Canberra Store Close Big: David Jones to Shut Woden Site
David Jones plans to close its Woden store as part of a 19-site shutdown across Australia and New Zealand. The Canberra Centre location will remain off the closure list, while the affected stores are expected to keep trading in the near term and may close by year-end.
David Jones will close its Woden store in Canberra as part of a 19-site shutdown across Australia and New Zealand, while its Canberra Centre location is not slated to close.
The decision forms part of an urgent restructuring of the loss-making department store chain. The affected stores will continue trading in the immediate future and are expected to cease trading by the end of the year, receivers FTI Consulting said.
Woden store among 19 closures
David Jones has two stores in the Australian Capital Territory. The Woden site is on the closure list; the Canberra Centre store is not.
The Woden store occupies 12,000 square metres at Westfield Woden. Big W, Coles and Woolworths, as well as a Hoyts cinema complex, also operate at the center.
FTI said staff at the affected stores had been informed and that consultations would continue over the next seven days. The receivers said the restructuring would significantly affect employees and pledged to treat them fairly and with respect.
“Whilst the impacts are highly regrettable, the receivers believe the steps are unavoidable if David Jones is to continue as a viable business,” FTI said.
Half of store network targeted
The closure plan covers half of David Jones’ 38 stores in Australia and New Zealand. It includes seven stores in New South Wales, three each in Victoria and Western Australia, two each in Queensland and South Australia, one in the ACT, and the retailer’s only New Zealand store, in Auckland.
The company employs more than 6,000 staff across its 38 stores. Receivers said the closure sites would remain open for now, with no final closure date announced.
David Jones entered voluntary administration last week after it could not pay its rent and rising debts prompted the appointment of receivers. Administrators McGrathNicol are seeking a buyer or new capital, while FTI has day-to-day control of the business.
Chief executive Erica Berchtold told suppliers that the retailer’s store portfolio was no longer suited to the business and that the changes aimed to create a financially sustainable network.
Rent arrears and worker support
Westfield owner Scentre Group told the Australian Securities Exchange last week that David Jones had paid rent at its 17 Westfield locations through the end of September. Scentre chief executive Elliott Rusanow said the retailer had not paid rent since then and was “therefore in breach.”
Bernie Smith of the Shop, Distributive and Allied Employees’ Association in the ACT said workers had served the company “with loyalty and pride.” He said the news was particularly stressful with Christmas approaching.
The union is contacting other retailers to seek jobs for affected workers and said it would work to ensure staff received their financial and legal entitlements.
McGrathNicol’s Matthew Hutton said administrators had seen an “extraordinary” level of interest in the retailer. FTI said the affected stores are expected to cease trading by the end of the year.
