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Mosaic Brands (ASX: MOZ) has struck a deal with major landlord Scentre Group (ASX: SCG) to reopen its stores in Westfield shopping centres outside Victoria, but the fashion retailer will still press ahead with plans to permanently close 300-500 shopfronts.
The breakthrough follows an announcement on 20 August whereby Scentre temporarily locked Mosaic out of 129 stores in Westfield shopping centres due to an impasse in negotiations.
In charge of such brands as Rockmans, Katies, Millers, Rivers, Autograph, Crossroads, Noni B and W.Lane, Mosaic Brands CEO Scott Evans recently said the group wanted to minimise closures but "not on uncommercial terms".
Evans said the retail rental market had not just paused due to COVID-19 but had "fundamentally changed".
Today the group confirmed the terms of its agreement with Scentre was confidential, but the successful negotiations mean all non-Victorian stores in Westfield shopping centres have now reopened.
"This is a good outcome for Mosaic and, in particular, the 400 affected team members. As we noted last week, shuttered stores work for no one," says Mosaic chairman Richard Facioni.
"We're pleased to have reopened our Westfield stores over the weekend following a mutually agreeable outcome to our negotiations with Scentre Group.
"We have had a long-standing relationship with Westfield enabling us to reach a solution that worked for both parties."
Victorian stores remain closed due to Stage 3 and 4 restrictions in the state.
"Our Victorian stores remain temporarily closed for health and safety reasons. We look forward to reopening those stores as soon as it is safe for our team and customers to do so."
Mosaic noted it would continue to negotiate with landlords nationally to achieve commercially sound lease terms consistent with the fundamental shift it sees in the market. It continues to anticipate shutting down 300-500 stores over the coming 12-24 months.
Updated at 10:25am AEST on 31 August 2020.
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