Focus seeks new rent deal in bid to survive

The DIY chain chairman is visiting all its landlords to ask them not to demand quarterly payments

Focus, the DIY chain, is negotiating with its landlords for an extension of rent payments in order to survive.

The group, which has 178 stores and employs 3,700 people around the country, wants to continue to pay rent on a monthly basis rather than for three months at a time. Focus has been struggling for several years but a recent sharp downturn in trading has deepened the crisis.

Bill Grimsey, the Focus chairman, is visiting more than 100 landlords to ask for an extension to an agreement that was put in place in August 2009 as part of its company voluntary arrangement (CVA) which also saw the closure of 38 stores. The agreement, which was for monthly rent, is due to end in March.

Private equity group Cerberus, which owns Focus, hired Lazards to advise on the future of the business at the end of last year.Harvey Spack Field is advising on rent negotiations.

Mr Grimsey said talks with landlords have been positive so far and he is hopeful of reaching agreements with most of them to extend the monthly payments for at least the rest of this year.

"We are having to grapple with the difficult conditions we currently face and we are asking our stakeholders – our landlords to help with this," he said on Friday. He pointed to the recent announcements by rivals B&Q and Homebase which both highlighted that 2011 is predicted to be a tough year for DIY and the retail sector as a whole.

The news comes as the poor Christmas sales took their toll on two retailers this month.

Young fashion chain Krisp, which has 32 shops in the UK, has been placed in administration and, on Friday, HPJ Jewellers, with around 70 stores, also filed for administration.

The jewellery chain was bought by restructuring specialist Gordon Brothers in December and KPMG has now been hired as administrator. It is proposing a "rescue plan" that would see it shrink to around 35 shops.

The administrations of Krisp and HPJ follows British Bookshops & Stationers – the first retailer to file for administration in 2011.

Tim Leatham, the director of shopping-centre management at Savills, which collects rental payments from retailers, said: "The next three months will be crucial for retailers. They will face rising inflation and unemployment, public sector spending cuts, the VAT rise and potential interest rate rises. And they will soon be faced with the March rent quarter day.

"Valentines day will be an important time for retailers and with a longer gap until Easter, we can expect continued caution with some retailers considering rationalisation options in order to focus on their stronger performing stores."

This week, Deloitte estimated that around £750m of retail spend was lost as a result of the snow in the weeks up to Christmas.

Catherine Lambert, a retail expert at the commercial property adviser Jones Lang LaSalle, said: "Although some research has suggested that vacancy levels at shopping centres have fallen recently the actual number of retailers that have declared intentions of closures means there is still a huge cause for concern.

"Unless you are a destination shopping centre or a convenience centre, where demand is still holding up, there are plenty of problems on the horizon."

Start your day with The Independent, sign up for daily news emails
News
i100
News
Bobbi Kristina Brown, daughter of the late singer Whitney Houston, poses at the premiere of
people
News
people
News
The frequency with which we lie and our ability to get away with it both increase to young adulthood then decline with age, possibly because of changes that occur in the brain
scienceRoger Dobson knows the true story, from Pinocchio to Pollard
Voices
The male menopause: those affected can suffer hot flushes, night sweats, joint pain, low libido, depression and an increase in body fat, among other symptoms
voicesSo the male menopause is real, they say, but what would the Victorians, 'old' at 30, think of that, asks DJ Taylor
Life and Style
health
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: DBA Developer - SQL Server

£30000 - £35000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Customer Service Administrator

£13000 - £15000 per annum: Recruitment Genius: Are you passionate about custom...

Recruitment Genius: Dialler Administrator

£22000 - £25000 per annum: Recruitment Genius: Main purpose: Under the directi...

Ashdown Group: Contracts Manager - City of London

£35000 - £37000 per annum + benefits : Ashdown Group: Contracts Manager - City...

Day In a Page

Turkey-Kurdish conflict: Obama's deal with Ankara is a betrayal of Syrian Kurds and may not even weaken Isis

US betrayal of old ally brings limited reward

Since the accord, the Turks have only waged war on Kurds while no US bomber has used Incirlik airbase, says Patrick Cockburn
VIPs gather for opening of second Suez Canal - but doubts linger over security

'A gift from Egypt to the rest of the world'

VIPs gather for opening of second Suez Canal - but is it really needed?
Jeremy Corbyn dresses abysmally. That's a great thing because it's genuine

Jeremy Corbyn dresses abysmally. That's a great thing because it's genuine

Fashion editor, Alexander Fury, applauds a man who clearly has more important things on his mind
The male menopause and intimations of mortality

Aches, pains and an inkling of mortality

So the male menopause is real, they say, but what would the Victorians, 'old' at 30, think of that, asks DJ Taylor
Man Booker Prize 2015: Anna Smaill - How can I possibly be on the list with these writers I have idolised?

'How can I possibly be on the list with these writers I have idolised?'

Man Booker Prize nominee Anna Smaill on the rise of Kiwi lit
Bettany Hughes interview: The historian on how Socrates would have solved Greece's problems

Bettany Hughes interview

The historian on how Socrates would have solved Greece's problems
Art of the state: Pyongyang propaganda posters to be exhibited in China

Art of the state

Pyongyang propaganda posters to be exhibited in China
Mildreds and Vanilla Black have given vegetarian food a makeover in new cookbooks

Vegetarian food gets a makeover

Long-time vegetarian Holly Williams tries to recreate some of the inventive recipes in Mildreds and Vanilla Black's new cookbooks
The haunting of Shirley Jackson: Was the gothic author's life really as bleak as her fiction?

The haunting of Shirley Jackson

Was the gothic author's life really as bleak as her fiction?
Bill Granger recipes: Heading off on holiday? Try out our chef's seaside-inspired dishes...

Bill Granger's seaside-inspired recipes

These dishes are so easy to make, our chef is almost embarrassed to call them recipes
Ashes 2015: Tourists are limp, leaderless and distinctly UnAustralian

Tourists are limp, leaderless and distinctly UnAustralian

A woefully out-of-form Michael Clarke embodies his team's fragile Ashes campaign, says Michael Calvin
Blairites be warned, this could be the moment Labour turns into Syriza

Andrew Grice: Inside Westminster

Blairites be warned, this could be the moment Labour turns into Syriza
HMS Victory: The mystery of Britain's worst naval disaster is finally solved - 271 years later

The mystery of Britain's worst naval disaster is finally solved - 271 years later

Exclusive: David Keys reveals the research that finally explains why HMS Victory went down with the loss of 1,100 lives
Survivors of the Nagasaki atomic bomb attack: Japan must not abandon its post-war pacifism

'I saw people so injured you couldn't tell if they were dead or alive'

Nagasaki survivors on why Japan must not abandon its post-war pacifism
Jon Stewart: The voice of Democrats who felt Obama had failed to deliver on his 'Yes We Can' slogan, and the voter he tried hardest to keep onside

The voter Obama tried hardest to keep onside

Outgoing The Daily Show host, Jon Stewart, became the voice of Democrats who felt the President had failed to deliver on his ‘Yes We Can’ slogan. Tim Walker charts the ups and downs of their 10-year relationship on screen