Expert Comments As September Deadline Approaches

The upcoming rent quarter day at the end of this week is expected to be another difficult one for many in the retail sector, according to a corporate recovery expert at Irwin Mitchell.

Retailers will be bracing themselves over the coming days as they are expected to meet their next quarterly rent payments - their last before the festive period – on September 29th.

The deadline has come around as conditions in the sector remain very sensitive, with further major companies falling victim to the economic climate and other factors. One of the most notable in recent days has been JJB Sports, which has confirmed plans to call in administrators.

According to Chris Jones, a lawyer who specialises in insolvency and corporate recovery at Irwin Mitchell’s Manchester office, it may not be a great surprise to see further casualties emerge in the coming days and weeks.

He outlined: “Even though the ongoing problems in the economic climate mean many retailers have already made a move to switch to different payment arrangements, the past year has shown that this traditional deadline remains in place for a huge number or companies.

“While many companies which have managed to battle through the difficult conditions of the past few years so far, the problems seen at JJB are a sign that retailers which have been relatively robust up to now may still be under threat.”

The expert added that any companies which do have financial concerns going into the end of this week should raise their issues as soon as possible.

He said: “Speaking to a landlord should not be viewed as a daunting task, as working together may ensure that measures can be put in place that suit both parties.

“For example, landlords are unlikely to have too many people waiting to take space, so may be happy to discuss options such as payment holidays or even reduced rents in order to retain their tenants and keep occupancy rates ticking over at a relatively high level.

“We would however urge that retailers raise this issue whenever they can, as waiting until well into the 21-day payment period may only complicate issues for everyone involved.”