2,000 jobs at risk as Dwell, Internacionale, Ark and ModelZone head for administration

Internacionale, ModelZone and Ark have filed a notice to appoint administrators, while Dwell, the furniture retailer, has confirmed Duff & Phelps as administrators.

The administrations emerged just hours after retailers were due to pay rent for the next three months on Monday, the quarterly rent day.

The retail failures are another setback for the high street, which has already seen HMV, Blockbuster and Jessops collapse this year.

Clothing group Internacionale, which has almost 150 stores, has filed a notice to appoint Ernst & Young as administrator, while ModelZone has filed that it will appoint Deloitte.

Internacionale initially collapsed into administration in 2008 but was rescued by an Indian textile company.

The clothing retailer was understood to be looking to expand just weeks ago, as was ModelZone, one of the UK’s largest toy and model groups.

ModelZone has 47 stores according to its latest accounts and is majority owned by the private equity arm of Lloyds Banking Group, Lloyds Development Capital.

Ark, whose parent company is called Rett Retail Limited, is a fashion retailer primarily based in the north of England. It was founded in Leeds in 1992.

Today, Ark has 17 stores and employs 400 people, according to its website. It has lined up Begbies Traynor as administrator.

Jonathan De Mello at property agent CBRE said the administrations show some high streets are in “terminal decline”. He added: “For every retail administration we have seen, there are many other otherwise healthy retailers looking to downsize their store portfolios in all but the best retail centres, given changing consumer habits and the consequent redundancy of some of our high streets.”

The furniture retail Dwell also confirmed that it has appointed Duff & Phelps as administrator after closing its 23 store last week.

Around 300 jobs and £1m of customers deposits at risk from the collapse of Dwell.

John Whitfield, joint administrator, stated: “We are aware that there are a large number of customers who have placed orders with the company and have already paid deposits. Those customers who have bought goods and have outstanding orders should contact their card issuer in the first instance.

“Other customers who have not paid by credit card will be unsecured creditors and should notify Duff & Phelps in writing at its Birmingham office.”

Mr Whitfield said the administrators have “not concluded” whether they will honour gift vouchers.

On top of facing store closures, landlords will be furious that they face missing out on a quarter’s rent. Ian Fletcher, at the British Property Federation, said: “No one’s asking for favours here, just fairness to be injected into the process where retailers pay for what they use irrespective of the timing of an administration.”

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Posted on June 25, 2013, in Other. Bookmark the permalink. Leave a comment.

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