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Protecting retailers occupancy interests through effective co–ordination
About the PMA
Out-of-Town Committee
Landlords Insurance Premium
ConferenceReport
A Retailers View
Legal Update
Questionnaire
PMA Events
NOVEMBER / 2012 / ISSUE THREE
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What is the PMAThe Property Managers Association represents the interests of retail organisations by enabling their respective property
professionals, to work together for their mutual benefit.
A brief history of the PMA Formed in 1975, the membership now includes around 105 of the country’s leading retailers. Members range from major High
Street retailers to out of town large space occupiers. It can boast a number of significant achievements, which have enhanced
the professionalism of the industry and improved the dialogue between landlords and tenants including work on the service
charge code, co-ordination of reviews on large schemes and shopping centre marketing guide.
The structure of the PMAAn executive Committee of elected members manages the Association. This committee is supported by a number of specialist
user groups and sub-committees representing members’ interests.
Our aims The role of the PMA is to raise and maintain standards of estate management within the retail industry
to ensure that property costs are kept to an affordable level and achieve maximum value for money.
This is being achieved through:
Communication - providing a framework for effective communication between property managers
Education - distributing appropriate information to members to help in their roles
Lobbying - helping to influence Landlords, Government, property professionals and other bodies
on issues relevant to the members
Liaison - working with other property trade associations and professional bodies such as the RICS,
BRC and BCSC
We currently have 104 companies listed as PMA Members. Since July 2011 we have new members namely, Bestseller Wholesale UK Ltd, Foot Locker Europe JD Sports Fashion plc, Steinhoff UK Group Property, Super Group plc, The Edinburgh Woollen Mill, The Money Shop and Waterstones.
PMA Newsletter 2012_V4.indd 2 08/08/2012 11:17
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Once again I am pleased to welcome
you to our PMA newsletter, both as a
means of updating our membership
and informing those who are new to
the work of the PMA.
The recession and its ongoing impacts
on the retail industry continues with
further casualties on the high street.
Retail property and occupancy issues
remain a key factor the recovery of
the industry.
The last year has seen the publication
of the high profi le Mary Portas Review,
and the initiatives to aid the recovery
of the high street. The PMA similarly
continues to strive to challenge on
behalf of our members on the key retail
property issues, and drive coordination
between our members.
Our recent Conference held at Old
Trafford in Manchester in May brought
enlightening debate on what are the
main issues to our members. The ability
of a retailer to realign their portfolio
to their business needs is key, and
lease fl exibility is now seen as a key
strategy for retailers’ portfolios.
Given the concern over the vacancy
rates, new initiatives are essential to
the future health of our retail centres,
including the likes of the thorny issue
of business rates liabilities and car
parking charges to name a few.
The PMA Committee welcome your
feedback on any initiatives we
should focus our resource on and
the questionnaire at the back of
the newsletter helps us get your
honest feedback.
The PMA will be present at the BCSC
Conference in Liverpool in September,
so please come and visit us at our stand.
As always the PMA continues to be an
important organisation for our retailer
member’s property interests, and
your help, time and suggestions
are always welcome.
James Hamilton
Head of UK Acquisitions & Estates,
Costa Coffee
PMA Presidents update
A new web site has been launched
this year!
New members area Recruitment page Members blog
Get blogging! - Easy way to connect
and share your views with the members!
The PMA are now on Linked In.
and Twitter
Visit www.linkedin.com
login: [email protected]
password: pmaboard
Visit www.twitter.com
login: PropertyManAssn
password: pmaboard
Contact PMA PMA Administration and Event
Co-Ordinator
Louise Oliver
The Dolls House, Audley End Business Centre
Wendens Ambo, Saffron Walden,
Essex, CB11 4JL
Tel: 01799 544904
Fax: 01799 542991
Email: [email protected]
PMA connect with the members
You may or may not already be aware
that the PMA has a sub-committee
for the ‘Out of Town (OOT)’ sector
specifi cally for retailers/occupiers
of Retail Warehouse Parks across
the UK. We meet every 4 months
in various locations across the UK
where we; discuss issues, host talks
on hot topics from industry experts
and invite presentations from service
providers i.e. Facilities Management
companies, Solicitors fi rms, etc.
The Retail Warehouse OOT tenant
meetings are an opportunity for
retailers to get together to discuss
issues that we have with our Landlords,
both negative… and positive! The aim
is to communicate with our Landlords
more effectively with the backing
of the members of the PMA, and to
improve working relationships.
Details of the meetings are posted
on the PMA website well in advance
under the ‘Events’ section and all
members are welcome to attend to
make the most of their membership
with the PMA.
I look forward to seeing you there.
Alex Stanhope MRICS
Halfords
OOT Committee
propertymanagersassociation.com
A new web site has been launched
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Landlords Insurance Premium A retailers viewBackground
In recent years there has been a
significant improvement in the way
landlords compile, manage and
communicate their service charges to
their tenants. This has had led to far
greater transparency regarding one of
an occupiers major costs.
I believe that the property industry now
needs to extend this level of interest to
landlord’s insurance premiums. Whilst
not being of the same financial value it
is a significant cost that occupiers are
having to pay, with in many cases, little
or no explanation from the landlord.
Whilst in new leases some element of
control can be secured I would suggest
that at no time has a new store been
turned down because of the wording
of the insurance clause. However the
most pressing problem lies with the
vast number of existing leases and their
inherent problems.
Current situation
The payment of such premiums is
dealt with in a lease with often only
a few lines of generic wording giving
I believe a significant proportion of
landlords ample opportunity to simply
charge their tenants a cost without any
satisfactory way for this to be discussed
or challenged.
Many landlords send in their demands
sometimes several months after the
renewal date often without an insurance
schedule and expect payment without
dispute. There is a wide variation across
landlords and their agents as to what
information is passed to the tenant
to allow them to make the necessary
judgement.
Often if the premium is disputed
the answer is “well it is what it is”.
Landlord’s agents often have limited
knowledge and simply pass on the query
to the insurer who will come back to the
tenant after several months with a bland
and confusing explanation still expecting
payment without question.
There is a dramatic inconsistency with
regard to the level of premiums for
same types of property in the same part
of the country with a complete lack of
transparency as to how the premiums
are calculated. I am sure most tenants
would have no objection to pay such
premiums if there was some rational
explanation attached.
There are several problems that
need addressing.
n A lack of transparency over how the
charges are calculated
n A concern that tenants are paying
unnecessary charges
n There appear to be few actual
suppliers
n There is a nationwide inconsistency
in premiums
n No simple way to challenge a
premium
n Lack of knowledge by
managing agents
n Lack of consistency of
information provided
n What is provided is often too
confusing and not relevant
n No benchmarking in the property
or insurance industry
Summary
I appreciate that insurance is often the
lowest cost for a property occupier
however I am sure that some occupiers
have started to look at this cost in far
more detail.
The improvement in service charge
transparency shows what can be done
and I see no reason why the same
measures cannot be taken with regard
to insurance premiums. New leases need
address this matter and there should be
a minimum level of consistency applied
across the industry.
The ultimate recourse is to the solicitors
which can be a costly and lengthy
exercise for what on its own is often a
relatively small amount compared to the
overall occupancy cost of the store.
Landlords and their agents now need to
treat these charges in the same manner
as service charges. I believe tenants should
receive clear and concise information as
to what they are being asked to pay with
some level of justification.
If as occupiers we can pull together
our experiences then I would hope
that some influence can be brought to
bear in attempt to end the continuing
inconsistencies.
Nick Kidd
Senior Estates Manager
Wilkinson Hardware Stores
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The documents and guidance are available at
http://www.rics.org/smallbusinesslease
As a fi nal thought, I do wonder what merit there
may be for the future in leases being all inclusive
of both insurance and service charge.
Building insurance – a reminder
The government “deal” with the insurance
industry runs out next year. With the issue of
fl ooding very much in everyone’s mind, there is
no guarantee that continuity of fl ood insurance
will remain. While there is perhaps not much that
can be done about existing property, I strongly
recommend that appropriate fl ood searches be
undertaken if you are acquiring new property.
Even awareness of the risk of fl ooding may result
in fi t out in such a way as to reduce the period of
closure/cost of clean up, if the worst happens. In
essence, forewarned is forearmed!
1954 Act renewals
In my view, these are becoming increasingly
frustrating and costly. Slavish adherent to 1980s
lease terms does no one any favours. A deal
negotiated between a major landlord and a high
street multiple on one property should not then
be ignored by the very same landlord’s solicitors
with the same parties a few months later!
This is unhelpful at best. There is much
which can be done here by landlords in
customer service terms.
14 November 2012 Business Lunch Seminar
at SNR Denton
I am delighted to be able to confi rm the date for
this Seminar. The precise topics are under review,
but may include:
n 1954 Act renewals – what tenants should be
entitled to expect?
n Cost of consents – and what should
require consent.
n Break clause drafting.
n Investing time at the start.
Nick Darby
SNR Denton UK LLP
DDI: 020 7246 7466
Email: [email protected]
On 26th July, Anna Collier carried the
Olympic torch along the Kings Road in
London. Anna is co-founder of The 3 Little
Miracles Fund and wife of Cushman and
Wakefi eld retail partner, Andrew Collier.
The 3 Little Miracles Fund has been the
PMA’s chosen charity for the past 12 months.
Anna was originally nominated to carry the
torch by the Chelsea & Westminster Hospital,
for which the charity has raised £250,000 to
purchase life saving neo-natal equipment.
Anna said before the torch run “to carry
the torch through Chelsea, close to the
hospital where the triplets were born will be
humbling and incredibly emotional for me
and my family. What started off so badly
for us in the Chelsea & Westminster Hospital
and has led me to carrying the Olympic
torch through the streets of London, my
home town, will be an amazing honour and
something I will always cherish”.
The charity has gone on to raise a further
£100,000 to purchase life saving incubators
for other hospitals in the UK. With the
£17,500 raised by the PMA at the 2011
Christmas Lunch, the charity is currently in
discussions with Plymouth General Hospital
to buy them a much needed state of the art
surgical incubator.
3 Little Miracles charity fundraising Olympic torch bearer!
Legal update
RICS Small Business Retail Lease
4 July marked the launch of the RICS Small
Business Retail Lease. With a vacancy rate of
over 11% across UK high streets, the RICS is
looking to do what it can to revitalise this vital
section of the UK economy. With confi dence
at a low ebb, what can be done to encourage
entrepreneurship, to help small businesses,
and to persuade those thinking about a new
start-up to take the plunge?
Commentators often say that property
problems give some of the biggest headaches
to small business, perhaps through infl exible
arrangements. It is at the stage of starting
new business that those involved most need
legal advice, but can at least afford it. So
much the better if some of those issues can
be removed, leaving the SME to concentrate
on the business itself. This is what the RICS
initiative is designed to do, in consultation
with the BRC.
In practice therefore it is a fl exible
arrangement and a real encouragement for
new business start ups. If this works, more
retail property will be occupied, and high
streets regenerated. Landlords will receive
rent, and tenants not forced into insolvency
by infl exible property costs if the business
does not take off as expected. Business
planning is easier. In an ideal world these
arrangements may also encourage greater
bank lending to small business. As always,
the use of the documents, free from the
RICS website, depends on awareness.
While the initiative may not be directly
relevant to PMA members, you may have
sublet properties or smaller units, where these
arrangements would be suitable.
It is to their great credit that the BPF also felt
able to support this initiative.
Having been involved with the project from
the start, and having drafted the various
documents for the RICS, I would be delighted
to provide further information/details to any
member. My contact details are at the end of
this update. propertymanagersassociation.com
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PMA Conference report
After many years at Old Trafford cricket
ground, the 2012 Conference moved
a short distance away to the football
ground which, for 1 day only, became
the “Theatre of Retail Dreams”.
The Conference was attended by a
record number of 160 delegates and
provided some excellent networking
opportunities. The PMA President,
James Hamilton, introduced the
Conference and, for the first time, a
Master of Ceremonies, in the form of
Simon Williets, kept everything on
schedule with an interesting program of
speakers throughout the day.
List of Speakers.
Dan Kidd of SNR Denton gave a
highly topical landlord and tenant
overview for retailers.
Andrew Dudley & John Grimes
of Land Securities gave a detailed
summary of both the development
program and the letting campaign
relating to that rare commodity, a major
new retail scheme opening in 2013,
namely TrinityLeeds.
Howard Morgan of Real Service,
supported by contributions from John
Gray of John Gray Service Charges
and Rob Wood of HMV, gave an
overview of the marketing budgets of
shopping centres.
Sean Gillies of Savills provided an
overview of the state of the retail
market in 2012. This encompassed
both the in town and out of town
sectors along with some analysis of the
investment market.
Louise Oliver gave delegates a
summary of the workings of the new
PMA website, ably supported by
Ed Budden.
Panel Discussion.
For the first time in many years, the
Committee had invited a panel which
comprised Gerald Jennings of Land
Securities (Landlord), Stuart Donald
of Disney (Tenant), Colin Flinn of
Tushingham Moore (Agent) and Nick
Darby of SNR Denton (Solicitor). The
idea was that a number of current day
topics would be debated following
the discreet promptings of James
Hamilton performing as Moderator.
Some of the points discussed by the
panel can be summarised below:-
Development Pipeline – likely to
recover in due course but, in the
meantime, expected to focus mainly
on infill and extensions of existing retail
space. Whilst extensions to existing
schemes have their attraction in terms
of building on existing retail offers,
they may be difficult to deliver at the
current time because of landlords
cashflows and limited bank lending.
Vacant Space - who is backfilling this?
There are valuation issues for landlords
in terms of their capital values. Should
landlords show more flexibility in terms
of lease length, perhaps a minimum
term of as little as one year.
Upward or Downward Rent
Reviews – do not seem to be the
top of retailers’ agenda. Main focus
in agreeing either a new acquisition
or a renewal with rent free periods,
cash incentives, and 5 year tenant’s
break on a 10 year lease. Pressure on
property departments to achieve tenant
flexibility.
Retailers being prepared to threaten to
leave at lease expiry.
The Portas Review – it was felt
that there is a focus on anything that
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generates cash fl ow from a Council
perspective, such as parking charges.
The latter can clearly be a deterrent in
a diffi cult trading environment when
compared with, for example, free out
of town parking facilities. In respect of
rates, there is no link between rates
generated at the local level and the
actual income that Councils receive
from Central Government. Towns need
to be treated, and run, as a “business”
Secondary Shopping Centres
- there have been a number of
structural changes in terms of
ownership of secondary shopping
centres. This has lead to some very
inconstant landlord strategies with
these secondary retail assets.
Convenience of Retail Environment
- there is a need to make shopping
more convenient within the town
centre environment. BIDS can be part
of the answer to improving the retail
environment in struggling towns.
Free Car Parking – this really would
make a difference to some of the
struggling retail environments in
medium sized towns. Should some
former and unwanted retail property
be converted to other commercial uses
or even residential? A more fl exible
planning policy is needed.
Rating Consultants - the work of
rating consultants was discussed. Are
they picking up new information?
In particular, are they aware of
permanent changes to pitches and
hence appropriate rates levels? Could
MCC appeals be resolved much
quicker, thereby giving the necessary
relief to the retailer asap.
Summary
Since the Conference, Committee
members have received very positive
feedback from delegates in respect
of the venue, the speakers and the
topics, and the panel discussion.
Certainly, the latter was far ranging
and quite spirited at times with a
number of highlights being some
exchanges between members of the
panel and retailer delegates in the
audience. The Committee will now be
reviewing the Conference in further
detail so as to ensure, at the least,
an equally successful event in 2013.
The Committee would welcome any
additional feedback or suggestions
from the wider membership.
Simon Williets
Asset Manager
Starbucks Coffee Company
Direct Dial: 020 8834 5325
Mobile: 07957 773051
Email: [email protected]
propertymanagersassociation.com
PMA Newsletter 2012_V4.indd 7 08/08/2012 11:17
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growth strategy and will be used as
a regional facility to service its stores
throughout Southern England.
Financial and Operational Highlights *n Turnover of £780 million - up 21.6%
(52 weeks +19.3%)
n Underlying EBITDA of £40.1 million
– up 26.5% (52 weeks +24.1%)
n Gross margin of £287.7 million – up
22.2% (52 weeks: +19.9%)
n Strong LFL growth of +2.3%
(all volume growth), outperforming
the market
n Net borrowings reduced from £34.0
million to £26.1 million
n 62 new stores opened. Total year
end store numbers 389 (+19%)
n Over 4 million customers served each
Poundland, Europe’s largest single
price discount retailer has announced
results for the 53 weeks ending 1 April
2012. The trading figures demonstrate
another successful year for Poundland
as it continues to expand across the
UK and Republic of Ireland, with the
successful opening of 9 stores in the
Republic of Ireland trading under the
“Dealz” fascia adding to the total
of 62 new stores opened, the year
ended with 389 (+19%) trading stores
creating c1,500 new jobs.
In addition, Poundland were delighted
to be announced winner of the 2011
Discount Retailer of the Year award.
Poundland is on track with its growth
strategy to open at least 60 new stores
together with a new south eastern
distribution centre in the current
financial year, during which, the
company will create up to 2,000 new
jobs. So far this year, 22 new stores
have already opened including 4 in the
Republic of Ireland. In April, Poundland
achieved another milestone by opening
its 400th store in Haringey, London.
The new 200,000 square foot south
eastern distribution centre will open in
August at Hoddesdon, Hertfordshire.
The warehouse supports Poundland’s
Poundland
week up from 3.5 million in 2010/11
n Continued focus on strong product
offering with over 3,000 product lines
including over 1,000 well known
branded products sourced directly from
major manufacturers
n European expansion with successful
opening of 9 stores in the Republic of
Ireland trading under the “Dealz” fascia
n c1,500 new jobs created
n Winner of 2011 Discount Retailer of
the Year award
Contact: [email protected]
Tel: 0121 526 8742
www.poundland.co.uk
*Fin
anci
al a
nd O
pera
tiona
l Hig
hlig
hts
PMA Newsletter 2012_V4.indd 8 08/08/2012 11:17
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Sponsored by
PMA Newsletter 2012_V4.indd 9 08/08/2012 11:17
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PMA Committee Members 2012 President
James HamiltonHead of UK Acquisitions & Estates
Costa Coffee – PropertyMob: 07557 114431
Email: [email protected]
Financial Management
Richard WhiteThe Estates Consultancy CompanyMob: 07788 452972
Email: [email protected]
Committee Members
Mark BowlesProperty Director
HMV Group plcDD: 020 7467 1126
Email: [email protected]
Edward BuddenEstates Manager
Coral Racing Ltd DD: 020 3288 7163
Mob: 07841 566867
Email: [email protected]
Nick KiddSenior Estates Manager
WilkinsonDD: 01909 505724
Mob: 07772 111287
Email: [email protected]
Dan QuinnEstates Manager
Deichmann ShoesDD: 01858 436519
Email: [email protected]
Graham SeatonProperty Director
Irisa Group LtdDD: 01582 399805
Mob: 07900 681816
Email: [email protected]
Joseph SimonsSenior Estates Manager
Boots UKDD: 0115 968 7627
Email: [email protected]
Alex StanhopeEstates Surveyor
Tel: 01527 517601
Email: [email protected]
Faye StevensonMothercare Group plcTel: 01923 206264
Mob: 07436 032027
Email: [email protected]
Ben WallNational Portfolio ManagerPoundland LtdDD: 0121 526 8742Mob: 07766 490472Email: [email protected]
Simon WillietsAsset ManagerStarbucks Coffee Co UK LtdDD: 020 8834 5325Mob: 07957 773051Email: [email protected]
Rob WoodEstates SurveyorHMV Group plc
DD: 0207 432 3034Mob: 07770 637580Email: [email protected]
Service Charge Representative
John GrayService Charge ConsultantJohn Gray Service Charges LtdDD: 01909 770416Mob: 07730 527861Email: [email protected]
This group is made up of all the
major multiples represented at the
PMA and includes many of the
consultants representing those who
do not employ a specialist direct.
An on-going issue is the reporting
of marketing analysis by Agents and
Landlords of exactly what they are
doing to ensure the monies invested in
Marketing are actually adding sufficient
value. I continually advise agents and
landlords that the issue continues but am
told “nobody else is raising it as an issue” –
the best part of £3m has been
cut off Marketing budgets in the last 2
years because of this initiative and we do need
to keep the pressure on or these costs will
creep back!
We continue to address topical issues such as
the RICS Code of Practice, Benchmarking etc and
our audit programme, the PMA QA Mark continues
to be of interest to Landlords and Agents alike. This
has been developed to include review of actual costs
(but not individual lease compliance) as well as Code
Compliance as we believe this to be more relevant
to retailers focus on costs. Other issues discussed
at recent meeting include the potential impact
of Carbon Reduction Commitment upon Service
Charges, Green Leases, Anti Terrorism measures
and Insurance commissions taken by landlords
when placing with cover recovered through the
service charge.
These pressures on costs are also overlain with the
undeniable fact that the stock of building we all
trade form is getting older, and as such needs more
tlc and MONEY spending on them so we must
ensure that the communication lines are open and
we have the discussions with Landlords and Agents
BEFORE the money is spent so we can perhaps
influence if it is all necessary ‘right now’ or at all!
The Landlord & Tenant forum is set for 26th
September this year after missing last year and is
where landlord and retail representatives meet to
discuss topical subjects without specific axes to
grind continues to provide valuable networking
and communication opportunities and to help
build Landlord relationships. Improving on
communications with landlords and their agents
also continues to be at the forefront of our activities
while keeping a controlling finger on the pulse of
the major overheads of retail property occupancy.
Individual meetings with the major agents are under
way to ensure their compliance with the spirit of The
Code of Practice.
John Gray
John Gray Service Charges Ltd
Service charge committee update
We currently have 104 companies listed as PMA Members. Since July 2011 we have new
members, namely Bestseller Wholesale UK Ltd, Foot Locker Europe JD Sports Fashion plc,
Steinhoff UK Group Property, Super Group plc, The Edinburgh Woollen Mill, The Money
Shop and Waterstones.
PMA Newsletter 2012_V4.indd 10 08/08/2012 11:17
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Tell us your views of the pma and the issues that matter for the retail property industry:
Q1: Is the work of the PMA relevant to you and your business: Currently relevant / active Could be / need more information No
Q2: What is the single most important property issue affecting your business: Rental liability Lease breaks / fl exibility Service charge / running costs Business rates costs Decline of high street & vacancy rates Competition from Internet
Q3: How does your view of the health of the retail property sector compare to 12 months ago: Improving Worsened Static / No improvement
Q4: What one thing should the PMA focus their efforts and resources for retailers?
Q5: Would you like to see more or less events and if so what?
Your name & organisation
Please send all responses to :
The Property Managers Association, Louise Oliver,
The Dolls House, Audley End Business Centre,
Wendens Ambo, Essex, CB114JL
Tel: 01799 544904
Fax: 01799 542991
Email: [email protected]
A short Questionnaire
PMA Events2012Cocktail Party and Fundraising Event
Date: Wednesday 3rd October
Venue: Grace Milk Bar, 42-44 Great
Windmill Street, London W1
Time: 6.30pm onwards
Host: Joint event with SAS
Business Meeting and Buffet Lunch
Date: Wednesday 14th November
Venue: SNR Denton, One Fleet
Place, London EC4
Time: 12.30pm – 3.30pm
Host: SNR Denton
Christmas Lunch and Awards Presentations
Date: Thursday 20th December
Venue: London Hilton Metropole
Time: 12.30pm onwards
Plus Guest Speaker
The PMA are always endeavouring to ensure their efforts are directed towards facilitating their
member’s needs and make the work done relevant and focused.
Feedback is essential and we would be grateful if you could take a few minutes to answer the brief
questions below to assist in our research.
Thank you for completing our Questionnaire
Fundraising for 3 Little Miracles
To book a place click on our website or call Louise Oliver on 01799 544904
propertymanagersassociation.com
PMA Newsletter 2012_V4.indd 11 08/08/2012 11:17
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Some of our members
Protecting retailers occupancy interests through effective co–ordination
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