Landsec, owner of shopping centres including Trinity Leeds and Portsmouth’s Gunwharf Quays, has announced a loss before tax of £147m for the six months to 30 September 2019.
The property company made a £42m profit in the same period last year.
The losses were driven by a writedown of Landsec’s portfolio. The value of its shopping centres declined 9.4% to £1.9bn and retail park valuations fell by 11.1% to £523m.
Revenue profit for the period edged up by 0.4% to £225m compared with the same period last year.
Chief executive Robert Neil remained positive, noting that the business had remained “proactive” in a tough trading environment, and had maintained a high occupancy rate for the period – the retail vacancy rate was reduced to 3.6% from 4% in the same period last year.
However, he also cautioned that times would remain tough for the business: “With a general election next month and the UK’s proposed exit from the European Union further delayed, we remain alert to market risks.”
He also flagged that the changing rental landscape was a challenge.
“Rental values have risen modestly while capital values remain broadly unchanged,” he said. “The retail market continues to be challenged as retailers adapt to structural change, rising costs and a more cautious consumer, with a number of high-profile company voluntary arrangements and administrations during the period.”
Landsec has pledged to become a carbon-neutral business by 2030, and its first net carbon-neutral building project is currently under way on Sumner Street in London.
The company also has a £3bn of pipeline opportunities, 3.5m sq ft of which is in London.