When a major German retailer went into administration affecting 74 department stores all over the country, intensive care was urgently needed to stabilise the situation for over 100 sub tenants to protect their ability to trade unaffected by these circumstances.
Rapid action in 60 German centres
FI Europe was appointed by the companies with a brief to manage the properties, comprising a total of over 500,000 sq.m, with an average store size of 8,750 sq.m, spread over 60 different locations.
Short term and longer term strategies
The exacting role included hands-on property management on a day to day basis across Germany, minimising costs, maximising revenue and importantly covering all liabilities. But more than that, the brief included the ultimate sale of the 64 owned properties to recover the investment.
The immediate plan called for measures to be put in place to promote good tenant communication, ensuring that rent and service charges were collected on time, as well as keen negotiation with suppliers to reduce running costs.
Longer term, the strategy was to secure lettings for any voids, retain existing tenants, continue to cut running costs and to get the buildings ready for sale.
Successful sales and recovery
Over the past three years, over 30 new leases have been negotiated, running costs minimised, and revenues have increased.
Twenty five of the retail properties have been successfully sold at prices which exceed the allocated loan amount.