Third of requests to cut rent rejected
Published 02/06/2010 | 05:00
LANDLORDS have rejected a third of requests from retailers to cut rents with many claiming their businesses will fail next year otherwise.
According to the IBEC lobby group Retail Excellence Ireland, almost all retailers asked for rent reductions in the past year.
Following a survey of 187 members, a quarter said they will go bust if they do not get lower rents. Retail Excellence wants the Government to scrap existing contracts which allow rents to rise but not to fall.
Such contracts were common during the boom but are hurting retailers as the recession bites. The retail sector has had 68 insolvencies so far this year, the third highest after construction and services.
David Fitzsimons of Retail Excellence said: "There have been a significant number of retail closures this year, mainly because landlords are either refusing to consider or engage on the matter. As our rent survey results reveal, almost 100pc of respondents have now asked for a rent reduction compared with 70pc this time last year.
"Of this figure, more than 30pc of retailers have been refused a concession on rent despite sustained poor trading conditions and almost 80pc of respondents claim they require a rent reduction of more than 15pc in order just to break even."