Intu Properties sees signs of recovery in UK

Posted On Wednesday, 06 November 2013 13:25 Published by
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Intu Properties continues to see signs of recovery in the UK economy with a series of positive retail sales figures and improved consumer sentiment.

David FischelUK-based Intu Properties (ITU) continues to see signs of recovery in the UK economy with a series of positive retail sales figures and improved consumer sentiment‚ the JSE-listed property company said on Tuesday

Intu said in its interim management statement for the period from July 1 to November 5 that its occupancy rates for the quarter ended September remained unchanged at 95% by rent‚ including 1% of rent currently being traded by administrators.

Intu‚ which was formerly Capital Shopping Centres and which owns some of the UK’s largest malls‚ said there had been no significant tenant failures in the quarter ended September.

The company‚ which is also listed in London‚ recently introduced a nationwide consumer-facing shopping centre brand‚ also under the name Intu. It has also launched a single transactional website for its centres and is rolling out free Wi-Fi in its malls.

Intu said it signed 57 long-term leases in the quarter — in aggregate £11m of annual rent and 8% above previous passing rent. This brought the total for the year to date to 152 leases‚ producing £33m of new annual rent‚ 4% above previous passing rent.

Five significant transactions were signed in the period to introduce flagship retailers with a view to improving the rental tone over the medium term. Excluding these strategic transactions‚ in aggregate new long-term leases were in line with valuation assumptions‚ it said.

The group said wide-ranging change in the company continued in the third quarter as it rolled out its new brand and progressed its active asset management and development pipeline.

CE David Fischel said the group continued to drive its £1bn development programme. In July it raised about £170m of new financing facilities to help fund the expenditure.

The UK retail environment had continued its gradual recovery‚ with statistics showing a 15-month unbroken trend of increasing like-for-like nonfood retail sales‚ Intu said.

It said 48 new shops had opened in its centres since June and 125 so far this year‚ which represented about 5% of its 2‚600 units. Thirty stores were undergoing shop fitting.

The 2% reduction in footfall it experienced this year was unchanged from June.

The group was encouraged by the continuing signs of improvement in the UK consumer environment.

“We are confident that the income forgone in the short term by our approach of holding units vacant or on flexible terms to enable a timely start on a number of projects within our £1bn development programme will be more than offset by the significant enhancement to the long-term total return of the business from these projects.”

Last modified on Wednesday, 06 November 2013 13:56

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