Like-for-like rental income at shopping centre owner Intu fell 1.5% for the six months to 30 June compared with the first half of 2016, although this was in line with expectations, amid a “challenging retail environment”.
The property group signed 103 long-term leases during the period, 80 in the UK and 23 in Spain, delivering £18m in annual rent at an average of 7% above previous passing rents.
Intu said occupancy remained stable at 95.9% and footfall continued to outperform, as it fell by 0.5% compared with the average 2.7% drop for 2016 reported by footfall-tracking company ShopperTrak.
Intu acquired Madrid Xanadú in March 2017 for €530m (£473m). It now owns three shopping centres in Spain.
CEO David Fischel said: “Intu has performed robustly over the six-month period in a UK retail environment, which continues to be challenging. Retail brands are being selective in their expansion.
“Our £679m UK development programme is progressing on schedule with the £180m Intu Watford extension on target to open in autumn 2018. We expect to start shortly on the £71m Intu Lakeside leisure extension which is more than 90% let to tenants including Nickelodeon, Hollywood Bowl and multiple restaurants.
“We have a clear strategy to deliver long-term value to shareholders and, with cash and available facilities amounting to £920m, we have significant flexibility to pursue opportunities as they arise in the UK and Spain.”