The Body Shop closures: What do they mean for our High Streets?

We act on behalf of many clients in which negotiation over rents is required...those negotiations can often mean the difference between High Street stores being occupied or remaining empty."
Anna Smith, Commercial Surveyor, Norwich.

The Body Shop is the most recent UK retailer to announce store closures after going into administration.

The cosmetics and skincare brand, made up of company-owned stores and franchises, is now restructuring its business operations to be more financially stable.

As a result, more than half of The Body Shop’s 200-strong cohort of stores are scheduled for closure.

Then what may happen is the renegotiation of contracts with property landlords before the business is handed back to its owners, private equity firm, Aurelius. What happens next is uncertain.

It is certainly becoming more common for High Street retailers to seek early intervention by reducing footprint in low performing locations, shutting stores whilst waiting for the leases to expire. What impact does that have on the landlords of these properties?

There is an argument that landlords should provide more flexibility and allow for rent reductions and looser alienation clauses to allow tenants the ability to sub-let. However, is this realistic given their own investment criteria and is it sustainable?

We act on behalf of many clients in which negotiation over rents is required along with looking closely at the terms and conditions of leases.

Those negotiations can often mean the difference between High Street stores being occupied or remaining empty.

My view is that, of course, we should do our best to avoid Commercial property vacancies, to not only provide an income for the landlord and mitigate their business rates liability but to support the other retailers in that location.

After all, the central role of the High Street is convenience and bringing people together in one location.

If landlords are able to support their tenants in reinvigorating their brand by integrating the online and physical store experience alongside other core initiatives around sustainability, diversity and inclusion and community responsibility, the High Street may fair a little better in the years to come.

Luckily the Norwich Body Shop in Castle Street, is operated as a franchise and is understood to be continuing trading while the firm is in administration which is good news for our city.

If you need Commercial property advice or have premises to rent or a tenant looking for a unit, please contact Anna Smith in our Norwich office on 01603 629871.

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