River Island is asking landlords to slash store rents by up to 40%, Drapers can reveal.
The retailer, which operates 270 stores across the UK and Ireland, is proposing a move to reduce rents across the majority of its portfolio, according to industry sources.
The retailer is understood to be negotiating turnover-only rent deals of up to 12% in its stores in marginal locations.
One source close to the situation told Drapers “this is a very normal process for the business”.
One property source said: “I don’t think River Island stands out as a company on peoples’ watch list because of levels of trade. Everyone is getting discounts [because of company voluntary arrangements].”
In its most recent results, River Island’s operating profit for the year to 30 December 2017 fell by 40% to £80.6m as it invested in its digital capabilities amid a “challenging backdrop for retail”. Turnover for the year to 30 December fell 2.3% year on year to £944.5m, and River Island said its outlook remained cautious.
River Island declined to comment.