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Legacy lease structures could put retailers at risk, says accountants

A legal dispute between London's Brent Cross shopping centre and John Lewis could increase rental fees for retailers, warns accountancy firm Price Bailey, as the case challenges whether click-and-collect transactions should be included in "Turnover rent" calculations.
Data from MarketIQ shows over 79,000 UK retail companies are "technically insolvent" with negative net assets, as businesses already face substantial financial burdens from rising energy prices, employment costs, and elevated rents.
Stella Athanasiadou, Audit Partner at Price Bailey, notes that while individual impacts may appear modest, the cumulative effect could be significant for businesses with multiple sites incurring substantial digital infrastructure costs.
Of insolvent firms, 52% are in the Maximum Delphi Risk category, putting them at imminent risk of closure, a figure up 19% from last year according to Price Bailey.
Adam Norman, Audit Partner at Price Bailey, advises retailers to review lease terms and analyze sales data to understand exposure, as historic leasing structures often lack clarity on different sales channels.

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