A third of Western Australia's House stores have been placed into the hands of administrators as the downturn in retail spending hits specialty stores.
Accountancy and insolvency group HLB Mann Judd was placed in control of the Lumbers Family Trust today, which formerly traded as House Karrinyup, House Whitfords City and House Lakeside Joondalup.
HLB Mann Judd was also appointed administrators of private company AJA Riverview, which operated the House stores at Armadale and Carousel.
The franchise agreements were terminated when administrators were appointed, effectively closing the stores immediately.
Whether the stores are opened again is up to the parent company behind the franchise, specialist retail industry group Global Retail Brands, which was not available for comment at time of publication.
Administrators from HLB Mann Judd will meet creditors to resolve the future direction of the Lumbers Family Trust on May 30.
HLB Mann Judd senior Greg Quin said the collapses were unrelated and were not a reflection of the overall strength of the House franchise, which operated in 15 locations across Western Australia before today.
He said the collapses were simply symptomatic of the struggling retail sector.
"It's just the trend in retail at the moment," Mr Quin said.
"Times are tough, people aren't spending money like they used to.
"(The franchisees) experienced downturns in income, rents stayed the same, royalties as per the franchise agreement stayed the same and eventually they ran out of puff."
Mr Quin said the majority of insolvency enquiries in the retail sector were coming from discretionary spending areas.
"People can maybe do without it, so they're just not buying at the moment," he said.
