Toys R Us UK : Stores Closing Down, Stores Staying Open, At Risk, The Warehouse and Head Office

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Toys R Us has recently stated publicly that it wishes to close at least 26 stores in the UK to allow it to continue as an ongoing business.

The 26 stores singled out for closure in spring 2018 have been already listed by The Toy Detectives. The list is also repeated later on in this article under the sub-heading Category 5 Leases.

Although Toys R Us in the UK has selected 26 stores for closure, there is still the very real possibility that more stores will close if the terms of a 179 page Company Voluntary Arrangement (CVA) have not been fully met.

The plan recently set out by Toys R Us is currently undergoing consultation, if approval from creditors fails to reach 75%, then there is the possibility that the whole company will enter administration and eventually liquidation, with all stores closing-down and all employees being made redundant.

Thankfully, that possibility has been made more remote due to Toys R Us offering creditors an option allowing the company to continue to trade and therefore suffer far smaller losses when compared to administration.

Overall, Toys R Us has identified the leasing and running costs of large warehouse-sized stores as the main burden against it operating profitably. Pop-Up stores are not affected by the CVA proposal, however, these stores are on short-term leasing arrangements that can be terminated according to the whim of both the landlord and the tenant.

In its CVA proposal, Toys R Us has banded its stores into a number of categories based upon the continued viability of the lease. Previously, national and regional newspapers have named the 26 stores destined for closure, however, there are many locations where Toys R Us wishes to benefit from a reduction in rent, a reduction in the size of store or even both a rent and space reduction.

Creditors to the company include suppliers of toys and nursery goods, landlords and foreign divisions of Toys R Us itself.

Category 1 Leases

Category 1 leases, describe stores that are performing adequately are otherwise important to the company from a strategic perspective.

  • Basildon
  • Coventry (the retail store)
  • Gloucester
  • High Wycombe
  • Ilford
  • Ipswich
  • Leicester, Highcross
  • Lincoln
  • Liverpool
  • Medway
  • Metro, Gateshead
  • Oldbury
  • Portsmouth
  • Reading
  • Stevenage
  • Stirling
  • Stockport
  • Swansea
  • Thurrock
  • Uxbridge
  • Warrington
  • Woking

Category 2 Leases

Category 2 leases,  describes marginally profitable stores but require downsizing and further capital expenditure. The company hopes to reduce the size of the space occupied and therefore the rent accordingly. The plan is that agreement of this by the landlord is achieved within seven months of the CVA being implemented.

  • Belfast, Castlecourt Shopping Centre
  • Coventry Distribution Centre (the warehouse that serves the national operation)
  • Derby
  • Harlow
  • Maidenhead Head Office
  • Poole
  • Wakefield

Category 3

Category 3 leases, are loss making stores where the company wishes to see both a immediate reduction in rent, plus a plan to downsize and to accordingly further reduce the rent so that trade can continue by the company.

  • Bedford
  • Brighton
  • Chester
  • Dundee
  • Enfield
  • Leeds
  • Merry Hill
  • Milton Keynes
  • Northampton, St James Retail Park
  • Norwich
  • Nottingham, Riverside Retail Park
  • Oxford
  • Peterborough, Bourges Boulevard
  • Preston
  • Sheffield, Meadowhall Retail Park
  • Solihull
  • Sprucefield, Lisburn
  • Sydenham
  • Teeside

Category 4 Leases

Category 4 leases, are loss making stores which the company wishes to agree to a reduction of rent. No downsizing nor capital expenditure by the landlord is considered necessary.

 

  • Brent Cross
  • Bristol
  • Chesterfield
  • Colliers Wood
  • Croydon
  • Glasgow, Helen Street
  • Hull
  • Luton
  • Mansfield
  • Southhampton
  • Stoke
  • Swindon

Category 5 Leases

Category 5 leases, are seen by Toys R Us directors as unviable even if a reduction in rent is offered. These stores have previously been named as the 26 stores due to close-down in spring 2018.

  • Aberdeen
  • Basingstoke
  • Belfast, Newtownabbey
  • Birmingham, St Andrews
  • Bolton
  • Bradford
  • Brislington
  • Cambridge
  • Cardiff
  • Derry City
  • Doncaster
  • East Kilbride
  • Exeter
  • Hayes
  • Kirkcaldy
  • Leicester
  • Livingston
  • Old Kent Road
  • Plymouth
  • Scunthorpe
  • Shrewsbury
  • Tamworth
  • Tunbridge Wells
  • Watford
  • York
  • Manchester, Central Retail Park

Pop-Up Shops

There also a number of Pop-Up stores that are not affected by the CVA. These stores are on either short term leases or rates-only licenses which can be terminated at short notice by either party.

  • Aberdeen Union Square
  • Banbury
  • Bayswater
  • Blackburn
  • Bromley
  • Cardiff Queen Street
  • Carlisle, The Lanes
  • Chester, Broughton
  • Craigleith
  • Derby, Intu
  • Doncaster, Frenchgate
  • Edinburgh, Fort Kinnaird
  • Glasgow, The Forge
  • Hemel Hempstead
  • Northampton, Weston Favell
  • Nottingham, Victoria Centre
  • Peterborough, Serpentine Green
  • Sheffield, Crystal Peaks
  • Stafford
  • Staines, Elmsleigh
  • Sunderland
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