The department store is one of the three locations that will not be closed after all.
(Photo: dpa)
Dusseldorf The department store group Galeria will get three more branches that were previously on the closure list, the company announced to employees on Thursday. “We have reached an agreement with landlords and we are pleased to be able to inform you that we can continue the locations in Regensburg am Neupfarrplatz, Dortmund and Bremen,” write the managing directors Miguel Müllenbach, Guido Mager and Olivier van den Bossche.
Most recently, Galeria planned to close 45 stores. Now only 42 of the 129 locations so far are to fall victim to the company’s restructuring. Galeria is in insolvency proceedings and can therefore terminate contracts at short notice regardless of the terms.
It is not the first correction of the closure plans. Shortly after the original list was published in mid-March, five locations were retained through additional concessions from landlords. Two more followed later. Among other things, the houses in Bayreuth, Erlangen, Oldenburg, Rostock and Leipzig will remain.
Relief for Galeria employees
Many branches on the original list were expected to give up the location because they probably did not generate enough sales or were not profitable enough, such as Gelsenkirchen or Cottbus. But there were also surprises.
The plan to close the store in Bremen in particular caused a lack of understanding both internally and in the industry. The house is considered a good source of income. It was quickly suspected that the location was only on the list to put pressure on the landlord to accept a rent reduction after all. Apparently that has now happened.
The 42 stores that could not be saved will close on two dates – some stores as early as June 30, the rest will follow on January 31, 2024.
Closing time
42
branches
closes Galeria until January 31, 2024.
The relief among the employees in Bremen, Dortmund and Regensburg is great. At the entrance to the Karstadt in Dortmund, which was supposed to be closed in January 2024, a sign already announces: “We will remain your number one shopping address in the future”.
Negotiations on rent and sales area
Originally, it was supposed to be clear at the end of January when the insolvency plan was presented which locations would be closed. But in January it became apparent that this schedule could not be kept. This was partly due to complicated negotiations with landlords.
When the management submitted the insolvency plan to the Essen district court on January 30, it did not even contain an indication of how many branches were to be closed, let alone a list of specific locations.
The company management has repeatedly emphasized that the question of whether a location will be retained also depends on possible concessions from the landlord. Galeria’s demands not only included a further reduction in rent and subsidies to modernize the houses.
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The central point of contention was often a reduction in the rented area. According to insiders, the optimal size for the company is a sales area of 15,000 to 18,000 square meters. But many houses are above it. The largest house even has an area of 38,600 square meters.
However, in most buildings it is difficult to separate individual floors and rent them out separately for structural reasons. Therefore, many real estate owners showed little willingness to compromise on this point. It is not yet known which concessions were made in Bremen, Dortmund and Regensburg.
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