Hotel Chocolat CEO Angus Thirlwell seeks rent cuts

Hotel Chocolat CEO calls for rent cuts to match CVAs
Hotel Chocolat is renegotiating rent rates in wake of rise of CVAs.
// Hotel Chocolat co-founder says retailers shouldn’t be “penalised for being successful”
// Retailer is now negotiating CVA clauses if a near-neighbour achieves a reduction in rent
// Angus Thirlwell adds that focus is now on expansion in stores with turnover rents system

Hotel Chocolat co-founder and chief executive Angus Thirlwell reportedly said he is sick of being “penalised for being successful”.

Thirlwell called for clauses in rent renegotiations to match any rent cuts pushed through by rivals via CVAs, PA reported.

READ MORE: Over 140,000 jobs have been lost this year

The retail boss argued that other retailers are being “penalised for being successful” by effectively subsidising rent cuts for others, and called for “fairness” from landlords.

“We didn’t think it was right that this was happening – businesses shouldn’t be penalised for being successful. We are growing and want to continue opening in new locations but in a long-term sustainable, careful and measured way,” Thirlwell told PA.

Hotel Chocolate has 127 stores in the UK and posted an 11 per cent rise in pre-tax profit for the full year to June 30 2019.

The results were driven by a 14 per cent rise in revenue to £132.5 million.

In renegotiations with landlords over rent, the business has started calling for clauses that add if a near-neighbour goes through a CVA process and negotiates a cut in rent, Hotel Chocolat should too.

Research revealed earlier this week by the Centre for Retail Research (CRR) found a total of 38,100 of the jobs lost this year were down to retailers filing for administration, with Mothercare and Bonmarche among the casualties of 2019.

Another 26,500 roles were shed through CVAs, with Sir Philip Green’s Arcadia Group and Debenhams among the firms to shed loss-making stores.

Hotel Chocolat added it will be focusing its attentions on new stores in train stations, airports and other sites that operate a turnover rents system where an agreed percentage of a store’s takings is handed over in lieu of rent.

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  1. Turnover rents do provide certainty for an occupier, but can be tricky beasts when valuing retail investment properties.

    • A less tricky beast for a shopping centre landlord than dealing with the investment value of the entire scheme filled with post-CVA retailers only paying business rates and service charge but no rent.

  2. If this company is so successful than why the quibble about paying rent ? What’s next -dodging tax ? Sounds like greed to me

    • Well, it sounds like fairness and nothing whatsoever like greed to me.
      Why should their successful business subsidise other failed retailers and landlords of shopping centres, who’ve got broken business models?
      Neither are charities or causes for social good.


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