House of Fraser at intu Lakeside to close

Irving Hamilton
November 15, 2018

The operator of Chapelfield shopping centre, where the shop is based, said it could not come to a deal with the chain's new owner Sports Direct.

Intu Properties, now the subject of possible takeover interest, said in response: "We have been advised this morning that the four House of Fraser stores in our portfolio will be closing in early 2019, representing around 1% of our secured rent and 526,000 sq ft of retail space".

Other stores facing closure are at Intu sites at Lakeside in Essex, the Metrocentre in Newcastle, and the Victoria Centre in Nottingham, according to Sports Direct.

Mike Ashley, the boss of House of Fraser's parent company Sports Direct, issued a stark warning to landlords over the need to cut rent levels after announcing that all four stores owned by Intu Properties faced closure as a result of a failure to agree new terms.

Sports Direct, controlled by retail tycoon Mike Ashley, snapped up the 58-store House of Fraser for £90m in August after it collapsed into administration.

Chief executive Mr Ashley said: "We had multiple meetings with Intu, but we were no further forward after 14 weeks".

Business editor Mark Shields explains why House of Fraser is closing its store in Norwich's Chapelfield shopping centre.

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"Despite our best efforts we have been unable to agree reasonable terms for these stores to continue trading".

"We hope other institutional landlords will continue to work with us in order to save stores and jobs".

The high street has endured a brutal 2018 - with Toys R Us and Maplin the first casualties while a string of other big names have been forced to seek rescue deals with landlords.

It comes on the same day as Intu pushed back the deadline for a second time on its talks with a consortium of buyers looking to take over the business. On Wednesday morning the company said it had given the bidder, led by Intu's deputy chairman John Whittaker with backing from Saudi and USA investors, extra time to make a firm offer.

Following the purchase, Mr Ashley said he was hopeful that most of the department store chain's 59 sites would remain open.

In September, when he announced the closure of the Edinburgh, Hull and Swindon stores, he blamed "greedy" landlords, who refused to be "reasonable", for the shutdowns.

Intu has been contacted for comment.

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