Company Voluntary Arrangements are an 'absolute disaster' for the property industry, bosses have warned.
Under a CVA, troubled retailers continue trading in their stores but make a deal with landlords to pay only part of the rent. They need 75% of creditors to back their plans.
The CVA has emerged as an alternative to controversial pre-pack administrations, with Stylo, Focus, and JJB Sports all adopting them. Blacks Leisure, the outdoor clothing group, has indicated that it plans to close 89 loss making stores via a CVA.
However, speaking on the fringes of the Conservative party conference yesterday, property bosses criticised the restructuring method.