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Intu braced for 'challenging' year

Shopping centre owner Intu has said 2019 will be “challenging” in the face of an onslaught of company voluntary arrangements (CVAs) and economic uncertainty. 

In a trading update for the period from 1 January to 2 May, new chief executive Matthew Roberts said: “We expect the remainder of 2019 to be challenging as a result of a higher than expected level of CVAs and a slowdown in new lettings as tenants delay their decisions because of the uncertainties in the current political and retail environments.”

“As such, we have revised our approach to how we guide towards our year-end like-for-like net rental income to factor in expected CVAs and have adjusted our 2019 guidance accordingly to -4% to -6%.”

During the period Intu agreed 53 long-term leases totalling £6m in annual rent and settled 77 rent reviews for new rents totalling £20m. 

Occupancy was 95.6% on 31 March and footfall in the year to date is ”marginally ahead” of the same period in 2018. 

The store closures announced in the Debenhams CVA last week do not affect Intu. Debenhams accounts for 3% of Intu’s rent roll. 

The shopping centre owner is continuing to make disposals and part-disposals as part of its priority to reduce its loan-to-value ratio from 51.3% to below 50%. This includes a possible refinancing of the legacy Intu Trafford Centre debt. 

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