Arcadia seeking significant store closures?
A report has suggested Arcadia is looking to close around a third of its 500 leased UK stores, joining the wave of UK retailers trying to downsize their store estate as online shopping continues to soar.
Senior industry figures said sir Philip Green wants to cut the size of Arcadia’s store empire “substantially”, according to Property Week.
However the group, which owns retail chains Topshop, Topman, Dorothy Perkins, Evans, Miss Selfridge, Burton and Wallis, will have to wait for hundreds of leases to expire to move forward with its downsizing plans or take a hit on early terminations.
Whilst Marks & Spencer has launched a controlled store closure programme with plans to close 100 stores by 2022, many other national chains have opted for a CVA to alleviate the financial burden of having to operate giant store estates in a time when consumers prefer to shop online.
The procedure is available to companies in financial distress to exit leases on unprofitable stores or renegotiate terms with landlords, and is becoming increasingly popular with House of Fraser, New Look, Mothercare and The Original Factory Shop all launching CVAs this year.
According to a source familiar with Arcadia’s plans, the fashion group has not yet determined how many stores it will close and there is no set timeframe for the closures, reported Property Week. However, sir Philip Green “would love to reduce the size of all the chains substantially,” the source said.
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