Solomon Lew’s Premier Investments to shut Melbourne shops, stop rent payments

Several major retailers will shutter their Melbourne operations after Victoria imposed a new six-week lockdown on Tuesday.

St. Collins Lane shopping arcade in Melbourne on Wednesday. Picture: Paul Jeffers

Several major retailers will shutter their Melbourne operations after the Victorian government imposed a six-week lockdown on Tuesday.

Solomon Lew’s Premier Investments, the owner of Smiggle, Peter Alexander, Portmans and Just Jeans, said it would shut all its Melbourne metro stores on Wednesday night.

The closure will affect stores in 36 shopping centres and seven strip malls, but will not extend to Premier’s regional stores.

But some shops have said they will remain open and operations will remain unchanged.

Premier said it would not pay rent on its metropolitan stores during the shutdown, but its distribution centre and support ­office would remain open.

“These measures prevent the population from leaving their homes, other than for shopping for food and essential items, to ­attend work or education where this cannot occur remotely, for medical care or compassionate reasons, or for exercise and recreation,” the company said in a statement.

“As loved as our brands are by our customers, they are clearly not an essential service.”

The move by Premier follows the earlier shuttering of its shops across Australia by retail heavyweight Solomon Lew on March 26. Almost 9000 workers were stood down by Premier in March after the group closed its doors across the nation in response to the first wave of COVID-19 cases.

Apple joined the shutdown, announcing it would close all five of its Victorian stores from Wednesday. The tech giant had already closed its Highpoint store due to its location in a COVID-19 hot spot, and will now close the remaining stores from midnight.

“Due to current COVID-19 conditions in some of the communities we serve, we are temporarily closing stores in these areas,” an Apple spokeswoman told The Australian.

“We take this step with an abundance of caution as we closely monitor the situation.”

Premier Investments is shutting its metropolitan stores in Melbourne and says it won’t be paying rent while they’re closed. Picture: Getty Images

Apple had closed each of its Australian stores in February as COVID-19 hit, and reopened them recently, mandating temperature checks and masks for every customer.

UBS analyst Jon Mott said the recent COVID-19 outbreak was a “material setback”.

National Retailers Association CEO Dominique Lamb said the latest lockdown would prove costly for many businesses no matter the size.

“If we look at the impact of the last lockdown, Victorian retailers in our membership alliance lost over $800m in the month of March, so in this six-week period we’re talking millions being taken away from the retailers,” she said.

“This could spell the end of some of those brands. It’s going to mean very difficult things for retailers and make for very difficult decisions, especially in light of JobKeeper being reviewed,” Ms Lamb added.

She said retailers needed to engage in discussions with their landlords about how to deal with the new lockdown.

“For some of those retailers that don’t have great relationships with their landlords, who are not getting a response from their landlords, they have to seek advice and make decisions on that advice,” she said.

“We’ve got a range of landlords and they’re not all really big and some of them cannot sustain waiving these rents and, where that is not the case, the retailers can’t keep paying these rents.”

Swinburne Business School marketing lecturer Jason Pallant said it was clear the latest lockdown was a blow for businesses that had been gearing up to reopen.

“Even the national chains are going to be really impacted because Melbourne is a big market and we have the flagship stores for a lot of the brands,” he said.

“I wouldn’t be surprised about more retailers going into administration or closing permanently.”

Mosaic Brands — operator of Rivers, Noni B, Rockmans, W.Lane, Beme, Millers, Katies, Crossroads and Autograph — said it would follow suit and shut shops across Melbourne.

Bookshop chain Readings said that from Thursday its Melbourne bookshops would return to kerbside pick-up, with shops now closed to browsers.

Successful adventure-wear retailer Kathmandu, which shut its shops during the last lockdown, is yet to make a decision. But Super Retail Group, operator and owner of Supercheap Auto, Rebel, Macpac and Boating Camping Fishing, said it would be business as usual.

The same was true of Myer, which said its 11 Melbourne stores would trade as normal, with increased health and safety measures.

However, David Jones said it would scale back operations and reduce trading hours, putting a pause on on-counter and beauty services, lingerie fittings, alterations and dine-in services in all Victorian stores.