STAFF AT an upmarket ladies fashion retailer have been locked out of the Dublin city centre premises in a row over commercial rents.
The confrontation is the latest illustration of the difficulties being experienced in the retail sector in paying rents negotiated at the height of the property boom.
Monica John, located on South Anne Street, off Grafton Street, was closed yesterday. A sign posted on its front door by landlord Royal Liver Pensions stated that, due to a dispute over rent, the shop has been locked and the stock removed.
John Murphy, a director of Monica John, which has two other shops in Co Cork, said the current rent on the premisis, some €108,000 annually, was negotiated four years ago during a period of high rents and economic growth that has since ended.
The dispute emerged as Minister for Justice Dermot Ahern said that legislation providing for downward rent reviews on commercial properties for the first time would be introduced in December at the earliest.
Responding to a Parliamentary Question from Labour TD Ciarán Lynch, Mr Ahern said a period of time would be needed to allow the market to factor in “the very significant changes” which were being introduced as part of the Land and Conveyancing Law Reform Act, 2009, which is to be enacted on December 1st.
Mr Lynch said he was disappointed to see the Minister taking a wait and see approach to the matter, which has posed problems for hundreds of retailers, and accused Mr Ahern of burying his head in the sand and hoping that the retail sector would be perfomring better come December.
“Irish retailers are paying out some of the highest rent values in Europe,” Mr Lynch said.
A campaign to end the upwards-only clause connected to commercial rents was mounted during the summer by tenants of shops on Dublin’s Grafton Street where about half the stores are said to be “over rented” by at least 20 per cent.
Mr Murphy said yesterday that he was out of the country when he heard that Monica John had been removed from the premises, where it has been operating since 1990.
The news came as a surprise as he felt the outstanding balance of rent was not particularly high.
“Our business has fallen considerably since we last negotiated a deal on our rent and we have been trying to get it reduced,” he said.
“Interest rates are down and we thought the landlord might be willing to talk to us. We have a rent review coming up next September and they said that rents are probably going to go up.”
Mr Murphy said he would be looking for a new premises in Dublin and that the stock removed from the shop would be collected.
A spokesman for Royal Liver in Dublin said he could not discuss the matter. Attempts yesterday to contact the societys UK-based property manager, Peter Fane, were unsuccessful.
David Fitzsimons, chief executive of Retail Excellence Ireland, which represents 580 companies with 8,000 shops, said rent increases are one of the biggest contributors to business failure in the retail sector which has seen 19 consecutive months of decline.
