Stop whining, landlords, a haircut’s better than a wipeout
Chopping Edcon’s rental was a win for listed property compared to the almost certain loss of a major tenant
If capitalism is about self-interest, then maybe the question as to who blinked first, Edcon or its landlords, is irrelevant.
The deal struck between the retailer, crippled for years by its private equity overlords, and many of the JSE’s listed property groups appears to be that rare beast: a win-win.
Sure, you could describe it as a coalition of the unwilling but a rental buzzcut versus the almost certain loss of a major tenant must be cause for relief among the JSE’s listed property investors, not dismay.
Yet while a short-term disaster has been averted, the bigger shift in retail’s tectonic plates is underway in SA and it’s not yet clear that local property groups, or retailers themselves, are going to survive in good shape.
Online shopping, traffic fatigue and the actual shopping experience are issues that both sides of the retail coin will have to confront. Getting consumers to the mall is one thing, convincing them to spend is another, and some of SA’s top retailers say their biggest headache is a lack of retail skill: staff who can sell, and not just pack shelves.
Back to Edcon. Its admission that it has too few staff in some of its stores is hopefully a recognition that the company needs to spend as much attention to the men and women who work its shop floors, as its balance sheet.