Homebase plans to close 42 stores in the UK and Ireland, around 20% of its 250-store portfolio.
The proposed changes to the store portfolio will also lead to around 1,500 redundancies.
The news comes as the business prepares to outline its proposals for a company voluntary arrangement (CVA). The creditors will vote on the CVA on 31 August.
Damian McGloughlin, Homebase’s chief executive, said: “Launching a CVA has been a difficult decision and one that we have not taken lightly. Homebase has been one of the most recognisable retail brands for almost 40 years, but the reality is we need to continue to take decisive action to address the underperformance of the business and deal with the burden of our cost base, as well as to protect thousands of jobs.
“The CVA is therefore an essential measure for the business to take and will enable us to refocus our operations and rebuild our offer for the years ahead.”
Long leases on huge stores, averaging just shy of 40,000 sq ft each, have not helped it to reimagine the retail experience
Figures from Radius Data Exchange suggest 1.6m sq ft will be relinquished after these latest store closures, which are expected to take place during late 2018 and early 2019.
This brings the UK’s annual total of relinquished retail space, following CVA’s and administrations, to 15.6m sq ft.
James Child, retail analyst at EG, said: “Homebase has suffered over the past few years. The Bunnings takeover and attempted re-brand probably set the retailer back a few years in terms of the real issues in the sector it should have foreseen.
“A massive portfolio of stores just short of 10m sq ft has been a real issue. Long leases on huge stores, averaging just shy of 40,000 sq ft each, have not helped it to reimagine the retail experience.
“The challenging trading conditions in the DIY sector have continued this year. With less disposable income, consumers will often stifle home improvements in a first instance of cutting expenditure.”
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