Redefine feels the pressure from UK austerity cutbacks

Posted On Tuesday, 23 August 2011 02:00 Published by eProp Commercial Property News
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Redefine says that the implementation of the UK government’s comprehensive spending review and weak occupier demand have placed increased risk on lease renewals and relettings.

Greg ClarkeJSE-listed Redefine Properties International said last week that the implementation of the UK government’s comprehensive spending review and generally weak occupier demand in most regional centres had placed increased risk on lease renewals and relettings.

The company, which holds as its sole asset a controlling stake of 81,5% in Redefine International plc, said occupier and investment demand for regional office assets was likely to remain subdued with pressures on public-sector budgets and individuals’ disposable incomes set to last.

Redefine said the focus remained on protecting occupancy and rental income and repositioning assets with better alternative uses, or disposing of those assets that have limited growth potential.

The merger with Wichford is expected to enhance Redefine’s ability to support the strategy with a larger, well-diversified asset base and the support and capital commitment from its largest shareholder. All of the resolutions in connection with the merger that were proposed at the extraordinary general meeting held on August 4 were passed without amendment by the required majority.

“I am pleased that shareholders have voted in support of the merger with Redefine. Following a detailed strategic review, the board believes the merger will create an enlarged, income-focused property company with a diversified property portfolio and an improved capital structure,” said Wichford chairman Philippe de Nicolay.

Mr de Nicolay said the merger included a significant capital commitment from Redefine Properties International reflecting its support for the enlarged company.

Redefine said it remained on track to submit a full planning application for a residential mixed-use scheme on the former customs service-occupied site. Discussions with the London borough of Harrow and Design for London were progressing in line with expectations.

Redefine is cancelling its admission to trading on the London Stock Exchange’s Alternative Investment Market. The cancellation is expected to become effective on September 8. The company is moving to the London Stock Exchange’s main board today.

The company has returned to profitability for the first time since the 2008 credit crisis, bolstered by rental income on several acquisitions and tight cost control.

Last modified on Friday, 15 November 2013 11:21

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