
Last year Arcadia agreed a CVA.