The UK’s retail property sector is set for another significant period of change after TGJones secured High Court approval for a major restructuring plan that could see up to 150 former WHSmith high street stores close across the country.
The decision follows the acquisition of WHSmith’s historic high street business by Modella Capital, with the retailer now operating under the TGJones brand while WHSmith continues to focus on its travel division.
The restructuring represents one of the largest retail estate reviews in recent years and is expected to have implications for landlords, town centres, retail asset managers and commercial property investors as the business reshapes its nationwide portfolio.
TGJones currently operates 451 stores and employs more than 4,700 people, but the approved plan will allow the business to streamline its estate by closing underperforming locations while renegotiating lease agreements across hundreds of remaining stores.
As part of the restructuring, the retailer intends to significantly reduce its occupational costs. Around 120 landlords will receive no rental income from affected stores for up to three years, while rents across many other locations are expected to be reduced by between 15% and 75%.
For the commercial property sector, the move highlights the continued evolution of Britain’s high streets as retailers seek more sustainable operating models in response to changing consumer behaviour, rising operating costs and increasing competition from online shopping.
Store closures inevitably present challenges for landlords and local authorities, but they can also create opportunities for town centre regeneration through the repurposing of vacant retail units. Across the UK, former high street premises are increasingly being converted into mixed-use developments, leisure destinations, healthcare facilities, flexible workspaces, residential accommodation and community uses, helping to diversify town centres and attract new investment.
Modella Capital has confirmed it intends to invest £35 million into the business as part of its long-term recovery strategy. Alongside changes to supplier repayment arrangements and lease restructuring, the investment is designed to create a more financially sustainable retailer capable of adapting to today’s retail environment.
The company said many of the challenges inherited following the acquisition stemmed from years of underinvestment in the store estate, alongside a cash shortfall approaching £8 million. It also acknowledged that difficult retail trading conditions and the loss of the long-established WHSmith brand had added further pressure during the transition.
For the construction and property industries, the restructuring serves as another reminder of the changing role of physical retail. As occupier requirements evolve, developers, investors and landlords are increasingly focusing on refurbishment, adaptive reuse and mixed-use regeneration to ensure town centre assets remain commercially viable and continue to contribute to the long-term vitality of local communities.
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