Yahoo Finance Debenhams asks for rent holiday as coronavirus hits the high street
Debenhams has asked landlords for a five-month rent holiday with immediate effect as the coronavirus pandemic piles “unprecedented pressures” on to the retail industry.
The struggling UK department store chain is currently undergoing a major financial restructuring process. The retailer has already closed 22 stores and is planning to shut a further 28 of its remaining 141 stores next year.
A spokesman for Debenhams told The Guardian: “All retailers are facing unprecedented pressures from the current situation and we are managing our operations to minimise risks to colleagues and customers whilst — as far as possible — trading as normal.”
Shops across the UK remain open but the number of shoppers visiting UK high streets and shopping centres in recent days has fallen dramatically as concerns over the coronavirus pandemic grow, according to data from retail research company Springboard.
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On Sunday footfall on the high street was 31% lower than at the same point last year and the visitors to shopping centres were down 21%, according to the Springboard figures.
The figures are expected to fall further as UK prime minister Boris Johnson urged people to avoid unnecessary social contact to prevent the spread of coronavirus.
Retail parks saw a smaller drop in footfall — just 6.8% compared with a year earlier — partly because they are the location of large supermarkets that have seen customers panic-buying since the coronavirus hit.
Several UK retailers are struggling to deal with the fallout from the coronavirus outbreak. The parent company of fashion chain Primark, Associated British Foods (ABF.L), said the pandemic would hurt sales across Europe.
The retailer was forced to close 72 stores across Italy, France, Spain, and Austria accounting for nearly a third of its sales in a move it said would lose the company £190m ($231m) in sales over the next four weeks.
Kingfisher (KGF.L), the owner of one of the UK DIY chain B&Q, confirmed that it was closing all of the 221 stores that it owns in France and 28 stores in Spain as it also warned of a sales hit.
Gambling group Flutter (FLTR.L), owner of Paddy Power and Betfair, warned of “unprecedented” times as it issued a profits warning after sports events around the world were cancelled or postponed.
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Annual profits are estimated to come in £90m ($110m) to £110m lower than expected if restrictions remain in place until the end of August, including a full suspension of Australian sports and the cancellation of the Euro 2020 football tournament, the company said.
