Wilko’s landlords could go three years without rent

Struggling retail chain Wilko is trying to broker a deal whereby it pays no rent on some of its stores for the next three years.

The Times reports that, as part of a planned CVA, the Nottinghamshire discount retailer it looking to slash rents on 240 of its 400 stores.

This could mean that some landlords won’t receive any payment on their premises until the rent reverts to the contractual amount after three years under the terms of any CVA, says The Times.

Wilko says it doesn’t plan to close any of its stores as part of the CVA – but it isn’t hard to foresee that some landlords will simply take back their premises.

A Times source said that if the CVA isn’t agreed, Wilko could run out of cash and enter administration.

Mark Jackson, Wilko’s chief executive, told Sky News recently: “We announced the start of our turnaround programme to drive Wilko forward in January, complete with a new streamlined senior team and a strategic plan to first stabilise the business and then implement a growth strategy.

“We’re in the early stages of the turnaround and, as is usual, the directors continue to explore all options for Wilko’s long-term future.

“We’re confident with the right actions, we’ll continue to be a key feature on the British high street and expand our omnichannel offer, providing customers a place to shop all their household and garden needs.”

The move comes after Wilko hired property advisory firm CBRE to help with the CVA.