Nearly 600 jobs have been saved at landmark Manchester department store Kendals after the local council intervened to prevent its closure.
The 182-year old House of Fraser store, in Deansgate, was set to close down in January after Mike Ashley’s Sports Direct – which bought House of Fraser out of administration in August – failed to agree new rental terms with the building’s landlords. However, the billionaire retailer said on Friday night that a deal had been reached, with Manchester city council playing an “instrumental” role.
The council leader, Sir Richard Leese, said: “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. I’d like to thank all involved for their positive engagement in this process.”
The rescue deal is good timing for Ashley, who is appearing in front of MPs on the housing, communities and local government committee next week as part of their inquiry into the future of the high street. Ashley demanded the meeting to spell out his views on how to help town centres after a series of closures and collapses among well-known retailers this year.
Announcing his request to see the MPs, Ashley said: “I believe politicians and landlords should be doing more to save our struggling high streets, so I intend to make the most of this opportunity to make a real difference.”
He bought House of Fraser for £90m when the 59-store chain collapsed into administration in August, and has so far pledged to keep 23 of the outlets open. He is in talks with landlords and is understood to be offering rock-bottom rents in some cases. Last month he also bought the collapsed Evans Cycles chain and has said that half of Evans’s 62 stores could close, depending on discussions with landlords.
Announcing the Kendals deal, Ashley said: “This demonstrates that when landlords, local authorities and retailers work together, the outcomes can be outstanding. When working together we can make a real difference to the high street.”
The huge Kendals store, which occupies nearly 390,000 sq ft, was bought by a private investor for £85m in 2016. Manchester city council had previously described it as “an institution”, with the art deco designs representing a “treasure of our city’s architecture”. The store employs 568 staff.
