Trading update reveals strong performance at Capital & Regional
Capital & Regional reported occupancy increased across its portfolio from 96.9% at 30 June 2018 to 97.0% at 31 December 2018. And in the same period footfall increased by 0.7% outperforming the national index which was down by 3.7%.
C&R said the strongest performance was at centres where we are most advanced in delivering its refreshment strategy. Footfall for the whole of 2018 increased by 1.2% on a like-for-like basis across the wholly owned portfolio, compared to the national index decline of 3.5%.
Group net rental income for 2018 is expected to be in line with 2017 despite 20 CVAs and retailer restructurings which have impacted NRI by approximately £1.5m over the whole year. 87 leasing were transactions completed in 2018 at an average premium of 3.1% to previous passing rent and 1.5% to ERV, comprising 42 new lettings and 45 renewals totalling a combined £5.5m in annual income.
However the REITs valuers were less impressed by the results and the valuation of the wholly owned portfolio, net of £11.6 million in capex spend, decreased by 4.5% in the second half of the year to £855.3m driven by negative sentiment towards retail assets. While the centres outside London saw a net decrease of 10.1%, the three London assets increased by 1.1%, driven by income growth.
CEO Lawrence Hutchings said: “We have again delivered a robust performance for the second half of the year, against a difficult operating environment in the UK. Our assets are located in some of the highest population growth areas, principally in London and the South East and benefit from excellent public transport connectivity. We have achieved positive operating metrics in leasing, footfall and income and, notably, these are strongest where we are most progressed in delivering our ‘needs’ focussed community shopping centres strategy. This is encouraging and reinforces the quality of our portfolio and strength of our management platform.”
