Mike Ashley demands landlords link rent to sales
Retail tycoon Mike Ashley, the founder of Sports Direct, has demanded that new rent deals are tied to sales across his high street empire.
Ashley has reportedly asked landlords to agree to turnover rents, where up to 15 per cent of the rent payable is linked to in-store sales.
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The leasing structure allows struggling retailers to share some of the risk – and reward – of operating from the premises with its landlord. It was reported in June that H&M demanded that landlord accept turnover-based rents for lease renewals and new stores.
The retail billionaire, whose portfolio also includes House of Fraser and Flannels, has more than 700 stores across the UK.
He has previously hit out at “greedy” landlords and said they should do more to save the UK high street.
Ashley’s demand to landlords, reported by the Sunday Times, comes as struggling retailers attempt to stay afloat in the increasingly challenging high street environment.
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A number of retailers have decided to pursue company voluntary arrangements over the past few months, including Sir Philip Green’s Arcadia, which owns Topshop and Dorothy Perkins, Monsoon Accessorize and card shop Clintons.
Property companies have been adversely affected by the string of restructuring agreements. British Land last week wrote down the value of its retail portfolio by 10.7 per cent, while Landsec swung to a pre-tax loss of £147m.