Page 32 - June #173

MARK FAITHFULL

Following the

Money

29 Nov. - 1 Dec. 2022
Mark Faithfull crunches the numbers as he looks at Palais des Festivals
analysis and expansion that reflects changing markets. Cannes, France

As McDonald’s Exits Russia, China, Turkey, The leading international retail property
Brazil and India Step-In event to build the ultimate lifestyle and

McDonald’s has confirmed that it will permanently leave Russia shopping destinations
after over 30 years operating in the country and has started to sell its
restaurants. The move is not only hugely symbolic but comes at a time
when Russia is wooing Eastern and Latin American brands to replace
the Western companies temporarily or permanently closing stores.
Dozens of retail and F&B corporations have temporarily shut their
stores or have announced their permanent departure from Russia,
prompting the country to try and attract brands from Turkey, China,
Brazil, and India. The worst case scenario for Russian shopping centres
could see 30-40 per cent of stores empty, and Bulat Shakirov, President
of The Russian Council of Shopping Centres (RCSC) confirmed in
March that a representative of the body had visited Turkey aiming to
attract more than 200 brands, with a similar mission slated for China.
Amid the exodus, Indian retailers have also spied an opportunity for
expansion. Companies like home furnishing retailer Maspar and fashion
retailer Killer Jeans are understood to be looking to open in Russia,
while at least four companies have already agreed franchise agreements,
with more expected to follow suit.
McDonald’s departure came after it temporarily closed its 850
outlets in March and the fast food giant said Monday that it made
the decision because of the “humanitarian crisis” and “unpredictable
operating environment” caused by the Ukraine war.
UK Retailers Form Alliance to Demand End to
Norwegian Investors Set to Take Control of ‘Shops Tax’
London’s West End
Some of the UK’s biggest and most influential retailers have formed
Norwegian-backed real estate companies Capco and Shaftesbury are a temporary group called the Retail Jobs Alliance in an attempt to force
in advanced talks about a £3.5bn merger that would unite world-famous an overhaul of Britain’s outdated business rates. Grocery giants Tesco,
tourist destinations, including Covent Garden, Soho and Chinatown Sainsbury’s and Morrisons are among those to have agreed to back the
under common ownership. Alliance in a fresh push to reform the UK’s controversial business rates and
An all-share tie-up would bring together two of London’s most to demand the introduction of a new online sales tax.
prominent landlords, creating a powerhouse of West End property The coalition is urging Rishi Sunak to rip up Britain’s decades-old business
ownership as the capital tries to navigate its way towards a successful rates regime, which have long been a source of dismay for store-based
post-pandemic future. Capco is the landlord to stores and restaurants retailers and landlords. They claim that the punitive nature of the business
in tourist-magnet Covent Garden, while Shaftesbury owns blocks of rates does not recognise the pressure physical retailing is operating
other prime central London landmarks, such as nearby Seven Dials, under and also hands a huge commercial advantage to online players and
Carnaby Street and Chinatown, all in the heart of the West End. e-commerce specialists, creating an uneven playing field.
Shaftesbury would own 53 per cent and Capco shareholders would In a letter to Sunak, the new alliance - which also includes the Co-op
have the remainder in a deal structured as an acquisition of Shaftesbury Group, Kingfisher, Waterstones and food chain Greggs, plus a number
by Capco, the companies said in a statement. of retail trade bodies - said it was writing on behalf of organisations
Norges Bank, Norway’s sovereign wealth fund, is understood to be in collectively employing more than one million people - or one-third of the
favour of the deal and holds large stakes in both Capco and Shaftesbury. entire industry’s workforce.

mapic.com
50 RETAIL & LEISURE INTERNATIONAL NOVEMBER 2018