Property industry chiefs including Westfield’s Peter Miller have slammed Company Voluntary Arrangements and plans to introduce Chapter 11 style bankruptcy protection for UK companies.
The British Property Federation’s policy director Ian Fletcher has warned that “now is not the best time” for reform in insolvency practices, in the week that The Conservatives holds its annual conference in Manchester.
The Conservatives had mooted bringing in Chapter 11 protection for firms last summer, as a solution to concerns over the current insolvency process.
Property agent DTZ’s head of retail Martyn Chase said CVAs “an absolute disaster for the industry” and a “blatant abuse in terms of the retailers getting off the hook in terms of their property commitments”.
Miller said CVAs “set a very negative precedent for the market”, adding that Westfield preferred to deal with retailers and “on a one-to-one basis and not leave it to a vote from a variety of different landlords”.
Focus DIY and JJB Sports have both completed successful CVAs this year. Blacks Leisure is considering a CVA to get rid of its under performing stores.