Kendals Saved, But For How Long?
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The Kendals department store at Deansgate, Manchester, is to stay open after a new rental deal was agreed between House of Fraser owner Mike Ashley's Sports Direct and the building's Jersey-registered landlord.
CBRE advised the landlords. Bisnow approached CBRE for a statement on whether the deal represented a short-term arrangement or a long-term regearing of the lease, but has so far had no response.
The rent due on House of Fraser's former Kendals store at Deansgate, Manchester, is among the priciest facing the troubled department store group.
When the 388K SF block's owners offered the property for sale in December 2016 at a price of £84.5M, the annual rent was quoted by sales agent Savills at £4.36M with 33 years left on the lease. That amounts to a total rent liability of £135M, plus reviews.
Land Registry data shows the store at 98-116 Deansgate did not sell in 2016: the owners since 2007 are two Jersey-registered companies backed by loans from Investec Bank. They acquired the block for £75.9M. In 2012 they agreed to extend the terms of the lease with House of Fraser. Before variation the lease was 35 years from 2004.