Australian department store giant David Jones has fallen into administration after 188 years of trading, putting more than 6,000 jobs at risk.
The company, which operates 38 stores across Australia and New Zealand, appointed administrators from McGrathNicol on today, after last-minute negotiations with its landlords over unpaid rent broke down.
FTI Consulting has also been appointed as receiver and will oversee the retailer’s operations while options for restructuring or selling the business are explored.
The collapse follows months of financial difficulties for David Jones, which has struggled with falling consumer spending, rising operating costs and an underperforming store estate.
Its biggest landlord, Scentre Group, which operates Westfield shopping centres across Australia and New Zealand, said David Jones had failed to pay rent since the end of September.
Scentre Group chief executive Elliott Rusanow said the property group had offered a rescue proposal to the retailer’s owner, Anchorage Capital Partners, but that the offer had been rejected.
David Jones, which was acquired by private equity firm Anchorage Capital Partners in 2023, had been seeking to renegotiate rental agreements and significantly reduce its store portfolio as part of a turnaround plan.
All physical stores and online operations will continue trading while the receivers review the business, although store closures and job losses are expected as part of the restructuring.
David Jones chief executive Erica Berchtold said: “We have a well-developed plan on how to reset the business for the future and will be working with the administrators, the receivers and our secured lender as we continue to pursue that reset of the business.”
FTI Consulting’s Christopher Hill said the administration would give the business an opportunity to restructure after facing mounting pressures from rising costs, supply chain challenges and its extensive store footprint.
“Voluntary administration and receivership provides breathing space and an opportunity to restructure the business,” he said.
A process to seek potential buyers or new investment in the business will begin immediately.
Founded in Sydney in 1838, David Jones is one of Australia’s most recognisable retail brands and describes itself as the world’s oldest continuously operating department store.
Its collapse comes just weeks before the crucial Christmas trading period, adding to growing pressure on traditional department store operators as they battle competition from online retailers and changing shopping habits.
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