US young fashion retailer Forever 21 has agreed to come out of its 20,000 sq ft store at Intu Trafford Centre in Manchester and is looking to exit its 35,000 sq ft store at Intu Lakeside shopping centre in Essex, as part of a strategy to downsize its UK property portfolio.
Drapers understands the Trafford Centre unit will be occupied by Zara or another Inditex brand.
Forever 21 is also expected to downsize its 50,000 sq ft Dublin store and its 20,000 sq ft store in Bluewater, Kent.
“The stores aren’t performing as well as they should and some are overspaced,” said a source. “But [Forever 21] has agreed to take new stores in the Netherlands and Germany, and has around 25 stores in mainland Europe.”
Forever 21 first launched in the UK in 2010 and has stores at Oxford Street in London, Birmingham Bullring, Buchanan Street in Glasgow, Church Street in Liverpool, Westfield Stratford, which are thought to be unaffected by the plans.
In its latest accounts filed at Companies House, Forever 21’s UK arm increased turnover from £37.1m to £48.3m for the year to February 28, 2014, but made a pre-tax loss £18.4m, down from £66.5m the previous year.
In the US, the retailer is reported to be scaling back some of its largest stores such as a 100,000 sq ft unit in Tacoma in Washington as it struggles to generate the required sales per square foot in some of its biggest stores due to the chain’s low prices. Despite this, the retailer is expected to add to its US store footprint, adding 100 stores to its 720-store portfolio.
Forever 21 is represented in the UK by James Ebel, executive director at property advisor Harper Dennis Hobbs, who was unavailable for comment. Forever 21 has not yet responded to Drapers’ request for comment.