Property group Land Securities and Spanish retailer Cortefiel have ended a tie-up designed to introduce new brands to the UK and shut eight stores.
Land Securities, through subsidiary Brand Empire, and Cortefiel struck a deal in February 2010 to run stores for three brands - Cortefiel, Springfield and Women’secret - but it proved too difficult in the current climate to establish the brands.
The first stores opened in September 2010 and the number rose to eight, all in Land Securities’ fully owned or joint venture-owned shopping centres.
Land Securities said it has already had expressions of interest for the store space in the affected locations.
Cortefiel said it remains committed to UK expansion and is searching for partners.
Richard Akers, managing director, retail, of Land Securities, said: “Brand Empire was born out of the recognition of the difficulties experienced by some retailers in accessing our market and the relatively moribund leasing market in the UK in late 2009, early 2010.
“Unfortunately we have been unable to establish the brands in the UK in what has been a challenging environment.”
He added: “While today’s course of action is regrettable we always recognised that our attempt to open up the UK market may not succeed and we structured our deals with this realistic outlook in mind. We have begun discussions with alternative occupiers across the vast majority of sites and hope to welcome new stores in the centres soon.”
Juan Carlos Escribano, chief executive officer of Grupo Cortefiel, said: “This innovative arrangement with Brand Empire was a good opportunity to test the UK market while reducing some of the risks usually encountered when entering a new market.
“However brands in apparel have their own pace for the different markets and the difficult trading environment in the UK and beyond did not help to sustain the commitment from both sides so we have decided with Land Securities to exit the agreement.”