Rival supermarket chains Morrisons, Tesco and Sainsbury’s are reported to be among the retailers considering snapping up HMV properties to expand their profitable convenience store ventures.
HMV has some prime high street properties
Hilco took effective control of HMV last week when it acquired the company’s £176 million debt, but it is believed the restructuring specialist is only interested in holding on to around half of HMV’s 223 stores.
Consequently CBRE and Savills have been instructed to dispose of the remaining commercial properties and will begin considering offers shortly.
Moririsons currently has only 12 convenience stores, a fact which the company admits contributed to its poor Christmas performance. It hopes to open 50 more this year in a bid to catch up with its rivals. It is rumoured that the supermarket giant is also casting its eye over Blockbuster stores.
Tesco and Sainsbury’s are also thought to be considering bids for HMV properties as they look to build on their considerably larger convenience store chains. Asda, on the other hand, does not operate stores under 8,000 sq ft and is unlikely to join the race.
Convenience stores have been one of the few retail success stories during the recession reporting an average 4.6 per cent increase in sales over the past year. This is undoubtedly one of the factors that have led to supermarkets favouring small neighbourhood outlets over large out-of-town developments over this period.
Neil Saunders, of market analysts Conlumino, told the Guardian that due to the interest from supermarkets, demand is probably outstripping supply for these types of properties in the right locations.
“HMV has some quite prime sites on high streets, but not all its sites will be suitable,” he said.
Game, which was bought out of administration last year, is reportedly considering a bid for 45 HMV stores. New Look, JD Sports and US brand J Crew are among the other retailers believed to be interested in an unspecified number of the properties.
Previous Post
The Easy Way to Shop at IKEA
