NCP car parks faces landlord rebellion ahead of restructuring vote
Landlords are once again in talks with the UK's largest car park provider NCP, this time threatening to remove the business from a string of premises ahead of a vote on the company's new restructuring plan.
The Telegraph reported on Sunday that the vote could tip the business into administration.
The restructuring plan would see a radical shakeup of NCP's business model, with many landlords facing large rent cuts.
Some landlords have even gone into discussion with other operators, according to The Telegraph.
In May, the car park giant described the rent cuts as "last resort", having started a process to pull out of contracts for unprofitable parking facilities as it reels from the impact of stay-at-home orders due to the coronavirus pandemic.
The company said it had seen revenues drop by 80% and the plan to restructure the business will be put to creditors at the end of May.
At the time, NCP's Japanese owner, Park 24, said it backs the plan and will cut funding if it does not succeed. NCP said this would tip it over into insolvency.
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If the plan fails 1,000 jobs hang in the balance and the future of its business looks uncertain.
The plan uses controversial new restructuring laws which could force landlords to accept changes even if they don't agree to them.
NCP said previously it has tried to negotiate deals on 500 sites it currently uses.
The move comes following a pledge by Park24, contained in Companies House documents, to support NCP for at least a year in December.
The pandemic has fundamentally altered the way we travel and shop — a fact that has wreaked havoc for high streets and in turn car parks.
Last week new figures from the British Retail Consortium (BRC) showed there are now 5,000 fewer stores on the UK’s high streets since the start of the pandemic. One in seven shops now lie vacant.
Even as restrictions lift, footfall on high streets is far below what it has been.
An NCP spokesperson said that the Board’s focus remains on securing the "best possible outcome for the business, creditors and other stakeholders through the Restructuring Plan."
"We would urge all landlords to vote in favour of the plan, which we firmly believe will result in a higher return for each class of creditor, than in the reasonable alternative, insolvency."
"If the Restructuring Plan is successful, this will enable the Company to secure new funding from its majority shareholder (£120 million facility from Park24) and improve its financial performance, whilst having rationalised its lease portfolio. We believe this should improve NCP’s covenant for its landlords.
“The categorisation of landlords into different classes is a rigorous and objective process clearly based on the operating performance, viability and strategic importance of each car park, supported by independent third-party analysis. This is a judge-led process with two court hearings covering all aspects of the Restructuring Plan to ensure a fair outcome for all landlords and creditors."
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