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Half of Mall Varna's staff launch 48-hour strike from May 18 2009

Mon, May 18 2009 12:07 CET 1593 Views 3 Comments
Half of Mall Varna's staff launch 48-hour strike from May 18 2009

Nearly half the tenants in Mall Varna went on strike as of May 18. In total, 58 out of 130 stores would remain shut until May 20, the mall's management confirmed in a statement.

The protest is again motivated by unresolved issues of high rents that store owners are forced to meet, a concern that has prompted shops to strike before. The situation is made worse, the protesters say, by the unwillingness of the mall's management to discuss the matter with shop tenants.

The Bulgarian Retail Association (BRA) has announced its full support for the stores that have closed doors and gone on strike, Morski Dnevnik has reported.

"Lack of proper management and coherent strategy to attract new clients" are among the petitioners' grievances. They say that Miller Developments, Varna Mall's owners, had previously shown concern about the deteriorating economic situation and "had promised to re-evaluate the rents by conducting individual meetings with retailers between March 23 and April 17."

In light of the growing discontent, Miller Development had even promised to provide short-term financial assistance to the retail stores, they said, which had never materialised.

On May 17, Varna Mall said that Miller Developments "has understood the predicament, and in the best interest of the retail companies within the mall, and the establishment as a whole, offers have been made for the re-evaluation and alteration of existing contracts with individual business organisations, envisaging eased conditions for 2009."

The union of retail managers insisted, however, that the new offer actually entails far more severe repercussions for companies that cannot meet their contractual obligations towards the mall in full and are forced to close doors prematurely. Varna Mall's May 17 statement however said that the tenants who have decided to shut down their business permanently occupied about four per cent of the mall's commercial areas.

The statement also said that Miller Development has held individual meetings with more then 100 of the Mall's tenants in the past few weeks. In the past weeks three new contracts with new tenants have been signed over the past couple of weeks and negotiations with other potential tenants were on the verge of being finalised, the company said.

Earlier this year, on February 9, about 50 shops in the mall remained closed when sales clerks announced they were staging a protest.  

Tenants said then that sales declined because of the dwindling number of customers. Protesters wanted guarantees from the mall's management that that they would be able to keep their jobs despite the grim forecasts.

Antoniya Angelova, the mall's spokesperson, said, as quoted by Bulgarian-language Dnevnik daily at that time, that there had been no official request for negotiations and that protest organisers had not been for talks.

Angelova also said then that the "boycott" was orchestrated by store owners seeking to negotiate lower rents through unorthodox methods. The mall's management said it could only be a mediator and that the real issue concerned sales clerks and their employers - the owners.

In December 2008, Pfohe Mall in Varna had experienced a similar rebellion about rents. Tenants claimed that bad management had caused a fall in customer numbers and, as a consequence, demanded lower rents.

Recurring episodes in Varna appear not to have affected Sofia, where there have been no protests or requests to re-negotiate rental contracts.

Construction on about 25 new malls had been planned for around the country, but, according to the Bulgarian Construction Chamber, most of them would not be completed within the announced timeframes. Projects worth more than one billion euro have been frozen since the end of 2008.

Comments

Anonymous Alain Wed, May 20 2009 19:50 CET
Inappropriate comment?

I don't see why management are to blame for this. The stores made agreements for their leaseholds. if they can't pay then it's not their fault, not management.

A more plausible explanation for the situation is that the stores due to the current economic situation can no longer support the relentless expansion driven by mindless consumerism that had been going on for the past few years, and many of them face going out of business.

Serves them right if you ask me. The cultureless American-style consumerism malls like "Mall Varna" propagate is one aspect Bulgaria can do without.

Anonymous Jon Mills Tue, May 19 2009 06:58 CET
Inappropriate comment?

Building a nice mall with plenty of shops is only the start of the process - it is the ongoing management, marketing and entertainment elements that are the key to long term customer and public interest. Landlords here also quickly forget that tenant shops are their clients and should be treated fairly and with respect for their problems. Landlords/Investors need to pay more attention to the standard and style of management they appoint.

Anonymous Mat Mon, May 18 2009 22:53 CET
Inappropriate comment?

Macy's are in the Varna Mall? Wow.

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