Brand Empire and Grupo Cortefiel end agreement (UK)

Land Securities, through its subsidiary Brand Empire, has announced that it has ended its agreement with Grupo Cortefiel, one of Spain's largest and leading fashion retailers, and has closed the eight stores currently trading in the UK.

The deal with Grupo Cortefiel was agreed in February 2010 and covered three brands; Cortefiel, Springfield and women'secret. The first stores opened in September 2010 and only eight stores were opened in total, all in Land Securities' fully owned or joint venture owned shopping centers. Land Securities has already had expressions of interest for the store space in the affected locations.

Grupo Cortefiel is rapidly expanding operations worldwide, already present in more than 60 countries, and will remain fully committed to expand in the UK actively searching for partners that suit with the Spanish Group expanding pace and interests.

Brand Empire was envisaged to act as an incubator to attract new entrants to the UK market to help evolve the retail offer. It invested in the store set up and employees with Grupo Cortefiel retaining control of the product and brand marketing.

Richard Akers, Managing Director Retail for Land Securities, commented: "Brand Empire was born out of the recognition of the difficulties experienced by some retailers in accessing our market and the relatively moribund leasing market in the UK in late 2009, early 2010.

"Unfortunately we have been unable to establish the brands in the UK in what has been a challenging environment. While today's course of action is regrettable we always recognized that our attempt to open up the UK market may not succeed and we structured our deals with this realistic outlook in mind. We have begun discussions with alternative occupiers across the vast majority of sites and hope to welcome new stores in the centers soon."

Juan Carlos Escribano, Chief Executive Officer of Grupo Cortefiel, commented: "Our brands Cortefiel, Springfield and women'secret are already present in over 60 countries around the world, and opening stores in the UK is one of our obvious next steps.

"Our Group remains fully committed to expand in this market. This innovative arrangement with Brand Empire was a good opportunity to test the UK market while reducing some of the risks usually encountered when entering a new market.

"However brands in apparel have their own pace for the different markets and the difficult trading environment in the UK and beyond did not help to sustain the commitment from both sides so we have decided with Land Securities to exit the agreement."

The Brand Empire stores closing are located at One New Change in London, the White Rose center in Leeds, The Centre in Livingston and the St David's center in Cardiff.

Source: Land Securities

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