Monday, February 21, 2011

Carphone withholding rent in dispute with docklands body - The Irish Times - Fri, Feb 18, 2011

THE CHIEF executive of Carphone Warehouse says it has not paid rent on its outlet in the CHQ centre in the Dublin docklands since April 2010 in protest at the behaviour of the docklands authority.

Stephen Mackarel said his company had been trying to discuss the future of the troubled centre with the executive of the Dublin Docklands Development Authority (DDDA) for more than a year, but has not received any response.

“Last March the then Minister for Justice, Equality and Law Reform Dermot Ahern said landlords across the country were having open dialogue with tenants to reduce rents. This has not been our experience with the State-run DDDA, which won’t even return phone calls.”

Mr Mackarel said the mobile phone retailer had not paid rent on its CHQ premises since April 2010 and had diverted the funds into a separate escrow account in an effort to force the authority to communicate with it directly.

However the strategy had backfired as the authority had initiated legal action for the non-payment of rent without first making any attempt to discuss its tenant’s difficulties, he added.

Mr Mackarel learned two weeks ago the authority was taking legal action when he read about it in The Irish Times. “Now a load of money will go to a firm of solicitors,” he said.

The company opened an outlet in CHQ in November 2007 and estimates it has lost approximately €500,000 as a result. It pays rent of €56,000 a year and has a long lease that includes an exit fee. “The market rent for the CHQ is zero,” he said.

The centre has an occupancy of approximately 40 per cent and has been described by Retail Excellence Ireland as the worst-performing shopping centre in Ireland.

Mr Mackarel said he was told in February of last year that the authority was preparing a plan of action for the centre but had heard nothing since. It was his experience that the authority got third parties such as solicitors to respond to queries, rather than sit down with tenants.

“We have decided to go public on the issue in a final attempt to push them towards open negotiation with their remaining tenants . . . We think their strategy of initiating legal proceedings against tenants is a total waste of money and should only be the final step in the process, not the solution.”

Carphone Warehouse has 78 outlets. A spokeswoman for the authority said it intended to pursue all outstanding debts. She did not want to comment further.

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