13th Jul 2021 09:25
(Alliance News) - British Land Co PLC reported a "strong operational performance" on Tuesday, with rent collection rising and retail demand reviving in its quarter since June 24.
The London-based property investor said its office campus lettings and retail portfolio performed well, both during and since its quarter from March 25 to June 23.
The firm noted 183,000 square feet of London-focused office campus lettings in the earlier quarter, with an additional 419,000 square feet now under offer.
In April alone, British Land agreed to let 1134,000 square feet at 1 Broadgate to Chicago-based real estate services company, JLL.
Chief Executive Simon Carter noted: "On our campuses, we see good occupier interest for new and refurbished space, which we expect to be supportive of office rents and values as we move through the year."
Meanwhile, across the company's retail portfolio, footfall hit 86% and sales 94% of pre-pandemic levels in the seven weeks since indoor hospitality reopened on May 17.
Retail parks continue to outperform the wider marketplace with footfall and sales at 96% and 99% of pre-pandemic levels respectively.
Carter said: "With lockdown restrictions lifting, we have seen a notable improvement in activity across our markets and our business is performing well. On our retail parks, footfall and sales are close to pre pandemic levels, rents are stabilising with recent deals in line with March [estimated rental value] and there are indications that retail park values are starting to rise as more investors target the market."
Progress in the company's March and June quarter rent collection continues, even as retail rents continue to lag behind offices.
Between June 24 and July 8, British Land said it has received GBP74.0 million in rent, collecting 85% of the GBP87 million due in the period.
In that period, office tenants paid 99% of the GBP44 million owed, whilst retail renters paid only 71% of GBP43 million owed, constituting the majority of the quarter's shortfall to date.
Despite falling behind office rentals, British Land noted that retail collection was 24 percentage points ahead of rent collection at the same point for the December quarter and 17 points ahead of the March quarter.
Collections for rent owed in the March quarter hit GBP105.6 million. British Land said it has collected 91% of the GBP116 million in rent due from March 25 to June 23, including 99% of GBP49 million in office rent and 85% of GBP67 million in retail rent.
With regard to rent concessions in the coming year, the firm added that: "Where appropriate, we have agreed pragmatic and equitable solutions for the periods of closure, which include monthly payments and concessions. However, with trading restrictions substantially lifted and the vast majority of our customers trading well and paying the rent due, we do not expect to make further concessions this quarter."
Shares in British Land were trading up 0.5% at 522.20 pence each in London on Tuesday morning.
By Scarlett Butler; [email protected]
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