Shopping centre REIT Hammerson cancels dividend amid rent shortfall

UK shopping centre operator Hammerson PLC has cancelled its dividend after collecting only 37% of due rent last week, due to Covid-19 crisis.

In a sign of the disruption which coronavirus is having upon the retail sector, tenant businesses in the company’s flagship sites paid just 35% of the total rent due.

A mere 4% of Hammerson’s tenants are classified as ‘essential’ by the UK government, with permission to keep trading while stringent lockdown measures are in force.

Management are reviewing on a case-by-case basis a slew of requests from tenants for deferrals or waivers, the company said.

A Hammerson spokesperson said: ‘This is clearly a challenging and uncertain environment, but HMSO has performed better than peers (INTU was at 29% of rent collected when it updated on Thursday last week) in respect of collecting rent and the wider geographical exposure of its portfolio will also help on this front.

‘The cut to the dividend is not surprising as it conserves liquidity and HMSO has the flexibility to do this for a period while remaining in compliance with REIT legislation. All issued guidance has been pulled as a significant degree of uncertainty remains as to the impact of this crisis on earnings, net assets and cash-flow.’

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