BHS’s company voluntary arrangement was this week approved by creditors, but landlords have warned that it may not be enough to secure the long-term future of the troubled department store.
BHS needs to raise £100m and modernise its offering.
Estates Gazette’s analysis of the CVA revealed that the process could save the business £27m, but this still falls short of what it needs to fund a turnaround.
One landlord affected by the CVA said: “The challenge for BHS is only just beginning and using a CVA to shed some onerous leases is far easier than turning the business around. I am sceptical it has a future.”
Market sources say that fundamental to BHS’s survival is the sale of its most valuable asset – the long-leasehold of its Oxford Street shop, W1, which is valued at around £85m. Prospective buyers for the asset are expected to include Lancer Asset Management.
The vote in favour of the CVA did not come as a surprise – many landlords were poised to support the decision soon after the proposal was announced on 3 March.
The worst affected are landlords that have a shop in category three of the CVA document, where only 20% of the rent will be paid for the next 10 months.
