Dunedin mall landlord plays hardball
An Australian property giant is playing hardball with tenants in a Dunedin mall, forcing some to rethink their future.
Meridian Mall, which is located in the city’s major shopping thoroughfare, is set to lose one of its largest tenants with more possibly to follow.
On Monday, Invercargill based department store chain H&J Smith announced its Dunedin Meridian Mall store may close alongside stores in Mosgiel, Balclutha and Te Anau.
Several other business owners have confirmed they were ending their arrangements with the building’s owner, Lendlease Group, an international property and infrastructure group with headquarters in Australia.
Those owners told Stuff that requests for rental relief during the nationwide Covid-19 lockdown were ignored.
‘‘The rent is massive in there,’’ one business owner, speaking on conditions of anonymity, said.
With the mall shut, and no ability to trade, he approached Lendlease seeking assistance as ‘‘we had zero money coming in’’.
But the company, via its mall manager, declined to help.
It is understood Lendlease’s stance on Meridian Mall has also been a major sticking point for two of the mall’s largest tenants: H&J Smith and Kmart.
Both stores delayed reopening under alert level 2, after the 23-year-old mall was found to have a seismic performance of less than 34 per cent of the new building standard.
While Kmart was yet to reopen, H&J Smith reopened last week, days before the announcement of a possible closure.
When asked if the company had sought rent relief from Lendlease, H&J Smith managing director Jason Smith said: ‘‘We are in discussions with the landlord at the moment.’’
It was too early to speculate on the weight those negotiations would have on the decision to potentially close the Dunedin store, he said. However, a final decision could be known as early as next week, he said.
Smith said the company was dealing with landlords who each approached the issue of rent relief in different ways.
‘‘I think it is challenging for everyone at the moment.’’
Lendlease referred requests for comment to Oyster Property Group, which manages the shopping centre.
In a statement, the company said it had written to all tenants who had requested rental relief. ‘‘We remain committed to working with tenants on a case-by-case basis regarding rental relief and are continuing to do so.’’
The company preferred not to discuss business arrangements publicly, the statement said.