The owners of Dublin’s Jervis Shopping Centre are suing two more retail tenants as disputes over unpaid rents intensify. Court records show that JSC Properties Ltd issued High Court proceedings against fashion chains Schuh and New Look, each of which occupies a store in the city-centre complex.
New Look’s 30,000sq.ft. store there was the UK-based chain’s largest in the world when it opened ten years ago. It is currently closed until further notice. Legal proceedings are against the group’s Irish subsidiary New Look Retailers (Ireland) Ltd, whose latest annual accounts to the end of March 2019 showed improved trade and profitability.
At the time, the company reported an operating profit of €4.1 million, reversing a corresponding loss of €6.8 million the year before. Adjusted Ebitda flipped from a €2 million negative position in 2018 to a €2 million gain last year. Directors reported that key indicators such as footfall and conversion rates were improving. It grew its net asset value to €34.3 million on March 30, 2019.
Its UK parent, privately-held New Look Retail Group Ltd, also reported improving profitability last year in Ebitda terms but posted a loss of £522.2 million including a “£423.3m goodwill and brand impairment charge” as it restructured its corporate and financial footprint and closed dozens of stores. New Look Retail Group Ltd was subsequently placed in liquidation last year as part of the group restructure.
Crucially, it secured a so-called company voluntary agreement (CVA) with its British landlords, through which the company reported having “successfully addressed [the] over-rented position of UK store estate”. British media reports this week suggest that New Look is about to launch a second CVA insolvency procedure there.
New Look signed a 20-year lease for its Jervis store in 2010 and its annual rent was €1.3 million as of 2014.
The Schuh store in Jervis Shopping Centre is one of ten in the Republic operated by Schuh (Roi) Ltd, which is the target of the landlord’s court action. The company last filed accounts for the year ended February 3, 2018, which showed increasing profitability over stable sales of just over €30 million.
The company, which had €4.8 million in reserves at the time, is owned by US-based listed shoe retail group Genesco. The group operates in North America, the UK and Ireland and reported slipping into the red during the quarter ending on May 2 this year, after Covid-19 closures saw sales plunge by 44 per cent.
The 25-year lease for Schuh’s Jervis shop was among the first signed by the chain immediately after its establishment in Ireland at the end of 1997. Its annual lease was €270,000 in 2014.
Legal proceedings against New Look and Shuch were filed on Tuesday by Dublin law firm Ivor Fitzpatrick & Co on behalf of JSC Properties Ltd, just like those against TopShop and Fields Jewelers the previous day. JSC Properties, which owns the Jervis Shopping Centre, is an Isle of Man-registered company whose directors are developer Paddy McKillen and local agents.
JSC Properties is planning a major redevelopment of the shopping centre, including the demolition of some retail and car parking space to make way for 127 co-living units, 24 rental apartments and a three-storey rooftop extension accommodating office space. Additional parking and 390 bicycle storage spaces are also included.
The planning application was lodged in March by JSC Properties as freehold owner, alongside two companies expected to lease part of the project, whose directors are existing business associates of McKillen and of his co-investor in the shopping centre, Northern Ireland-based Padraig Drayne.
Last month, Dublin City Council request further information on the project and expressed concerns at the loss of retail space on Mary St, “the overall residential quality” of the proposed co-living units and apartments, the provision of additional parking when policy is to discourage commuter car parking, and the potential impact of the project on future development options for Marks and Spencer’s store next door.
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