Landsec rent collections continue to improve but retail lags offices
Positive news from retail landlord Landsec continues on the rent collection front. The commercial property giant and joint owner of the Bluewater mall in Kent said Friday that, as of 12 October, 85% of the £89 million net rent due on 29 September had been paid. This compares to an 81% collection rate for the June quarter date.
But it shows retail rent payments in London (80%) and regional retail (83%) are still lagging offices payments (95%). ‘Urban opportunities’ and ‘sub-scale sectors’ were the weakest sectors at 50% and 48% respectively.
Landsec noted that of the £13 million of overall rent outstanding, £5 million relates to customers “who have withheld payment pending documentation of agreed concessions”. In June, those figures stood at £18 million of rent outstanding, and £6 million related to “withheld payments".
Although Landsec gave no further comment, it last noted that the business “continues to take a proactive approach to addressing the challenges the pandemic presents to our people, our customers and our business”.
With the pandemic having caused significant shortfalls in rent gathering in the year to April, property landlords have been forced to cut costs to offset growing debt levels.
Earlier this month, rival Hammerson was reported to be cutting head office staff along with the continued divestment of non-core property portfolio and refinance to offset its massive debt pile.
Last month, Landsec also said it has agreed to sell two retail parks in Cumbria and Blackpool for £54.3 million in a move to help contribute funds to its focus on London projects.
Landsec has previously said it wants to generate capital from this sector of the property market, where it has little or no competitive advantage to rivals.
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