Fear hangs over towns and cities as Debenhams faces huge bills
Robert Dalling and Ryan O’Neill outline dangers facing several shopping centres as the High Street giant issues a ‘time is running out’ warning...
FEARS are growing for Welsh towns and cities which rely heavily on their Debenhams store to help pull in shoppers.
The high-street chain has warned that hundreds of jobs could be lost unless the Welsh Government grants a business rates relief holiday, adding “time is running out” to save its four largest Welsh stores.
The UK chancellor, Rishi Sunak, previously granted a year-long rates holiday to all retail, leisure and hospitality firms.
Wales said it would match the pledge but then changed the threshold so that large firms could not benefit. It means Debenhams faces paying huge sums for shuttered stores.
It said its stores in Cardiff, Newport, Swansea and Llandudno were still at risk of closure. The rates on the four stores total £2.5m per year, with Cardiff accounting for £1.1m. Now, business leaders and authorities have spoken out over the current uncertainty surrounding the stores’ future.
Debenhams has been located right in the middle of the Quadrant Shopping Centre in Swansea for generations. Chief executive of Swansea BID (Business Improvement District), Russell Greenslade said, “there is a lot of important work” currently going on behind the scenes to support anchor stores in Swansea city centre.
He said: “Swansea BID is very much a part of this conversation, with Swansea Council and ministers looking very carefully at the situation in these difficult times. It is vital that the Welsh Government and the UK Government play an active role in this process too.
“Swansea has a bright future, with over half a billion pounds worth of investment going into redevelop our city in ways that will be long-lasting and economically advantageous.
“We are seeing our independent businesses as well as our big name brands stepping up to continue to provide vital services to consumers in light of the current COVID-19 crisis. This entrepreneurial spirit will see Swansea thrive into the future.”
Swansea Council leader Rob Stewart said efforts had been made by the authority to put a strong case forward to support the store.
“In terms of Debenhams we have engaged with Welsh Government ministers and have made a strong case for support for anchor stores like Debenhams, and this is under active consideration by ministers,” he said.
“We have made it clear that we will do what we can locally to support businesses during this period, but help from Welsh and UK government is essential.
“We believe the Swansea store is one of their best trading locations and we hope that a support plan can be agreed to allow Debenhams to continue to trade in Swansea and elsewhere.”
The arrival of Debenhams in Newport’s Friars Walk shopping centre was met with much fanfare in 2015.
Spread across 93,000 square feet of space, the store was seen as pivotal in Newport City Council’s efforts to regenerate Newport’s high street.
The store escaped the cull last year when Debenhams announced that up to 22 stores worldwide would close, but faces major uncertainty over whether or not it will reopen post-coronavirus.
Conservative Newport councillor Matthew Evans said the store’s closure would have a “devastating impact” on the city.
“When I was council leader we had several unsuccessful attempts to get Debenhams to move to Newport, so when we finally persuaded them it literally enabled the Friars Walk development to go ahead.
“Without Debenhams, the whole city centre redevelopment would have never happened.
“Clearly it would have a devastating impact on the city centre, not just on other retail units but also on the restaurants, food halls, and the cinemas and leisure facilities within Friars Walk. It’s more than just the one business.”
Cllr Evans said he was “amazed” at the decision to cap business relief and had written to Welsh Finance Minister Rebecca Evans on Friday appealing for its reversal.
“The reality is that many SMEs rely on big businesses. Between the people they supply, delivery companies, IT etc, you can’t ignore the employment that big companies provide.
“As far as Newport goes, it has been struggling, and this will adversely affect us again.”
Cllr Evans added that the loss of Debenhams would be a blow given the plans announced this week for the redevelopment of the indoor market.
“We’re hopefully going to have the new hotel, and visitors to the city for things like conferences at the new ICC will have the opportunity to go to the shopping centre, go to the restaurants and bars, and the revamped market when that happens.
“The market is only five minutes’ walk away from the shopping centre, and these key components need to complement each other. If you get rid of one, it will have a massive impact on the market and the independent traders, which we can’t afford to do at the moment.”
Alan Edwards runs Vacara’s chip shop near the shopping centre. His shop has been shut for nearly two months since the outbreak of the virus, and he is worried about the impact losing Debenhams would have on footfall when he is able to reopen.
“I have 13 tables in my restaurant. If we are keeping to the two metre rule, I’ll only be able to use six of them when I reopen.
“I won’t even think about [reopening] until retail opens, because the town centre is really, really quiet.
“When retailers can open, people will want to come out for a change. But if there’s no shops for them to come out to, it’s going to be a completely different world. It will have a devastating effect on footfall.”
Tracy Stokes, who owns La Belle Femme boutique in Llanarth Street, said losing Debenhams “would be it” for the city’s retail trade.
“It would be a huge blow for Newport. People do come in and shop there, it’s the biggest shop in the city alongside Sports Direct.
“The only company that would be big enough to fill that space would be Primark, like they’ve done in Cwmbran and Cardiff.
“If the government is helping out the small businesses they should be able to help the bigger ones who aren’t entitled to much help.”
Councillor Jane Mudd, leader of Newport City Council, said the council was working closely with the Welsh Government to administer financial support to businesses.
“Losing any business from Newport would be very unfortunate. Debenhams was hailed as the anchor store of our Friars Walk development, and its departure from our city centre would be a great loss.
“I am in regular dialogue with Welsh Government and the Minister and have been championing the needs of the city and its business. I will continue to fight our corner with the long-term health and success of our city as my prime concern.”
Friars Walk shopping centre declined to comment on the future of its Debenhams store.
In Carmarthen, Debenhams has had pride of place in the town’s St Catherine’s Walk Shopping Centre since it opened a decade ago. Taking up a huge unit and spread over two floors, the store is seen as a key draw in attracting shoppers to the town from all over west Wales, from Llanelli in the east to Pembrokeshire in the west.
Neil James is vice chair of Carmarthen Chamber of Trade & Commerce, and he said Debenhams was vital to the prosperity of the shopping centre and the town itself.
“Every store in Carmarthen is vital at the moment and everyone needs assistance of some kind during this pandemic,” said Mr James. “But Debenhams is a very old firm and we enjoy having the store in the town.
“It’s made a big difference to Carmarthen since opening ten years ago because it helps bring people into the area. This is a very difficult situation we are in at the moment and we don’t know how long it will take for people to come back, so it’s important that shops like Debenhams continue to attract people.”
A petition asking the Welsh Government to amend its rates relief policy to help Debenhams keep its Welsh stores open had amassed over 3,000 signatures on Friday afternoon.
A Welsh Government spokeswoman said: “We decided to limit the NonDomestic Rates (NDR) Relief for the hospitality, retail and leisure sector announced to exclude the small proportion of properties with a rateable value of over £500,000.
“This affects fewer than 200 properties across Wales but releases more than £100 million towards our Economic Resilience Fund - enough to support more than 2,000 businesses with grants of £50,000.
“The Economic Resilience Fund will support businesses of all sizes, but especially micro, small and medium sized, in responding to the pandemic and received 6,000 applications within the first 24 hours of opening.
“We are also delivering a £1.7bn support package to provide businesses in Wales with certainty and stability during these challenging times.
“We will continue to consider how to best target our support where it will have the greatest impact in sustaining jobs and the longer term viability of our economy.”