Office Outlet launches CVA proposal

The retailer said: “Given the significant decline in footfall at out-of-town retail parks resulting from recent retail failures and the current retail environment, a proposal to restructure the fixed costs is required to lead to long-term profitability.”

The store closures will result in approximately 44 job losses. Office Outlet said “every effort will be made to redeploy staff”.

Creditors will vote on the CVA proposal on September 6. It was reported over the weekend that the retailer would also seek rent-free occupancy of around 20 other stores.

Chief executive Chris Yates said: “Given the challenging UK retail environment and our over-spaced and over-rented UK store estate, we are having to take tough but necessary actions to reduce our fixed-cost base and restore long-term profitability.

“We have held constructive discussions with our key landlords and strategic partners and will now seek creditor approval on our CVA proposal.

This will provide greater security for our staff, suppliers, landlords, customers and members. This is a successful brand and we are confident the company will emerge in excellent shape from this process.”

Retailer CVAs, particularly that of House of Fraser, have prompted controversy.

However, Stephanie Pollitt, assistant director of real estate policy at the British Property Federation (BPF) said Office Outlet and its adviser, Deloitte, “have demonstrated best practice, engaging with the BPF early in the process, therefore ensuring property owners’ interests have been properly taken into account”.