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Exclusive: River Island asks landlords for rent cuts

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 appointed the former chief executive of The White Company, Will Kernan, as its new CEO in June.

River Island declined to comment.

Readers' comments (1)

  • RI has spent a fortune on digital in the last few years. Building a large in-house team. It will be fascinating to see their 2018 annual accounts, due out end of next month.

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