A global chain of coffee shops has sent a letter to their landlords asking them to provide a 12-month payment holiday.
The world's largest coffee chain Starbucks has sent a letter to its landlords with a request to provide a 12-month payment holiday, starting from June 1, 2020. The company notes that the concession is necessary to support the new environmental movement "together to withstand this uncertainty" in the face of the crisis.
U.S. retail space owners received a letter from Starbucks, signed by the company's chief operating officer, Ros Brewer, the day after the coffee giant began opening its outlets in the country. The company's sales plummeted in recent months as stores closed worldwide.
The company is currently negotiating with landlords in various markets in order to reach concession agreements under its current conditions, said Starbucks CFO, Patrick Griesmer.
The company manages 8,800 of its own and 6,250 partner coffee shops in the United States. Since the end of March, more than half of the establishments have been closed. In the coffee shops, which continued to operate in April, sales fell by 25% in the same period. Thus, the total losses of Starbucks are estimated at 75% of last year's level, writes Restaurant Business.
The company expects to reopen more than 90% of its outlets by early June, including through contactless delivery, online ordering, and other services, according to the company's website. Market participants who received a request for rental holidays for a year called it "ridiculous". Many of the property owners are investors loaned to banks who cannot provide discounts on the rent due to the threat of their own ruin.