Shop owners to give nod to Blacks deal
LANDLORDS are expected to today accept a proposal by embattled retailer Blacks Leisure that will allow it to exit leases on 89 stores in a bid to turn around its business.
Landlords, both independent and the listed real estate companies like British Land and Land Securities , are said to be “spitting blood” that they have no other option but to vote for the company voluntary administration (CVA) on the table.
They are furious that a trimmed down Blacks will get the chance to resuscitate its business from a chain of 315 stores while landlords and their shareholders pay the price.
Landlords, some of whom will sign away leases of up to 12 years, have been offered six months rent and a compensation pot of £7.25m to be shared among the 89 closed locations. The last of two pay outs won’t be made until mid-2010.
Under the plan, a further 291 stores will pay rent on a monthly instead of a quarterly basis for 18 months.
Landlords have waved through similar CVAs to ensure a future for JJB and Focus DIY but are said to be losing patience.
The Office of Fair Trading said this month it would look at the growing use of CVAs and the British Property Federation has called for urgent reform.
BPF chief executive Liz Peace said: “Landlords will do what they can to work with their tenants but there comes a point where people will demand controls and a certain level of fairness.”