Landsec anger over 'late notice' retail CVAs

The boss of the UK’s biggest listed property company said the landlord will not help rescue troubled retailers by supporting CVAs issued at short notice.

Landsec owns shopping centres including Bluewater in Kent, Westgate Oxford and Trinity Leeds in the UK. This year, it has seen tenants such as the retailer Arcadia issue company voluntary arrangements (CVA) to get out of paying agreed rents.

Landsec has recorded a pre-tax loss of £147 mln (€147 mln), way down on a £42 mln (€49 mln) profit 12 months previously.

Robert Noel, Landsec’s chief executive said: ‘If CVAs are manifestly unfair and not transparent we will not support them. Retailers need to engage with all creditors on equal footing.’

Noel spoke of tenants providing Landsec with only 24 hours’ notice to accept a CVA.

Despite the dent in Landsec’s performance caused by the retail sector’s woes, Noel was bullish about the firm’s prospects. Footfall at Bluewater shopping centre rose 2.5 per cent, while major clothing brands H&M and Zara have started renting more space in shopping centres.

‘With a general election next month and the UK's proposed exit from the EU further delayed, we remain alert to market risks,' he said.

‘However, Landsec enters the next six months with confidence; we're in a strong financial position, have an exciting development pipeline and are agile enough to seize value-creating opportunities as we see them.

‘Landsec had a good first half, delivering resilient results in unsettled market conditions.’

Landsec announced plans to invest up to £3 bn (€3.5 bn) – mainly in London office. If market conditions are favourable, up to 800,000 sqm (74,000 m2) could begin construction next year.

‘We have made excellent progress on our £3bn pipeline of development opportunities, with one million sq ft now on site, said Noel. 'Our new products, Myo and Fitted, have landed well with customers. We have been proactive in the tough retail market, maintaining high occupancy and protecting income.’

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