Partner Article

Deadline looms for “Portas Town” applicants

Towns across the UK have until the 30th March to bid for their share of £1 million to help them boost their ailing High Street and become a “Portas Pilot”.

In the wake of a review led by retail expert Mary Portas, the Government launched the scheme to help 12 struggling towns to revive their high street. In her report, Portas made 28 recommendations on what can be done to improve them, including business rate concessions, “town teams” to champion high streets and penalties for negligent landlords.

However, there are some concerns that the scheme could be undermined due to lack of funding.

Rod Wilkinson, associate partner at KPMG, Newcastle said: “Portas has sparked the imagination of many retailers and communities as well as putting the challenge of managing local conflicting agendas and rivalries squarely on their shoulders.

“Exactly how the scheme will be measured is yet to be clarified. But in spirit this concept of local community teams working together to come up with innovative ways to improve the high street is exactly what is needed and could be a first step to bringing some of Britain’s high streets back from the brink.”

In light of the monumental scale of the challenges high street champions are facing, Wilkinson is worried that a share of £1 million will not go far enough. In order to ensure that the the scheme is successful, he is now encouraging the Government to revise the allocated funding.

He added: “Without it these local communities are likely to struggle to make innovative changes.”

The recent collapse of a number of high profile retailers including Game, Blacks, La Senza and Peacocks also illustrate the need for upheaval on the High Street.

The culmination of persistently suppressed consumer spend, large rent bills and huge debt facilities is a toxic cocktail that many retailers in this region and others are unable to recover from, and Mark Firmin, KPMG’s Northern head of restructuring believes that a change from quarterly to monthly rents could help many retailers.

Firmin commented: “Moving to monthly rents can be a huge relief to a struggling retailer but, for many, their property portfolios are completely out of synch with their sales.

“While we have seen company voluntary arrangements used to restructure property portfolios since 2008, there have been few high profile CVAs in the past year.

“In the case of stressed and distressed businesses this is usually because a company’s problems run too deep for a property portfolio fix.”

“Certainly the Portas review has raised the profile and understanding of the issue but financial support to the tune of thousands is unlikely to help those retailers that are beyond redemption.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .