Commercial Property

Shopping centre owner sees rental income drop by two-thirds

Part-owner of Dundrum Town Centre, Ilac and Pavilions says only 37% of UK rents paid

A deserted shopping centre in the UK. UK prime minister Boris Johnson last week ordered all non-essential shops across the country to close their doors to customers.

Mon Mar 30 2020 - 18:31

Almost two-thirds of the rent that shopping centre owner Hammerson was hoping to see in its bank account last week has not materialised, the business said as shops around the country close their doors.

The British retail property owner, which part-owns the Dundrum Town Centre, the Ilac Centre in Dublin and the Pavilions in Swords, revealed that by Friday, two days after deadline, it had only been paid 37 per cent of the rent that was billed in the UK for the second quarter of the financial year.

After stripping out rent that has been waived, deferred or switched to monthly payments, the figure climbs to 57per cent of what was due.

Hammerson expects to collect more money as it puts more temporary agreements in place.

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UK prime minister Boris Johnson last week ordered all non-essential shops across the country to close their doors to customers.

In Ireland, its flagship sites have been closed since March 25th, apart from essential stores which make up about 8 per cent of its passing rent in the Republic.

In France, the FTSE 250 firm has offered temporary monthly rent deals to tenants.

The board scrapped shareholders’ dividend and withdrew its guidance for the financial year, saying it was too early to tell what the impact of Covid-19 might be.

Last week, rival Intu, owner of Manchester’s Trafford Centre, revealed that it had only received 29 per cent of the rent payments that were due on Wednesday, the deadline for the second quarter.

On Monday, Hammerson said: “In these circumstances, we believe we should support our occupiers, particularly smaller and independent brands that are less resilient to the closure of their space in our centres.

“We have received a variety of requests for rent deferrals, monthly payments and waivers, which we are reviewing on a case-by-case basis, taking into account the business model and risk profile of the occupier, alongside the aid made available by the relevant governments.” – PA

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