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finance

JD Sports stops paying rent to landlords


JD Sports has become the latest store chain to stop paying rent to its landlords as the high street lockdown has a devastating impact on fashion retailers.

JD confirmed that it had not paid the quarterly rent for its 390 UK stores which was due last week. The retailer is understood to be in discussions with its landlords about the next bill, which is due in June.

Last week, the value fashion chain Primark refused to pay £33m in rent after the closure of its UK stores due to the coronavirus outbreak.

The Swedish fashion retailer H&M is also pushing for waivers on its rent and service charge bill.

The sportswear giant’s stores in the UK, mainland Europe and the US all shut last week. In an update to investors it warned the shutdown would have a “significant impact” on its financial outlook.

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JD Sports has been one the industry’s biggest success stories of recent years. It was promoted to the FTSE 100 in 2019 as it rode the success of the “athleisure” boom which has turned trainers and hoodies into big business. The decision to withhold rent, first reported by industry magazine Retail Week, will come as a blow to the country’s shopping centre owners who are already suffering a collapse in their rent take.

Many retailers were struggling before the coronavirus epidemic due to the combination of under weak consumer confidence, a shift to online shopping and rising costs. However the closure of all non-essential stores as part of the government response to coronavirus has left many chains facing a fight for survival with Debenhams, New Look and Topshop owner Arcadia among the retailers seeking rent holidays.

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Last week Intu Properties, the property group behind the Trafford Centre in Manchester and Lakeside in Essex, said it had received just 29% of rents due this month. Rival group Hammerson received 37% of UK rent billed for the second quarter and said it had been deluged with requests for rent deferrals, cuts or waivers after the majority of retailers were forced to close their shops.



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