Mike Ashley’s Frasers Group to withhold rents for the foreseeable future
Mike Ashley’s Frasers Group to withhold rents until trading “reaches a level” envisaged.
According to a letter seen by Estates Gazette, Sports Direct owner Frasers Group has told landlords that it intends to withhold rent payments on its stores until the group is “fully able to trade as a business” at affected locations.
The Estates Gazette report states that Frasers Group said it aims to go rent-free until trading “reaches a level” which all parties would have “envisaged” when leases were initially drawn up.
Frasers said that since its stores had not been able to trade under lockdown restrictions, it imagined that landlords would have made an “obvious provision” of suspending obligations to pay rent until it is “once again able to use, occupy and enjoy the property, in full.”
Furthermore, according to the report, the letter said: “A tenancy of a property which could not be used for trading was not the deal we made as tenant. The whole purpose was for us to be able to trade.”
Frasers Group had previously approached landlords back in March for a temporary 50% waiver on rents for its stores, as well as asking to change future rental payments to a monthly cycle to improve cashflow.