In April, the government drastically reduced to the maximum stake on fixed-odds betting terminals from £100 to £2. Whilst protecting gambling addicts is undeniably good, the law of unintended consequences means the decision has had a knock-on effect on the wider economy.
Just 3 months later, William Hill has announced plans for 700 store closures, putting around 4,500 jobs at risk. Evidently traditional gambling has moved on-line and the physical betting shops had become dependent on these casino type fixed-odds betting machines. This suggests the other high street bookmakers will shortly follow suit with their own flurry of store closures.
In an era of struggling high streets, the mainstays in some towns had become Pound shops, bookmakers and charity shops. The bookmakers’ exit will not help.
Where a unit remains vacant for more than 3 months, the Landlord becomes liable to pay the business rates. Since charity shops as are exempt from business rates, a landlord will often allow them to occupy vacant unit……. rent free.
In the absence of an unlikely rejuvenation of the bricks and mortar element of the retail sector, it appears the flow of major retailers re-negotiating their rents via CVAs will continue. The future does not look good for landlords.
Most retail properties are owned by pension funds, the lost rents will therefore be felt throughout the population via lower fund growth rates. However, some premises are owned by smaller corporate landlords and individuals. These landlords will find their bottom line deteriorating or even turning red especially where the properties have been mortgaged.
If you are a landlord concerned about the viability of your business, it is vital that you take professional advice as soon as possible. Call Lynn Gibson on 01932 336149 to arrange a free initial meeting where we can discuss and advise on your options.