Lotte Request to Lower Rent Denied

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According to a release from the airport, the request was for temporary adjustment and deferment of its financial obligations under its specialty retail concession agreement

The request was made in February 2015 and it has been confirmed that the airport turned down the request.

According to Lotte, they have been affected by the fluctuation of the Japanese Yen and Russian Ruble, along with extensive capital expenditures at the airport, and other extraordinary costs.  Lotte reported over $3 billion in annual sales in 2013 which obligates them to pay a minimum annual guarantee rent of $15.4 million, more than three times the minimum annual guarantee rent of the prior concessionaire. Lotte has also made over $20 million in capital investments for renovation and enhancement.

 Executive manager Chuck Ada says they believe Lotte will do their part but still the airport will remain protected in any case by a letter of credit in the event of non-payment or failure to meet the terms and conditions of the agreement. 

 

Although the airport denied Lotte’s request, Ada states that they will continue to discuss ideas and opportunities to enhance customer service and maximize revenues.