herald

Friday 11 July 2014

Korky's boss shuts up shop after rent battle

A WELL-KNOWNB shoe shop has closed its doors for the last time after a battle against 'upward-only rents' which the owner said had destroyed his business.

Korky's in Grafton Street has been shut by businessman John Corcoran.

The shoe shop had been in business on Grafton Street since 1992 and its closure will result in the loss of eight jobs.

Owner John Corcoran emerged as a national figure, thanks to a high-profile campaign against upward-only rent reviews when his rent shot up to €445,000-a-year back in 2005, from €210,000 a year.

An angry Mr Corcoran told the Herald today: "I feel very sad for the country with all the businesses having to close down because they were being forced to pay rents two or three times higher than they should have been paying."

While upward-only rent reviews were made illegal for new leases in 2009, all businesses on older leases remain at their mercy. "It is putting people on the dole all over Ireland. Businesses are being destroyed because of rents that are totally unjustifiable," he added.

In 2005, Mr Corcoran protested that he could not afford to pay the huge increase in rent imposed upon his business.

But with 15 years remaining on the lease, the businessman, who also has two other shoe shops, could not hand back the keys without being left with a multi-million euro bill for future rent.



Relief

At one point, he offered €300,000 to anyone who would take the lease off his hands, without success.

Mr Corcoran closed down the 900sq ft shop last night after landlord Canada Life agreed a deal freeing the shoe sales company from its €445,000-a-year lease early.

Details of the deal are confidential but it is understood that Canada Life agreed to break the lease early.

The closure of the Grafton Street shop brings to an end a 20-year business. Korky outlets on Henry Street and the Ilac Centre in Dublin and in Cork city will remain open.

The deal to close down the shop was "a happy relief", said the businessman, comparing it to the death of an elderly relative who had been in terrible pain.

Until now, he had been forced to keep the store open even as it lost money, just to meet the rent bill.

Upward-only contracts have been illegal for new leases since 2009, thanks to Mr Corcoran's campaign.

Ironically, Korky's did not benefit, because the harsh leases have only been outlawed for new tenants.

During the 2011 General Election, the campaign against upward-only rents for older leases was backed by both Fine Gael and the Labour.

Pat Rabbitte was among a number of Labour TDs to campaign with Mr Corcoran during the election.

hnews@herald.ie

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