Next has agreed a sale-and-leaseback with Aviva which means Next now take 25 year leases on the premises. The sale price is reported to be close to £50 million.
The sale-and-leaseback was a popular way to raise cash from fixed assets during the 2008-12 recession, and appears to be making a comeback. Further next sales are anticipated including the £43m sale of its Leicester head office.
The pandemic shutdown left Next, and other retailers, facing a more severe fall in revenues than they had expected. The collapse of both online and high street sales, meaning no revenue for more than the four weeks they had anticipated, posed a real problem. Late last year Next submitted a planning application for a new 770,000 sq ft warehouse at South Elmsall, Yorkshire.
The pandemic has exposed pre-existing weaknesses in many retailers, in the process causing renewed concern about Debenhams and forcing Oasis and Warehouse, fashion brands owned by Icelandic bank Kaupthing, to the brink.