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| PCC's Santa arrives early with £175,000 gift for London Landlord. |
Cash strapped Peterbough City Council is spending £175,000 on renovating the former Woolworths building, a property they do not own and PCC will not benefit from rentals received, so the cash rich American owned retailer TK Maxx can move in. The news was greeted with mixed feelings as BBC Peterboroughs Breakfast Show broke the news this morning although reports say gaff prone MP Stewart Jackson (annual MP's expenses currently around £27,000) had let the cat out of the bag and tweeted the news some months earlier.
Although TK Maxx’s UK store numbers in Europe are growing, the fashion retailer’s US parent company has reported a dramatic profit loss for the first half of the year.
Profit at TJX Europe dropped from just over $34 million (£21.7 million) in the first half of 2009 to $7.9 million in the opening six months of this year.
Like-for-like sales at TJX Europe, fell four per cent in the second quarter, although total sales rose from $511.6 million to $528.2 million. These figures were reported despite TK Maxx opening 11 new stores across Europe in the last three months alone, with one of them located in the heart of London’s busy West End region.
US parent company TJX Companies - which owns American brands such as Marmaxx and HomeGoods - saw net sales for the second quarter rise to $5.1 billion and its international store portfolio increase by 33.
It's unclear why TJX Europe has seen such a significant reduction in profits, although foreign currency exchange rates were said to have had an impact. A statement from TJX Companies said: “Changes in foreign exchange rates affect the translation of sales and earnings of the Company’s businesses in Europe and Canada into US dollars for financial reporting purposes.
“In addition, for accounting purposes, ordinary course inventory-related hedging instruments are marked to market at the end of each quarter. Changes in currency exchange rates affect the magnitude of these translations and adjustments, and can have a material impact when there is significant volatility in currency exchange rates.”
Despite the profit slump in Europe, President and CEO of the TJX Companies, Carol Meyrowitz, said the business remains confident about delivering profit increases in the long term.
The discount store claimed it will bring at least 100 jobs to the city, but this is yet to be confirmed as jobs will depend on sales volume. The Bridge Street store plans to open in the Spring and optimistically believes it will see an estimated 20,000 shoppers pass through the store every week.
TK Maxx, Woolworths’ administrators Deloitte and Touche and the unit’s distant landlords LaSalle Investment Management, the latter (who logically should have properly maintained and updated the Bridge Street building) will directly benefit from the £175,000 of council funding being spent before the store opens on the ground and first floor of the four storey building in the Spring. It's not clear if the PCC expects to get the money back or is just reliant on business rates generated by a part occupied building.
From their website: LaSalle Investment Management is one of the world’s leading real estate investment managers with 30 years of experience. We manage approximately $40.2 billion of public and private equity real estate investments. Our diverse investor base includes public and private pension funds, insurance companies, governments, endowments and private individuals worldwide.
(C) Park Farm Neighbourhood Watch Peterborough UK Tel: 01733 345581 Broadcasters direct call ISDN 'down the line' 01733 555319 ISDN Codecs G722 & APT All Press Enquiries Julian Bray 01733 345581
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