Aberdeen’s Bon Accord centre collapses into administration


Aberdeen’s Bon Accord Shopping Centre Goes Into AdministrationThe owners of Aberdeen’s Bon Accord shopping centre have gone into administration. Guernsey-based Aberdeen Retail 1 Ltd and Aberdeen Retail 2 Ltd are said to have suffered “unsustainable” cash flow problems due to the Covid pandemic, rising costs and “intense” competition.

A buyer is now being sought. Administrators Azets said the city centre shopping venue would continue to operate as normal in the meantime until any sale.

The Bon Accord centre was built in 1990 and merged with the adjacent St Nicholas centre in 2020. It has branches of major stores including Next, Boots and Waterstones.

Azets restructuring partner James Fennessey said the sale offered a “very strong brand name and awareness”. “We are keen to try and find a buyer promptly,” he said.

At Aberdeen and Grampian Chamber of Commerce, policy director Ryan Crighton described it as “clearly a concerning development”.

What factors led to administration

One major factor was a drop in footfall, rising interest rates and the overall centre occupancy has been down since the coronavirus.

“The precedent has been set with other centres in the UK trading through administration for extended periods, which offers hope,” he said.

“The Bon Accord Centre has been at the heart of Aberdeen’s retail offering for over 30 years – and that must continue. However, if people want a vibrant city centre, this should serve as a clear ‘use it or lose it’ warning.”

Andrew Turnbull is a senior lecturer in retail marketing at the Robert Gordon University (RGU) Aberdeen Business School.

Mr Turnbull said: “Aberdeen has to cope with people leaving the city to go to elsewhere, to have weekends away to have big shops away, whether it’s Edinburgh or Glasgow, or even further afield.

“Individuals are not coming into the city since the start of working from home and hybrid working. People are doing their shopping locally rather than spending money getting in the car, cost of fuel is also an influence, and they are shopping in the suburbs, in the commuter areas.

“As far as Bon Accord is concerned, the competition from out of town centres, but more specifically in the city from Union Square shopping centre, will be major factors in the shopping centre’s performance.”

The average annual footfall to Bon Accord shopping centre was 15 million visitors before the coronavirus pandemic.

Azets said: “A diverse range of retail, hospitality and business tenants are based in the Bon Accord Shopping Centre and include a wide range of national high street retailers, specialist shops, restaurants, cafés and administrative businesses.

The joint administrators are encouraging interested parties to make contact as soon as possible and have appointed specialist commercial property agent Cushman & Wakefield to manage the sale process.

Read more: Paperchase lines up administrators

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Insolvency & Restructuring Expert at Business Insolvency Helpline

With over three decades of experience in the business and turnaround sector, Steve Jones is one of the founders of Business Insolvency Helpline. With specialist knowledge of Insolvency, Liquidations, Administration, Pre-packs, CVA, MVL, Restructuring Advice and Company investment.