The closure of a major clothing store has been described as a huge disappointment for the city’s Wellgate Centre.
Fashion retailer New Look looks to avoid collapse by shedding 980 jobs throughout the UK— with the Wellgate Centre store among 60 branches earmarked for the chop as part of a rescue plan.
It will come as a blow to the Wellgate, which has seen footfall drop in the years since the nearby Overgate Centre opened.
The Overgate is also home to a New Look store, which does not appear to be part of the closure plans.
The company confirmed that all stores will remain open as normal until creditors vote on a Company Voluntary Arrangement proposal on March 21.
A CVA is designed to allow a company and its creditors to reach agreement and avoid administration.
Lynne Short, city centre councillor and convener of the council’s city development committee, said the news was very disappointing.
She said: “I was aware that New Look’s lease at the Wellgate was coming up for renewal so I did wonder if this closure might be on the cards.”
“Unfortunately this is disappointing on two fronts, both for the Wellgate and for the people who may lose their jobs. It seems to be one thing after another for the Wellgate.
“We have looked at various options to keep the centre vibrant, including a project with students from Abertay University who we asked to try to come up with a plan of action.
“This is a national issue, however. It comes down to footfall and wages and people are obviously shopping much more on the internet and not in our high street stores.”
New Look said it was looking to close nearly 10% of its 593-strong UK store estate, with a further six sites that are sub-let also due to shut as it pushes ahead with a CVA. It said the closures would lead to redundancies, with up to 980 jobs out of its workforce of 15,300 under threat, although it said it would look to redeploy staff where possible.
Its rescue plan will also see the group ask landlords to slash the rent and revise leases on 393 stores across the UK.
Dundee businessman and president of the Scottish Chamber of Commerce, Tim Allen, said: “This isn’t good news for Dundee, which has a vibrant growing economy and used to have one of the busiest high streets in the country.”
Alistair McGeorge, executive chairman of New Look, said: “Given our challenged trading performance and over-rented UK store estate, we are having to take tough but necessary actions to reduce our fixed cost base and restore long-term profitability.”
New Look posted a pre-tax loss of £123.5 million in the lead up to December. The Wellgate Centre was asked for comment but had not responded at the time of going to press.