Retail round up the Sunday papers
Independent on Sunday
A giant shopping centre in Ilford, Essex, has won a 20 per cent reduction in its business rates due to the threat posed by the new mega mall Westfield Stratford City. The Exchange, Ilford, has won the reduction from the Valuation Office until 31 March 2015.
Harrods has pulled the plug on its convenience store on Brompton Road and US brand National Geographic is taking it over. The shop at 102 Brompton Road, on the other side of the road to the one million square foot luxury department store, has been open since 2006 and is thought to have struggled.
Demand for supermarket property among investors has risen rapidly, and investment in the latest scheme – a Morrisons in Birmingham – is at a record level for the sector. Chase Midland Estates is developing the 105,000 sq ft store, plus eight shops, and Prupim – the property arm of M&G Group – has bought the development for one of its annuity funds. The £50m paid reflects an investment yield of below 4.5 per cent – a yield (return to the investor) last seen in the property boom pre-2008. Prupim is funding the development and will own the site on completion.
Retailers Carpetright, Sports Direct and Moss Bros are all reporting this week, ahead of the key Christmas period. The outlook is tough and the latest British Retail Consortium figures revealed UK retail sales values fell 1.6 per cent on a like-for-like basis in November. High-street sports retailer Sports Direct, eyeing struggling outdoor retailer Blacks, will reveal interim results on Thursday.
Tesco has entered the energy market and is selling boilers online and in store. Tesco, which is growing its product lines, from carpets to used cars and hairdressing, is hoping to attract customers with deals to reduce fuel bills.
Luminar, a nightclub operator, has been bought in a £45m deal that is expected save 3,000 jobs. The company, which ran Liquid, Oceana and Lava & Ignite clubs in town centres across the UK, went into administration in October with debts of £140m, of which more than £80m was owed to the banks.
Cinven, the private equity house behind Pizza Express, is assessing a £150m-plus takeover of Mothercare, the ailing mother-and-baby chain. The firm, whose previous consumer investments include Peacocks and William Hill, is believed to be looking at the retailer with a view to making a cash offer for the company. It is known that Cinven has yet to approach Mothercare's board, led by chairman Alan Parker, but is understood to be carrying out detailed work on how a possible takeover might be enacted.
Thomas Cook plans to take itself upmarket in a bid to turn its fortunes around. The troubled travel operator wants to offer a more exclusive range of holidays, from couples-only and family-friendly trips to "murder mystery" tours. The company, which has issued three profit warnings this year, has previously been accused of not differentiating its UK holiday business enough from its competitors. Management decided to overhaul the product mix after a review of the business, which will be unveiled on Wednesday when the company delivers its delayed full-year results.
People will find it easier to set up market stalls in their local high street under a proposal being considered by the government. The relaxation of licensing rules is a key recommendation in a report by Mary Portas, the retail expert and television presenter, on how to revitalise Britain’s high streets, which will be published this week.
“Pudding touts” are stripping supermarket shelves of Heston Blumenthal’s orange-filled Christmas puddings and selling them for huge profits on the internet. Charging up to 20 times the retail price, opportunists say they are netting thousands in the process.
Mail on Sunday
Home improvement retailer Wickes has opened its first High Street store, reversing a trend dating back more than two decades. For years DIY chains have concentrated on constructing ever larger sheds at the edge of towns or in retail parks. Wickes said its 700 sq ft ‘micro-store’ in Tunbridge Wells, Kent, was part of a wider strategy to enable people to order from stores, through the catalogue or via its website.
Carpetright, viewed by the City as a bellwether for the retail sector, will this week reveal its worst profits since it was listed on the Stock Exchange almost two decades ago. The chain will on Tuesday say profits in the first six months of its financial year dropped 90 per cent to a little over £1million. Carpetright, which was floated in 1993 and has 503 British stores, made less money in six months from selling carpets than it did from the sale of one of its stores last month.
Unfettered speculation by banks on the global commodities markets has contributed to a £200 increase in average family food bills this year according to anti-poverty group The World Development Movement.
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