Town centres across Britain face losing their car parks as administrators threaten to abandon sites after the collapse of NCP.
The sudden closure of National Car Parks, which is the biggest operator of car parks in the country, saw the business abruptly become insolvent earlier this month.
Landlords for the company’s facilities have now been told their bays could be shut down, if they do not accept lower rents while the firm is steered out of hardship.
It is understood up to 20 car parks have already closed and been left effectively abandoned, across locations including Birmingham, Leicester, London and Luton.
Communities nationwide are now braced for dozens more of NCP’s 318 sites to meet the same fate, according to The Telegraph.
Such a development threatens to leave countless landlords out of pocket – and slash the number of shoppers descending on local high streets nearby.
It could also see councils lose millions of pounds in business rates, as unoccupied buildings owned by a firm in administration are usually exempt from the tax.
Insolvency experts at PwC and CBRE are currently scrambling to save NCP – and their battle began by scrapping loss-making car parks across its portfolio.
The administrators have threatened to close more sites and are now also seeking a buyer for the business.
But their attempts to rescue the firm have hit a wall amid tensions with landlords, some of whom have been asked to cut their rents by more than half.
A four-week rent waiver has also been requested to help stabilise the company after its sudden descent into insolvency.
Landlords have been given just days to agree to new terms, with one claiming they were given 24 hours’ notice of the changes and told to accept or immediately close.
‘We view these last-minute bullying tactics as the lowest form of negotiation and are not prepared to do business with people who behave in this manner,’ they said.
Another claimed they were not even informed their site had been shut down.
City lawyers have already been in contact with landlords in case of potential legal action, as some consider whether to attempt to reclaim their car parks from NCP.
Concerns have also been raised by councils that the abrupt closure of bays nationwide could see the empty sites become a hotspot for anti-social behaviour.
Some officials have emailed landlords already to ask what security measures could be put in place to fend off any such disruption.
Already cash-strapped local authorities have also been left fearing they could be forced to foot the bill alone for reopening car parks to support local businesses.
The developments are certain to trigger scrutiny of NCP’s former Japanese owner, Park24.
The private equity firm has blamed a mixture of the Covid-19 pandemic, high rents and increased energy costs for the closure of the car park operator.
But insolvency experts have said the company was scuppered after ‘significant rent payments’ were suddenly due.
PwC said the business ‘deteriorated over a number of years post Covid-19 as demand for parking has not recovered to historic levels, particularly across city-centre and commuter locations’.
It added: ‘Continued shifts in commuting and customer driving patterns have impacted site occupancy, while the high concentration of long-term, inflexible leases has meant the Company has been unable to reduce costs in line with revenue or to exit loss-making sites, resulting in ongoing trading losses.
‘The Company now has insufficient cash available to meet its financial obligations and the Directors have therefore taken the decision to appoint administrators.’
NCP has also cited higher energy prices since Russia invaded Ukraine in 2022.
City sources, meanwhile, have pointed to high borrowing across the business, with the firm’s total debt skyrocketing to £350million by the end of last year.
They have also, however, noted surprise at NCP’s closure, as its high prices and limited overheads should theoretically have ensured its stability.
For instance, the operator charges drivers as much as £60 to park for a day in central London.
Administrators said this week they are still working to sell some or all of the business, which was founded in 1931, before merging with rival Central Car Parks in 1959.
A spokesman for the insolvency experts said: ‘A small number of commercially unviable sites have closed this week and while no other closures are currently planned, the administrators are engaging with key stakeholders, including landlords of some sites, to reach agreements that will allow for their continued operation.’
NCP turned over £187million for the financial year ending 2023, a 7.15 per cent drop from the previous year.
But it also recorded losses of almost £27.5million in 2022 and £26.7million in 2023.
In 2024, Bolton Council wrote off almost £1.5million in debts owed by the company from during the pandemic.
The firm has also been frequently criticised for levying overzealous fines.
Last month, NCP apologised and quashed all incorrectly applied fines after a grandfather was incorrectly asked to pay a £100 penalty charge for a 14-minute stay.
Signs at the car park in Darlington, County Durham, stated parking was free for customers for 90 minutes.
