Saturday, February 14, 2009

Selfinterest and Selfdestruction

Landlords attacked as rejection of Stylo rescue puts jobs at risk

“The tone of the meeting was set when one of the advisers pointed out that this agreement would protect the employment rights of 5,450 people – and one of the landlords said, ‘Yes, but we don’t care about that, do we?’.” Wow... I am speechless.

Posted by peter_2008 @ 02:12 PM (1044 views)
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3 thoughts on “Selfinterest and Selfdestruction

  • You can’t critisise someone’s actions when you owe them money. As owner of the stores in question the landlord is entitled to decide whether or not it is in HIS best interests to agree to the CVA. The property company has shareholders, and they are who its managers are responsible to, not the employees of a totally different company. I wouldn’t be very happy if I was a shareholder in Hammerson and had just stumped up cash for their recent rights issue, only to find the managers of my company were giving it away to someone else.

    If all retailers thought they could get out of their rental contracts by going into a CVA, continuing trading and then being bought by a new company specially set up for that purpose, then they would all be at it. Hammerson were putting down a marker to their other tenants who might be getting ideas.

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  • I’m not at all surprised. In economic terms both sides (landlords and shopkeepers) exist to make money. Neither one has any “duty” to the employees – that’s the role of government.

    Same applies to bankers and their contractually guaranteed bonuses – appealing to the goodness of their hearts won’t change anything!

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  • A non issue. Its better for a landlord to charge high rents across the board with some default then lower the rents to everyone. The only case for lowering the rents to everyone is when no one can afford the high rents . Thats to do with the elasticity of demand for the rents themselves, which will be purely a decision for the landlords.

    I think generally think Peter you are confusing the obligations of the companies. As drewster in his first para says. However the retailed has more of a financial interest in the employment “protection” of its employees than the Landlord does – clearly.

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