Major landlords take £2.7 billion hit as CVAs erode retail property value

The UK’s biggest shopping centre owners have taken a hit worth £2.7 billion in the last year as high street chains struggle, new figures have shown.

Major retail landlords have been forced to make £2.7 billion in write-downs on the value of their properties, compared with just £232 million the year before, according to Growthdeck Property’s investment arm.

It comes as companies such as Arcadia, New Look and Debenhams slim down their store estates and ask for rent reductions in order to continue trading.

Several of the biggest property owners in the UK have found the value of their prized assets dwindling, as even household name shops become less reliable sources of income.

However Michael Ross, property director at Growthdeck Property, said some operators are still defying the gloom.

“A blanket devaluation of retail properties means that there could be hidden gems if investors know where to look,” he said.

“Not all occupiers are financially equal.”

Intu, owner of Manchester’s Trafford Centre, reported write-downs of £1.3 billion last year, while Meadowhall owner British Land took a hit of £620 million.

Bluewater owner Land Securities was another victim of the retail crisis, writing down £422 million.

Discontent has been growing among landlords, with the proceedings of a company voluntary arrangement (CVA) meeting for Sir Philip Green’s retail empire postponed last month due to a lack of support for the proposals.

The plans were eventually passed, but only after the terms of rent reductions were changed to soften the blow for shop owners.

Monsoon is the next business planning to restructure its estate, calling for rent reductions on 135 of 258 sites.

The meeting will take place this week for creditors to vote on the proposals.

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