Sweet Jesu Almighty

Yes, OK, we know he’s a bottom feeder but still, this is a hell of a price being asked:

The only major player seeking big stores is Frasers Group billionaire Mike Ashley, who is offering 15-year leases on the condition he pays no rent, business rates or service charges for the first six years.

That’s for department store buildings.

Blimey.

14 thoughts on “Sweet Jesu Almighty”

  1. At that point might as well start down the long path to convert to dwellings. Horray we can live in towns not housing parks again.

  2. Is it a big ask? After all, those charges are among the factors that helped fell department stores in the first place.

  3. That’s the value the market is putting on department stores. As no one else is bidding it’s likely to be an over generous valuation too.

  4. Why would any landlord agree to this? They pay all the expenses and Ashley gets all the income. They might as well file for bankruptcy now.

  5. Ashley sounds a better option than leasing to 15:17, whose model seems to be based on not paying its bills.

    I have thought that running a former department store as a series of pop-ups or fitting it out for independent shop units might work, but that would require councils to accept much lower business rates. They are also reluctant to allow conversion to residential, again to protect business rates.

    Having said that, it is difficult to guess where retail is going while the fucking morons in government keep everything closed. I do not believe the future is everyone staying at home to work, to order from Amazon and to drink cans in their sitting room*, but those are the only options at present.

    * I do read a depressing amount of online comments from misanthropes and autistic types who would rather spend the rest of their fucking lives indoors not talking to anyone outside their immediate family.

  6. Sounds reasonable to me.
    He’s a businessman
    He wants to pay as little as possible
    He’s made his opening gambit
    Now the other side makes a counter offer.

    Isn’t that how negotiations work?

  7. “(Councils) are also reluctant to allow conversion to residential, again to protect business rates.”

    That’s peverse, as non-domestic rates goes straight into Whitehall’s maw, but council tax goes to the local council. If I were the district treasurer I’d be banging on the door of the head of planning.

  8. Alex said:
    “And come year seven, Ashley surrenders the lease or threatens to do so.”

    Or winds up the company that signed the lease and starts again with a new one.

  9. It isn’t strictly a High Street Shopping problem then. It’s a high rent High Street landlord problem than. Good. But then the Tories. Slapping a 3% tax on on-line shopping to shore up them High Street Landlords. Or more likely to try and claw back all the Business Rate income they’ve lost. And, ‘of course’ they won’t charge BR where is should be – direct to the landlords.

  10. Where a single landlord owns most of a town centre, it can be in their interests to sign a lower lease with a so-called “anchor tenant” like John Lewis, in order to push up traffic (and hence rents) on the rest of the high street. This was always the case pre-Covid. So what sounds like a terrible deal for landlords might not be so bad overall.

    Problem is, House of Fraser isn’t really “anchor tenant” league these days. Sports Direct certainly isn’t.

  11. MC,

    “Having said that, it is difficult to guess where retail is going while the fucking morons in government keep everything closed. I do not believe the future is everyone staying at home to work, to order from Amazon and to drink cans in their sitting room*, but those are the only options at present.”

    You start by considering every type of good that people buy and whether it’s perishable, whether it has to be touched, whether people need it immediately, whether they need advice and how often they need it. And remember that we’re far more mobile than we were 30 years ago. Then you figure out how that would best be delivered, and that’s pretty much the future. We were already getting there before Covid.

    The high street was dying even before Covid. If Covid hadn’t taken down Debenhams, time would have done. 2-3 years, at best. Covid just accelerated the online shift that was coming anyway.

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