H&M sued for not paying rent on its New York flagship

H&M is being sued by New York’s Herald Center Department Stores for non payment of rent of its flagship store. The Swedish fast fashion giant, which in 2019 saw global operating profit surge to 1.8 billion dollars, owes 4.2 million dollars in back rent and other charges.

In March H&M said it would take measures to reduce operational costs to cope with the coronavirus pandemic and forced retail closures. These measures included reducing rental and real estate costs. At this time the company also reviewed “the potential need to terminate employment due to the negative impact of the corona situation on the business,” it said in a statement.

“We have a good and close partnership with all our landlords across our markets,” H&M told Footwear News. “Many understand the challenging situation we are facing and have chosen to cooperate with us during this extraordinary period. We always value our partnerships with the landlords and will continue to develop sustainable solutions that are suitable to both parties with the intention to handle this period in the best way possible.”

H&M’s Herald Square store is its largest global boutique. The company signed the lease in 2013, paying approximately 1.2 million dollars in rent per month.

H&M is not the only retailer behind on its rent. Last week Gap Inc was also sued by America’s largest mall operator for unpaid rents.

Image: rendering of H&M Herald Center via H&M