Famous department store Allders is in critical discussions with its landlord about reducing its rent bill as it battles a tough retail environment.
Allders, located in Croydon, aims to renegotiate its rent with landlord Minerva. A rent free period is one option being discussed.
Sources said that if Allders, the third largest department store in the country, fails to renegotiate its rent bill it may have to call in the administrators in “four to five days”.
A source close to the situation said Minerva remained supportive of Allders, and that it is working with the retailer to reach a solution.
The shop may play a large role in the redevelopment of Whitgift shopping centre in Croydon. Developer giants Hammerson and Westfield are in a battle to secure the rights to redevelop the scheme.
Allders is understood to have suffered from declining sales in recent months amid tough trading conditions.
It was reported in January that Allders chief executive Andrew MacKenzie led a management buyout of the business, leaving former majority owner Harold Tillman, who rescued the business - at that time a chain - from administration in 2005, with a 30% stake. However it remains unclear whether or not the deal took place.
Allders and Minerva declined to comment.