RETAILERS struggling for survival could be toppled into administration when their quarterly rent bill becomes due tomorrow.
Troubled traders will have to fork out large lump sum payments to their landlords at a time when they are already facing weak consumer conditions, rising costs and credit difficulties, an expert warned.
Several retailers hit the rocks around the last rental demand on Boxing Day and it is feared many more firms could crumple under the pressure this time.
JJB Sports is thought to be among the familiar high street names facing a crucial tipping point as the deadline looms. The firm is bidding to sell its fitness clubs business before “Quarter Day” when the company’s multi-million pound rent bill is due.
Jonathan de Mello, director of retail consultancy at Experian, said traders’ last rental bill was during the Christmas period, when customers hit the shops looking for presents.
But the trading climate had become much more difficult in the first three months of the year as the economic crisis caused shoppers to slash spending.
“Given the feel-bad factor in the economy, I think it is going to be a very difficult time in the retail sector and we are going to see a lot more administrations,” he said.
Landlords that insist on forcing tenants to adhere to rental payments agreed to in the good times could push some retailers over the edge, said Mr De Mello, creating “big vacancies” on the high street.
Experian predicted the number of empty shops across the UK could rise to 135,000 by the end of the year – a record rate of 15% of the total retail estate.
But he said larger landlords like British Land, owner of Meadowhall at Sheffield, and Land Securities, owner of the White Rose centre near Leeds, had moved to accommodate retailers.