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Tuesday 28 March 2017

New deal on 'rents' for shops opening in Terminal 2

John Spain and Breda Heffernan

RETAILERS at Dublin Airport's new Terminal 2 won't have to pay an annual rent but will instead share the risk with the airport authority through a "concession fee".

The deal will come too late for bookseller Hughes and Hughes which blamed high rents for its collapse earlier this year. The chain, which had concessions at Dublin and Cork airports, said its business had been hit by falling passenger numbers and it was unable to renegotiate rents.

However, its former rival, British books giant WH Smith, will fare better under the terms of its contract at T2, which is due to open in November.

Along with giftware specialists House of Ireland, Irish fashion group Azure, Swiss jewellery retailer Swatch and cosmetics company Jo Malone, WH Smith will benefit from a new contract that means companies based in T2 will pay a concession fee based on a percentage of annual sales rather than a fixed annual rent.

Explaining the new departure, Paul Neeson, retail director for the Dublin Airport Authority, said: "This allows the DAA and its retail partners effectively to share the risk, as, unlike traditional landlords, we do not charge additional annual rent."

Up to 400 jobs are expected to be created at the new terminal which will have around 40 retail units including shops, restaurants and bars. The majority of these will be run by outside firms with a handful to be retained by the DAA for sales of perfume, cosmetics, alcohol and tobacco.

Meanwhile, some Irish publishers have expressed alarm at the awarding of the book retail contract to WH Smith saying the British firm won't prioritise Irish works.

"The trouble with this is that a big operation like WH Smith is centralised in the UK. All the WH Smith ordering and distribution is done from there and that will put Irish publishers at a disadvantage," said one publisher.

Publishers

"On top of that they don't know much about Irish books. They might know Dan Brown, but do they know who Ross O'Carroll-Kelly is? I don't think so."

He pointed out that WH Smith already had the contract for Shannon Airport and the experience there for Irish publishers during the past couple of years had been "very poor".

"They just don't stock enough Irish books there. But Shannon is not nearly as important as T2 where the potential for business is much greater," he added.

The DAA said that, as part of the tendering process, all bidders were asked to commit 20pc of their overall book range to Irish titles and that WH Smith had agreed to honour this.

However, publishers said yesterday this commitment was meaningless unless it was enforced.

Irish Independent

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