Debenhams to close five stores after dispute with landlord Hammerson
Debenhams has announced it will permanently close five stores in Hammerson shopping centres after it was unable to reach an agreement with the landlord, with Next swooping in to rent some of the vacant space.
The department store chain will shut its stores at Hammerson’s Birmingham Bullring, Leicester, Reading, Croydon and Glasgow Silverburn sites, affecting 1,000 jobs,
Next said today that it will take over the vacant department stores’ beauty halls.
However, Hammersons shares were down more than seven per cent this morning following the loss of a flagship tenant during the coronavirus crisis, which has battered the retail sector.
It is a further blow to the retail landlord after a deal to sell seven retail parks to private equity firm Orion for £400m collapsed this week after the buyer pulled out.
A Debenhams spokesperson said: “We can confirm that despite our best efforts, we have been unable to agree terms with Hammerson on our five stores in its shopping centres, and so they will not be reopening.”
Debenhams, which entered administration earlier last month for the second time in a year, had already announced the closure of seven stores, including the Shepherd’s Bush Westfield branch, affecting 422 jobs.
Next, which sells brands such as Estee Lauder, Clinique, and Nars online, said it expected to hire many former Debenhams employees to run the new venture, which will trade as “The Beauty Hall from Next”.
Next chief executive Simon Wolfson said: “This is an exciting opportunity to work with existing and new beauty brand partners to create a new force in beauty retailing – bringing our online business to life through premium store environments in some of the UK’smost important retail locations.”
Hammerson chief executive David Atkins added: “This is a really challenging time for all of us, so it’s really encouraging to see strong, innovative brands like Next work with us to plan for the future.”