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Republic's future in doubt

Young fashion retailer Republic’s future is in doubt after landlords failed to agree to Mike Ashley’s demands on property terms.

Drapers’ sister title Retail Week understands that between 50-60% of landlords agreed to new terms proposed by Ashley’s Sports Direct, down on the 75% stipulated by the retailer.

In April Sports Direct, which acquired Republic out of administration in February, wrote to landlords threatening to close Republic stores unless 75% of property owners agree to new terms by 5pm on May 31.

However, sources told Retail Week that the proportion of landlords willing to agree to the new terms has fallen far short of that demanded by Sports Dircet chief executive Dave Forsey.

It is thought Sports Direct is now “weighing up its options” over the future of Republic, and could still opt to close the whole business down.

Last week it was reported that landlords remained divided over any decision. One claimed that the landlord community did not want to be “beaten around” by Ashley.

CBRE is advising Sports Direct on the process.

Both Sports Direct and CBRE declined to comment.

Readers' comments (8)

  • 50-60% should be ok. I'm sure a deal will be done.
    Would Sports Direct want to operate all of the stores anyway? Must be some that aren't worth opening the doors for (even on the percentage of sales deal) so those stores may well be some of the ones without landlord rent deal agreement.

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  • the landlords need to wake up as the rents added with rates that the landlords have in place with local councils is good 60-70% of the overheads......with the footfall dropping and etail business growing with the lower overheads ,the retailers don't have much of a choice but to close or push the supply chain for sustainability.........landlords are you willing to have empty malls???or work with the retailers and ease off the pressure you are putting on the vendors.........
    does anyone out there know if the landlords are having to pay rates on empty units/properties????simple fact the bigger can dicated but the smaller owner drivers bring the unique proposition to the consumer.......long live indys.

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  • Looking shakey at the moment I must say!

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  • While Landlords have got to change the way they do things to a degree, they should not be dictated to by any retailer. That is not the way to go about things.

    Why should landlords suffer because a business can't run itself properly?

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  • Its got nothing to do with been run properly, its a case of falling demand in certain sectors due to the squeeze every one if feeling - landlords need to wake up and smell the coffee along with the government who need to do something about rates.
    Mary's report was a waist of time, may be they should have got some one who has actually run a retail business to look at the high street not a window dresser!

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  • Disagree. Republic's shortcomings were exactly of their own making - not the landlords. If you don't like what a landlord charges, don't sign up for it. It's that simple. Don't moan in retrospect.

    Why is it when retailers have problems, they blame everyone but the themselves.

    Things are tough, no question, but in a climate such as this, it shows which businesses are being run well and which businesses are not...

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  • The guy above has clearly never run a retail business (a property agent I suspect)
    I have been involved in retail for 30 years in different companies I have owned, turnover has been static for the last 10 years along with margins (up to 2009/10) and now dropping due to the internet, rising rents, rates and badly managed service charges along with Min wage these have all taken there toll on the whole retail sector, I totally agree with the previous comments, landlords and agents became to greedy trading one retailer for another in stead of thinking long term

    oh and it does not matter what the climate is at the moment well run businesses and badly run ones will always be there no matter what the climate

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  • Creative landlords will be the ones that win in the end by supporting retailers more closely and taking a more active interest in how there properties are been used, turnover rents or profit sharing has got to be the way forward to keep units filled - landlords need to put aside valuations for the time being whilst the high street finds a level that is sustainable for every one

    a collective approach to rates would be a good start!

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