David Jones entered voluntary administration on 5 November 2026. The directors appointed McGrathNicol as administrators, and the secured lender appointed FTI Consulting as receivers on the same day. Stores and online keep trading while a sale or recapitalisation process begins. This is not a sudden collapse. It is the end of a decade-long slide that began in 2016, when a cost-saving head office move stripped out the people who knew how the business actually worked.
Administration is not a death certificate. Used properly, it is a scalpel. It can close the stores that cannot be saved, draw a line under legacy debts, and hand a smaller David Jones to an owner with a real plan. That plan has to make David Jones something Myer is not: a service-first destination for Australia’s wealthiest and most loyal shoppers.
Where David Jones stands now
The 188-year-old retailer ran out of road. It lost $95.5 million in 2024/25, up from $74 million the year before, and had not paid rent since September. Talks with landlords broke down on 4 November, and the business went into administration and receivership the next morning.
| Pressure point | What has happened |
|---|---|
| Landlords | No rent paid since 30 September. Scentre Group, which hosts 17 of the 38 remaining stores, says Anchorage rejected an offer that would have kept the business trading. Landlords hold $45 million in bank guarantees. |
| Lenders | Hilco Global provided a reported $220 million asset-backed facility in June. A covenant breach followed. In September, Hilco reportedly lined up McGrathNicol and Clifford Chance for insolvency preparations. |
| Suppliers | Payments ran late through 2026. Some suppliers were asked to accept a 20-week repayment plan. Accent Group moved to cash on delivery. Several fashion labels moved to exclusive deals with Myer. |
| Concessions | Country Road Group plans to remove nearly 100 of its 283 concessions from next year. |
| Leadership | Erica Berchtold replaced Scott Fyfe as chief executive in June 2026. |
| Network | Tuggerah and Castle Towers closed in January 2026. |
The appointments on 5 November
| Role | Firm | Appointed by | Job |
|---|---|---|---|
| Receivers | FTI Consulting: Christopher Hill, David McGrath, Joanne Dunn | Secured lender | Control the assets and trade the business while they review it, acting chiefly to recover the secured debt |
| Voluntary administrators | McGrathNicol: Jason Preston, Shaun Fraser, Jacinta Neilsen, Matthew Hutton | Directors | Investigate the company, report to creditors and run the process seeking a recapitalisation or going-concern sale |
The appointments cover ACP Riley Street Midco Pty Ltd, the parent of David Jones Pty Limited, and associated companies, with matching appointments in New Zealand. Chief executive Erica Berchtold says the company has “a well-developed plan on how to reset the business for the future”. The question is no longer whether David Jones restructures, but who ends up owning it and what they turn it into.
The root cause: when bean counters run a department store
One number explains what went wrong at David Jones, and it is not a loss figure. It is 70%: the share of Sydney head office staff who refused to move to Melbourne when Woolworths Holdings relocated the headquarters in 2016–2018. The losses, the finance costs and the late supplier payments are consequences.
In August 2016, Woolworths Holdings announced it would move David Jones’s head office from Sydney, its home since 1838, to a new campus in Richmond, Melbourne. The logic was textbook cost optimisation: co-locate with Country Road Group, share back-office functions, and save $20–30 million a year. Woolworths invested $240 million in the campus and a Truganina distribution centre, and the Victorian Government reportedly covered about half the redundancy costs.
Between 600 and 800 head office staff were offered a move or a redundancy. Woolworths expected 50–60% to go. Only 20–30% did.
The wrong people left
The functions hit hardest were the ones that mattered most. As one company source told the Australian Financial Review: “You can replace property and finance people quite easily but when it comes to marketing and buying, which are more bespoke and harder to fill and have history and intellectual property, they have been unpleasantly surprised by the lack of traction in those two functions.”
That knowledge is a business’s corporate DNA. It is not in the systems, the brand guidelines or the org chart. It is:
- the buyer who can look at six near-identical white shirts and know which one will sell in Bondi Junction but not Chadstone
- the marketing director who can hear when the brand tone is wrong without reading a deck
- the supplier manager who can settle a $2 million rebate dispute in fifteen minutes because she has known the brand for a decade
When those people took redundancy and stayed in Sydney, the knowledge went with them. Many moved into senior roles with David Jones’s own suppliers.
Into Myer’s arms
Myer has been headquartered in Melbourne since 1911. After the move, the two stores competed for the same talent pool as well as the same customers, and David Jones started from a standing start. A buyer hired from Myer brings Myer’s instincts and Myer’s supplier relationships. The Sydney sensibility that had made David Jones distinct faded.
You can restructure a balance sheet in 90 days. You cannot restructure the knowledge inside people’s heads. Lose the people who understand how the business works in practice, and you are not turning it around. You are building a new one under an old name.
A decade of drift
The relocation saved $20–30 million a year. Over the same period, about $1.5 billion of value was destroyed.
| Year | Event | Value |
|---|---|---|
| 2014 | Woolworths Holdings buys David Jones | $2.1 billion |
| 2016 to 2018 | Head office moves to Melbourne; 70% of Sydney staff decline to follow | $20 to $30 million a year saved |
| 2020 | Sydney Elizabeth Street flagship building sold | $510 million |
| 2023 | Business sold to Anchorage Capital Partners, about 75% below book value | About $100 million |
| 2026 | Administrators and receivers appointed | — |
Leadership churned throughout. Paul Zahra, chief executive at the 2014 acquisition and a David Jones veteran of decades, resigned within months citing “significant differences” over strategy. His successors came from Country Road, a different brand with a different customer and culture. Scott Fyfe, who joined in 2020, had to recruit senior talent from overseas because Melbourne’s retail talent pool had Myer written all over it. He was replaced by Erica Berchtold in June 2026.
Stuck in no-man’s-land
The deeper cost was identity. For a decade David Jones has been neither exclusive enough for luxury nor sharp enough for the mass market. Anchorage did not buy a failed business in 2023; it bought a neglected one. Its $250 million transformation was delivered on time and on budget, but it was spread across too many fronts. In a turnaround, breadth is the enemy of depth. When capital is tight, every dollar has to drive toward one clear competitive position.
This is not an Anchorage problem or a chief executive problem. It started in 2016, when someone who understood spreadsheets but not department stores decided that 178 years of accumulated knowledge was worth less than $20 million a year.
Two playbooks, one market
Myer and David Jones trade in the same centres, through the same economy. Myer has a clear strategy; David Jones has not. The gap is not about the environment.
Myer is not immune. It reported a $276.5 million statutory loss for FY26 after writedowns, and underlying EBIT fell 7% to $139.4 million. But it still made an underlying profit of $42.5 million, grew sales to $4.09 billion and paid an interim dividend. David Jones lost $95.5 million on falling sales and could not pay its rent.
| Myer | David Jones | |
|---|---|---|
| Latest result | FY26 underlying NPAT $42.5m; statutory loss $276.5m after writedowns | 2024/25 loss $95.5m; sales down nearly 9% |
| Own product | Owns Just Jeans, Portmans, Dotti, Jacqui E, Sass & Bide, Marcs, David Lawrence | Relies on third-party brands and concessions |
| Customer data | Myer One: 5.1 million active members; nearly 80% of online sales linked to loyalty | Loyalty programme and credit card, without the scale to make the data useful |
| Brand pipeline | 30 new beauty brands in 1H26, including La Mer, Fenty and MAC; 55 fashion brands slated for FY27 | Brands leaving or moving to Myer exclusivity; insurers pulling cover |
| Positioning | Broad platform for aspirational middle Australia, aged 31 to 49 | Unclear: neither luxury nor mass market |
Four things separate them. Myer owns much of its product, so it controls its margin. It knows its customer through loyalty data. Brands want in. And it knows what it is. David Jones has none of these advantages today.
Australia can sustain two department store brands, but only if they are different. Myer has claimed the broad middle. David Jones needs to be something else entirely.
Why voluntary administration could create a better business
The appointment has now happened. The moratorium protects the business from creditors, and the stores keep trading. The opportunity is to use the next 90 days to do what years of piecemeal negotiation could not, walk away from stores that cannot be saved, compromise legacy debts, and hand a smaller, clean business to an owner who will invest in it. That can come through a deed of company arrangement (DOCA) or a going-concern sale. Either works if it delivers the same outcome.
Long moratorium extensions destroy rather than preserve value, the financial metrics are not complicated execution is, and execution can be completed during the Deed period.
The aim is a smaller network of the 13 - 15 stores that can sustain a premium model. With 38 stores trading today, that means a sharply smaller David Jones. Every dollar of new equity and debt then goes into those stores rather than into propping up the rest.
Three creditor pools, each better off than in liquidation
The DOCA should treat creditors in three pools. Each gets a better outcome than liquidation, and a better one than the current drift.
| Ongoing suppliers | Landlords of continuing stores | Landlords of closing stores | |
|---|---|---|---|
| Legacy debt | Pre-administration debts compromised at a discount and paid from the DOCA fund over 6 to 12 months | Rent arrears compromised at an agreed rate in the dollar | Arrears share in the DOCA dividend within 6 to 12 months |
| Going forward | Clean terms. The administrator is personally liable for trading debts during the VA; afterwards, a right-sized business on current terms, with trade credit insurance restored | Lease continues, with room to renegotiate with a tenant that now has a sustainable cost base | The administrator gives notice it will not use the premises; no ongoing rent |
| What they gain | Certainty and a solvent customer that keeps buying | They keep their anchor tenant: no empty box, no $5 to $15 million re-tenanting cost, no 12 to 24 month void | Space back in weeks, ready to re-let or redevelop |
| Versus liquidation | Perhaps 5 cents in the dollar and the loss of a sales channel | An empty anchor, a long void and lost foot traffic for specialty tenants | Months of uncertainty, partial rent and a deteriorating store |
Employees in continuing stores keep their jobs, and their entitlements rank ahead of ordinary creditors.
The 90-day clock
- Day 1. Administrators and receivers appointed (5 November). A moratorium takes effect and all creditor enforcement stops.
- Days 1–8. First creditors’ meeting; a committee of creditors is formed. Continuing stores trade normally. Closing stores begin clearance sales.
- Weeks 2–5. The administrator exits the leases of closing stores and negotiates the DOCA with the committee across all three pools.
- Weeks 5–6. Second creditors’ meeting. The administrator recommends the DOCA, creditors vote, and the deed is signed.
- Weeks 7–12. A clean business emerges with a focused network. Supplier terms reset, brand recruitment begins and flagship investment starts.
- Months 3–12. The DOCA fund pays out, remaining leases are renegotiated and the service-first repositioning rolls out.
The receivership complication
This is not the pre-packaged process we argued for. The secured lender appointed receivers on the same day, so FTI now controls the assets and trades the business. Its first duty is to recover the lender’s debt. The risk is that the quickest recovery becomes a break-up, stock cleared, the best leases sold off and the brand sold on its own.
The case for a whole-of-business deal is that it serves the lender too. A trading David Jones with a focused network and a reset cost base is worth more than its parts, the Mosaic collapse taught us this. Creditors, landlords and the administrators should push for a buyer or recapitalisation that keeps a core of stores open, rather than a fire sale weeks before Christmas.
Where the freed capital goes
We estimate closing the first ten underperforming stores alone removes $80–120 million a year in costs. That money should fund four things:
- Flagships. Full refurbishment of Melbourne Bourke Street, Sydney Elizabeth Street and the Brisbane flagship, with styling suites, personal shopping, and beauty and wellness floors.
- Personal shoppers. Recruit, train and deploy them across the top ten stores, paid on commission and measured on relationships. This is the most distinctive investment David Jones can make.
- Brand recruitment. Clean financials make the business attractive again to luxury and prestige brands.
- Balance sheet repair. After the DOCA, mainstream bank finance can replace distressed-debt facilities. The interest saving alone could pay for the personal shopping programme.
What the new David Jones should become
"Quod facimus, valde facimus - What we do, we do well." (Georges, Collins Street, Melbourne)
I grew up in Melbourne. Every week my grandmother took me to the Regency Tea Room at Georges on Collins Street, after the cinema. You waited at a rope to be seated, and the couches were genuine Regency antiques. She was not a soft woman; she lived to 101. But she had a personal shopper at Buckley’s who knew her and earned her loyalty by getting things right without being asked. When she was in hospital, that shopper sent nightgowns after a single phone call. Years later, she chose my first work suits.
That model did not die because it stopped working. It died because no one fought to keep it.
The customer everyone has forgotten
Australia is ageing, and the over-55s hold much of the nation’s wealth. Many own their homes outright and have disposable income younger Australians can only dream of. They remember what good retail felt like: not scrolling an app, but being known and looked after. Myer is chasing 31-to-49-year-olds. The wealthiest, most loyal shoppers in the country are being left on the table.
The model
- Real personal shoppers. A named person who knows you, with permission to care, not a CRM entry.
- Fewer stores, higher standards. Fifteen to twenty stores done properly will outperform forty mediocre ones. Closures are not defeats.
- Stores worth visiting. Georges had its tea room; it was the reason people came. Styling suites, beauty clinics, wine bars and private dining play that role today.
- Health and wellness. A curated floor of premium skincare, optical and audiology. If Mecca can make Bourke Street a destination, so can David Jones.
- Technology that serves the relationship. Appointment booking, messaging with your personal shopper and white-glove delivery, not an app for its own sake.
It has worked before
Nordstrom was built on service. The Nordstrom family took it private in a $6.25 billion deal completed in May 2025 to invest for the long term. In Japan, Isetan and Takashimaya became cultural destinations. Selfridges reinvented itself around dining, art and wellness. Melbourne had its own proof: Georges traded for 115 years on this philosophy, and its staff handbook told employees to avoid high-pressure selling. It closed in 1995 under David Jones ownership. The model did not fail; the owner failed the model.
This is also how the business rebuilds the corporate DNA it lost in 2016. A service-first store is run by people with deep product and customer knowledge, and it rewards them for staying.
A scalpel, not a death certificate
David Jones has Buckley’s chance of surviving as a conventional department store. As a smaller, service-first destination for Australia’s most valuable customers, it is a business worth building, and administration is the fastest way to get there.
Three things have to happen. Pick a lane and invest only in the stores that can deliver it. Start with the customer, asking what she wants when she walks in, not which brands can be stocked. And file the accounts and pay the bills, because no strategy works when suppliers do not trust you.
Ongoing suppliers get certainty. Continuing landlords keep their anchor. Exiting landlords get their space back fast. Staff in continuing stores keep their jobs. And a 188-year-old business gets the chance to become what it should have been all along.
Ninety days. Three creditor pools. One clean outcome.
Olvera Advisors is a leading Deed Advocate and advisory firm. If you are a supplier to David Jones and need assistance contact us today or go to our David Jones Supplier Retail Portal.
Sources
- Ragtrader, Official: David Jones enters administration, 5 November 2026
- Inside Retail, David Jones collapse imminent after landlord talks break down, 4 November 2026
- AAP via The Border Mail, Behind on rent, David Jones teeters on edge of collapse, 4 November 2026
- Inside Retail, Is David Jones really on the brink? What we know so far, 27 October 2026
- FashionUnited, Myer reports $276.5 million statutory net loss for FY26, 23 September 2026
- Olvera, The David Jones Files, four-part series
