Debenhams Demands Business Rate Cuts Ahead of Creditor Vote

Debenhams is demanding reductions in business rates alongside cuts to rents as part of its attempt to reduce its store occupancy costs, according to documents seen by the Financial Times. Last week, the struggling department store group confirmed it would launch a company voluntary arrangement — a type of insolvency proceeding — to restructure its expensive and inflexible leases, the Financial Times reported. That followed a financial restructuring through which the group’s creditors took control of its business and assets. The formal documents prepared ahead of a creditor vote on May 9 split the leases — held by subsidiaries Debenhams Retail and Debenhams Properties — into various categories and asked for rent reductions of up to 50 per cent. But they also requested reductions in business rates of 48-50 per cent in respect of 58 stores. “That is quite punchy,” said one restructuring expert. Read more