Mr Smiggle draws a line in the sand

Just Group’s Jason Murray (left) and Premier chairman Solomon Lew at a Smiggle shop in Bourke Street, Melbourne.

Scentre’s Peter Allen, Stockland’s Mark Stinert, GPT’s Bob Johnston, Vicinity’s Grant Kelley and John Gandel from Chadstone: now is the time to show your colours as the coronavirus wreaks havoc on the Australian retail market.

Solly Lew’s decision to day to close down his empire, stand down in excess of 9,000 people and refuse to pay rents until at least April 22 is not a short term move to ride out the virus crisis it is a fundamental change to the relationship between the landlords and retailers.

Much of the government’s economic package is designed as a bridge to get business through the virus to recovery.

Solly’s move has a lot longer time horizon. He has banged on about landlords for much of his career and here now is a chance to get fundamental changes while the landlords are under pressure.

The move is not without risks, because all of the Lew empire sells products that can be acquired elsewhere. So no Smiggle means you can get your pencil cases somewhere else.

But Solly probably figures the next couple of months will not see a lot of retail activity in his discretionary corner, so not to worry.

The state governments and the feds are coming at this from different angles, with the former more interested in the health issues and the feds both health and economic concerns.

The feds have talked up rental deals for a while now, but the package is yet to emerge.

As ever, timing is everything and Solly has struck before any deal is done with government.

Scentre’s Allen has waffled on about imminent statements on what will be done to help customers through the virus, but Solly has simply pulled the pin and demanded action now.

His retail guru Mark McInness told Sydney radio this week he had yet to receive a call from a landlord since the crisis hit.

That is truly bewildering.

Sussan’s Naomi Milgrom was quoted today wondering just why the malls are open anyway. She has a point.

The big banks have come to the party, promising payment deals to allow people laid off time to pay their mortgage later and have been backed by the Reserve Bank and Government to offer support to small business.

But the line in the sand takes this to a different level with big business fighting big business.

The shopping centre giants are under real pressure to offer rental deals to keep small shopkeepers alive.

This is the time for Messers Allen, Steinert, Johnstone, Kelley and Gandel to earn their social licence to operate.

Allen calls his malls living centres, Steinert calls them town centres and both boast that they have been granted immunity as essential businesses.

Like the banks, they will now realise this comes at a cost and Solly was quick state the obvious on rental charges

Its time for the landlords to tell us their plans.