Yahoo Finance Landlords look at options for Debenhams stores, as chain prepares to say goodbye to UK high streets
Debenhams stores in the UK are closing
(PA Wire)It will be a heartbreaking month for Debenhams employees as the department store chain closes all of its remaining stores in the UK, and a list has now been published of when exactly the last sites will shut.
The retailer is among businesses that suffered from temporary store closures during the pandemic and increasing online competition. In December 2020 it emerged that administrators FRP Advisory had concluded they should commence a wind-down of Debenhams UK.
The department store group will close its doors on the high street for the final time in its 242 year history this month, with the final closures on May 15.
A spokesperson for Debenhams said: “Our sincere thanks go out to all of our colleagues and customers who have joined us on this journey. We hope to see you all one last time in stores before we say a final goodbye to the UK high street.”
The closures leave a host of building owners with vacant sites, many of which are large. Peter Mace, head of central London retail at property agent Cushman & Wakefield, says: “Empty stores are not good news for landlords especially in the current retail climate.”
Difficulties some commercial property landlords have been facing during the virus crisis include less income, as tenants struggle to pay rent due to lockdowns, declining retail property values, and weaker demand from occupiers for space in some areas.
Among options landlords could look at for the Debenhams sites are getting in a new retail tenant, introducing a new type of occupier, carving up space to create smaller units, or changing the use of the store.
London listed landlords that have one or more Debenhams shops within their portfolio, include: British Land (six), Landsec (two), Capital & Regional (three) Hammerson (two).
Looking at some of those sites, Landsec has one in the White Rose shopping centre in Leeds. At the Wandsworth branch, that closed early last year, a letting was agreed in January 2021 for Gravity Active Entertainment to take 80,000 square feet over four floors.
David Heaford, managing director of development at Landsec, says when the site at Southside shopping centre opens this summer it will feature gaming experiences such as e-karting, augmented reality bowling, crazy golf, pool, ping-pong, and shuffleboards. There will also be dining and drinking options.
“It’s an innovative example of how we are rethinking our retail centres by blending Southside’s existing offer with leisure to draw more people from across the capital to south west London,” says Heaford.
Hammerson, which has previously repurposed three existing Debenhams sites, with build to rent homes planned at one, now has two remaining Debenhams it will explore options for. Those are at the Bullring, Birmingham and Silverburn, Glasgow.
Capital & Regional said in a trading update last month: “We are continuing to see demand for this [Debenhams] space with strong interest on all three stores.”
Ted Schama, co-managing director of Shelley Sandzer, a leisure leasing agent, says: “Destinations need to have anchors to attract visitors and create points of difference. While that may have been department stores traditionally, times have changed. Consumers want greater variety of offer and experience than ever before.”
Schama’s firm has helped secure new premises for a number of companies, including fitness brands, that still see the benefits of having bases in town centres and on high streets.
The soon to be vacant sites could create opportunities for some new entrants and existing firms that want to be able to make the most of higher footfall and improved consumer confidence as lockdowns ease. But, not all landlords will find a waiting list of occupiers wanting to move in.
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