Via The Australian:
In one of the single biggest blows to the nation’s embattled retail sector billionaire Solomon Lew has announced the shock closure of all stores within his Premier Investments business, which includes popular fashion chains such as Just Jeans, Portmans, Dotti, Peter Alexander and Smiggle, with the loss of more than 9000 jobs.
Premier said it intended not to pay any rent to landlords during the shut down, triggering a possible battle with shopping centre owners.
It’s global, via Bloomie:
Major U.S. retail and restaurant chains, including Mattress Firm and Subway, are telling landlords they will withhold or slash rent in the coming months after closing stores to slow the coronavirus, according to people familiar with the situation.
In a brewing fight, chains are calling for rent reductions through lease amendments and other measures starting in April, said the people, who asked not to be named because the discussions are private.
These moves mark the next phase in virus fallout: What happens to billions in rent owed for businesses that have been closed? The stakes are high. Retail has a slew of big chains in turnaround mode. And if they do withhold payments, there would be a ripple effect. Landlords can’t afford to stop collecting rent for long, with many property owners sitting on loads of debt.
REIT rout ahead.
And what’s good for the goose is good for the gander is it not? Previously from Guy Rundle at Crikey:
The Centrelink lines are going round the block, the government has made vague announcements of rent assistance, twitter buzzes with notes from the newly laid-off wondering how they’ll put food on the table and pay the rent and the mortgage.
Here’s a suggestion. Do the former by omitting the latter.
If you have lost most or all of your income, or are about to, don’t pay your rent, don’t pay your mortgage. Write to your landlord or bank and tell them you won’t be paying for the next X months, and that you don’t regard this as a deferral, but as non-rent/non-mortgage months.
There’s a silver lining to every turd dropping from heaven, and the shining fringe around COVID-19 is that it will make it clear just how much of our economy is composed of dead value, non-productive ownership and the payment going to it: the rent.
The rent and the mortgage swallow up 30%, 40%, 50% of our incomes. They go into the maw of a property system whose prices have been ludicrously inflated by the privatisation of urban land development, land banking and the hidden inflation of a decade of quantitative easing; pumping trillions into a global economy in which neither production nor full-time jobs rose to anything like the levels intended.
So don’t pay it. Or negotiate a sharp reduction. Or negotiate a figure which covers part of the rates and part of maintenance and repair. If the landlord says they have a mortgage to pay, tell them to go on mortgage strike.
After the virus comes the revolution.