House of Fraser Manchester, the historic store known locally by its original name of Kendals, has been saved from closure after its landlord struck a last-minute deal with the department store chain’s new owner Sports Direct.
The store had been scheduled to close in the New Year but it has been reported this evening that a new rent deal had been agreed after Manchester City Council stepped in to mediate between Mike Ashley’s Sports Direct and the landlord to reduce the the £4.36m-a-year rent bill.
Nearly 600 jobs have been saved by the move, along with one of the area’s most iconic department stores, said Sir Richard Leese, Leader of Manchester City Council.
“Today’s announcement is fantastic news for the city and I am proud that the council has been able to play a constructive role in saving a real Manchester icon and hundreds of jobs,” Sir Richard told the Manchester Evening News.
Ashley added: “This demonstrates that when landlords, local authorities and retailers work together the outcomes can be outstanding.”
The proposed closure of Kendals had caused shockwaves in Manchester when it was announced last month. The Deansgate store’s history dates back to 1796 when a local farmer set up a drapery business in the area.
When he acquired House of Fraser out of administration in August of this year, Ashley vowed to keep as many of its 59 stores open as possible. He has since guaranteed the future of around 24 stores, including its London Oxford Street flagship and the historic Frasers store in Glasgow.
Others confirmed to be closing include branches in Cirencester, Hull, Edinburgh, Chichester, along with four stores in intu-operated shopping malls nationwide. Following the failure to negotiate new rent deals with intu, Ashley said he would pull all his stores (which amount to 17) from intu properties, however it was revealed today that he had acquired a long leasehold on the former BHS site in Derby from intu.