Westfield Kotara stores close as rent dispute escalates

At least five Kotara fashion stores are closed amid a rental dispute between shopping centre giant Westfield and some of its retail tenants.

The Katies, Noni B, Autograph and Rockmans stores, all part of the Mosaic Brands group, and Strandbags were all shut on Friday, and the shops' names have been removed from Westfield Kotara's online store directory.

Mosaic and Strandbags have been involved in negotiations with Westfield owner Scentre Group over rental agreements during the coronavirus pandemic.

Mosaic said on Thursday that Scentre Group had "temporarily closed" all 129 of its stores in Westfield shopping malls across Australia, affecting 400 of its workers.

"These actions are extremely disappointing given the current environment and difficult to comprehend in the context of a relationship that spans close to 40 years," Mosaic chairman Richard Facioni said.

"Mosaic continues to conduct rental negotiations in good faith with all landlords, including Scentre Group, in the spirit of sharing the burden of the impact of the COVID-19 crisis, consistent with government recommendations."

Mosaic said its affected employees had been redeployed.

The Newcastle Herald attempted to contact Scentre Group for comment.

The Sydney Morning Herald reported that Mosaic had been paying Scentre reduced rent in recent months and had tried unsuccessfully to reach a new lease agreement.

The Newcastle Herald has also been told of tensions between tenants and shopping centre managers elsewhere in Newcastle as foot traffic all but disappeared at the height of coronavirus restrictions.

Small business owners are particularly vulnerable if they are personally liable for meeting long-term lease commitments yet have drastically reduced sales revenue.

Charlestown MP Jodie Harrison, whose electorate includes Westfield Kotara and the GPT-run Charlestown Square, said Labor had been pressing the NSW government to provide rent relief payments for commercial and residential tenants.

She said Scentre Group's stance was hard to fathom.

"Westfield is one of those big players, and I'm sure they will make business decisions that are in their interests and not necessarily the interests of the people who shop in their centres or rent space off them," she said.

"People are unlikely to go into a large shopping centre that has lots of stores closed.

"I think it's a short-sighted decision on the part of the landlord. Surely from the point of view of a landlord it would be better to have a tenant in there."

Ms Harrison said she knew some of the workers in the shuttered stores.

"It's been a terrible time for many businesses, including retail and travel," she said.

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