New lobby groups forming to protect smaller retailers.

Posted On Friday, 18 October 2002 10:01 Published by
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The struggle of small tenants against abuse by landlords in large retail developments got a boost from several speakers at the Seventh African Congress of Shopping Centres held at the Sandton Convention Centre in Johannesburg.
The struggle of small tenants against abuse by landlords in large retail developments got a boost from several speakers at the Seventh African Congress of Shopping Centres held at the Sandton Convention Centre in Johannesburg yesterday.

The comments came amid signs that the abuse of small retail tenants was on the rise, but there were also indications that these tenants were beginning to organise themselves into serious lobbying groups.

Landlords tend to give away a lot to national retailers in an attempt to stabilise new developments, and then try to make up these losses from the smaller tenants.

Yesterday's statements of solidarity were opened by Ellerine Brother's chairman, Eric Ellerine, who said that small tenants deserved better treatment than what they were getting.

About 60 small tenants at the Gateway Theatre of Shopping in Durban are up in arms with landlord Old Mutual Properties over rentals.

The tenants are demanding a rental review based on an argument that activity has not met promises made when they signed up.

They have employed Cape Townbased attorney Reid Corin, who has been locked in negotiations with Old Mutual Properties. The tenants said they hoped for an out-of-court settlement, but would take the matter to the highest court if necessary.

Another speaker, Wolf Cesman, executive director of Corpcapital, said landlords tended to be unsympathetic to genuine tenant problems.

Landlords leasing representatives were often unrealistic because they focused on continuing escalating rentals 'and are oblivious to business reality,' said Cesman.

Dirk Prinsloo from Urban Studies, who presented a survey on relationships between landlords and tenants, said 'the smaller retailers want to be loved and cared for'.

Prinsloo said there were concerns that the small entrepreneur and small retailer might disappear.

He said landlords should implement customer relationship programmes to assist in the development of retailers.

A warning against highly speculative retail developments that have led to the flooding of the market with retail space also featured prominently in a number of presentations.

Ellerine said that while some of the new shopping centres were aesthetically magnificent, they were struggling because their developers had been 'a little overambitious'.

Cesman said SA was overshopped. 'There has been contraction in the number and variety of retailers available to tenant our shopping centres,' said Cesman.

He said players in property development should view new developments with circumspect.

Business Day


Publisher: Business Day
Source: Business Day

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