Starbucks has asked for a break on rent in a letter to landlords, citing the need to “adapt to new realities” amid the COVID-19 outbreak, according to The Seattle Times.
The letter, signed by Starbucks Chief Operating Officer Roz Brewer, was reportedly dated May 5 and asks for changes in rent starting in June and extending for a year.
“Effective June 1 and for at least a period of 12 consecutive months, Starbucks will require concessions to support modified operations and adjustments to lease terms and base rent structures,” the letter reportedly read.
Starbucks did not immediately respond to Delish’s request for comment.
It’s not clear exactly which of Starbucks’ landlords received the request for rent concessions, but Starbucks landlords in Seattle and Tacoma, WA, told The Seattle Times that they had received the letter, though no specific requests had yet been made beyond the original letter. Per the paper, Starbucks Chief Financial Officer Pat Grismer noted that the chain had stayed current on its rent but appeared to confirm it would ask for some form of lease concessions from landlords in certain markets during an earnings call in late April.
“We are having ongoing conversations with our landlords in various markets regarding what may be commercially reasonable lease concessions in the current environment,” he said on the call. “We’ve not yet confirmed those arrangements and it’s really premature to indicate what that relief may look like.”
Starbucks is not the only national chain to request some form of rent relief. The Cheesecake Factory sent a letter to its landlords across the U.S. in late March stating that it would not be paying its rent for April.
Starbucks previously estimated it had lost $915 million because of the effects of the coronavirus outbreak, according to Business Insider. Starbucks moved to a mostly drive-thru-only model in mid-March, but announced that it would reopen 85 percent of its stores by the end of this week with enhanced safety guidelines. It expects to have more than 90 percent open by early June.