Shaftesbury swings to £287m first half loss as coronavirus hits property value
West End landlord Shaftesbury has swung to a £287m first half loss, as the value of its estate plummeted in the wake of the coronavirus crisis.
The company, which has a portfolio of restaurants, pubs, shops, and workspaces in central London, said that the store closures brought about by the nationwide lockdown had affected tenants’ ability to pay rent.
Shares in the FTSE 250 company rose in early trading as it reassured investors of its portfolio’s “long history of structural resilience”.
The figures
The Chinatown and Carnaby Street landlord Shaftesbury said it made a £287.6m loss in the six months to 31 March, compared to a profit of £38.7m a year earlier.
The value of its property empire decreased 7.9 per cent on a like for like basis, to £3.5bn in the six months to March.
Underlying net property income after Covid-19 provisions was £46.2m.
The company said it aimed to collect around 50 per cent of rents due from April to September 2020 over time.
Why it’s interesting
Shaftesbury said that from October it will now offer monthly, rather than quarterly, rent collections on a permanent basis.
This comes as part of a wider policy of arranging tailored rent solutions for tenants hit especially hard by the coronavirus crisis.
The update comes weeks after rival Covent Garden landlord Capital & Counties (Capco) agreed the purchase of property tycoon Samuel Tak Lee’s stake in Shaftesbury, worth £436m.
The shock move has led to speculation that a merger between the two companies, which have neighbouring estates, could be on the cards.
What Shaftesbury says
Chief executive Brian Bickell said: “Although our business performed well during the first four months of the period, the growing impact of the measures to address the pandemic are having a material impact on normal patterns of life and commerce, both for our occupiers and on the near-term prospects for our business and financial performance.”
“The economies of London and the West End have a long history of structural resilience, having weathered many episodes of near-term challenges and uncertainties. Their unique features come from a culture of constant evolution across a broad-based economy, attracting talent, creativity, innovation and investment from across the world and reinforcing their enduring appeal to businesses, visitors and as great places to live.
“In the post-pandemic recovery, these fundamental advantages will underpin their return to prosperity and growth.”