Major Australian retailer David Jones’s days could be numbered, as shopping centre Westfield confirms the department store chain has not paid rent since September and is in breach of its contracts.
A decision on the future of David Jones could be made within the next 24 hours.
The ABC understands the three-person board of the 188-year-old retailer will need to meet imminently to decide whether to put David Jones into administration.
Scentre Group, the owner of Westfield, issued a stock market update, revealing its financial exposure to the embattled department store.
David Jones has a network of 43 stores in Australia and New Zealand. (AAP: Dan Himbrechts)
It noted the chain occupied space at 17 Westfield locations and said David Jones had paid “all rent up to 30 September 2026”.
Scentre CEO Elliott Rusanow said David Jones had not paid rent since September and was “therefore in breach”.
Lifeline rejected, says Westfield owner
Mr Rusanow today said the shopping centre group had offered a lifeline but was knocked back by the private equity owners of David Jones.
“We have made a generous offer to Anchorage Capital Partners that would have facilitated the continuation of David Jones trading and that offer has disappointingly been rejected by them,” Mr Rusanow said.
David Jones was acquired by Anchorage Capital Partners from South African group Woolworths Holdings in late 2022.
Scentre’s ASX filing noted that David Jones had provided $45 million in bank guarantees for its stores across the Westfield Australia and New Zealand portfolio, of which Scentre’s share was about $30 million, equivalent to eight months’ gross rent.
David Jones’s key lender has chipped in extra cash to the store to stock up ahead of Christmas. (ABC News)
David Jones has a network of 43 stores across Australia and New Zealand, with flagship stores in Sydney and Melbourne CBDs, with about 50 million in-store visits a year and 5 million customers, according to its owners.
MST Marquee senior research analyst Craig Woolford said the implications of a David Jones corporate collapse would be “far-reaching”.
“An administration before Christmas, if that occurs, would negatively impact December quarter profitability for retailers competing against irrational discounting,”
Mr Woolford said.
“While never the ‘right time’, stakeholders will be looking to minimise the impact and maximise any potential recoveries.
“Longer-term growth opportunities emerge for better-positioned retailers.”
David Jones recently failed to file its financial accounts on time with the corporate regulator, ASIC, for a second year in a row.
If the board agreed to put the retailer into voluntary administration, thousands of jobs could be made redundant.
The news of the possible retail collapse comes a day after the Reserve Bank announced the fifth interest rate hike of 2026.
Reserve Bank governor Michele Bullock expressed some sympathy for those on the wrong side of interest rate hikes at yesterday’s press conference.
“The fact that we’ve had this massive shock has meant that we’re poorer and that’s what people are feeling,” she said.
The ABC has contacted David Jones CEO Erica Berchold directly for comment.
Source: www.abc.net.au
