UK REIT Land Securities said on Thursday that it has established a rent relief support fund of £80 mln (€100 mln) to help its customers most in need, with a particular focus on supporting F&B clients and small and medium sized businesses.
Around £15 mln of this fund will support the company's F&B customers, broadly equivalent to three months’ rent free. The remaining £65 mln will be allocated on a case by case basis to small and medium sized businesses with a focus on helping those with limited access to other sources of financial assistance.
The group, which owns and manages commercial property across the UK comprising offices (50%), retail (38%), and leisure and hotel assets (12%), said that the rapid spread of coronavirus has resulted in ‘a huge shift’ in the use of its buildings.
From 24 March, stores at LandSec’s shopping centres, outlets and leisure assets were substantially closed, following new containment measures issued by the government.
‘We have been informed by Accor that they have closed 15 of their 21 hotels in our portfolio,’ LandSec added.
The company said that it has collected 65% of the rent due by 31 March compared with 96% for the equivalent period last year. Rent deferrals have been agreed with many of its retail and leisure occupiers.
‘We are taking measures to reduce expenditure as far as possible at our operating assets and reviewing the timing of further commitment to expenditure in our development programme,’ LandSec said.
The company, which has a LTV ratio of just 28% and as much as £1.2 bn in cash, has cancelled its third interim dividend due to be paid on 9 April 2020.
Interim Chief Executive Martin Greenslade said these are unprecedented times. ‘Landsec is in a robust financial position with £1.2 bn of cash and available facilities and no bond debt or bank facilities maturing before September 2023.
'However, the impact of Covid-19 on our business and on market conditions continues to evolve. As a result, the Board has taken a prudent decision to cancel our third interim dividend due for payment on 9 April and will regularly review the position on future dividends as the situation develops.’