A number of retailers look set to benefit from the failure of BHS, picking up prime sites to grow their own businesses.
Speaking to the Financial Times, Dan Simms, Head of Retail Agency at property advisers Colliers, said the likes of Primark, Next, and Sports Directs, along with discounters such as Wilko, Poundland and TK Maxx, will also be casting an eye over the 164-strong BHS estate. He added that whilst many stores were in poor condition following years of underinvestment, BHS has a number of outlets in prime retail locations in major town and cities.
Administrators called in liquidators for BHS yesterday after failing to secure a viable rescue deal for the retailer. After the chain went into administration back in April, numerous parties came forward with offers. The Portuguese-backed consortium known as the Richess Group had been the front runner in recent weeks and recent reports suggested a deal was close to being done.
However, a statement issued yesterday from the administrator Duff & Phelps said: “Despite the considerable efforts of the administrators and BHS senior management, it has not been possible to agree a sale of the business. Although multiple offers were received, none were able to complete a deal due to the working capital required to secure the future of the company.”
Reports said the administrators believed any buyer would have needed at least £100m from day one to fund working capital for the retailer, to buy stock and pay rent and salaries.
Philip Duffy, Managing Director of Duff & Phelps, commented: “The British high street is changing and in these turbulent times for retailers, BHS has fallen as another victim of the seismic shifts we are seeing.”
Hilco Retail Services, which assisted with the winding up of Woolworths, will be in charge of the liquidation process. All 163 BHS stores will hold closing down sales over the coming weeks with the aim of generating the biggest possible returns for creditors.
Staff at BHS’s head office in London started to be made redundant yesterday with a total of around 11,000 jobs to go when the business shuts its doors for the last time.
Commenting on BHS’s failure, Richard Lim, Chief Executive of Retail Economics, said: “The collapse of BHS is a devastating blow to the UK high street and all the employees involved.
“This once iconic British retailer suffered from paralysis when it came to innovation and it failed to stem the loss of market share to other more agile multi-channel competitors. The business model was simply no longer fit for purpose and its product range failed to resonate with its core customer base.
“Following the collapse of Austin Reed, these recent events focus the mind on how many other traditional UK retailers are sleep-walking into administration.”