Shopping at retail parks near pre-Covid levels, says British Land
Meadowhall and Broadgate owner says rent collection has improved since lockdown eased
Last modified on Tue 13 Jul 2021 03.39 EDT
British Land, owner of shopping centres including Sheffield’s Meadowhall and Broadgate in London, said trading at its out-of-town retail parks was almost back at pre-pandemic levels, as rent collection improved across its portfolio.
The company, one of Britain’s biggest commercial property owners, is betting on open-air retail parks that are accessible by car to lead the recovery, as Covid lockdown measures are eased.
Footfall and sales at its retail parks were at 96% and 99% of pre-pandemic levels between 17 May and 3 July. At covered shopping malls, footfall and sales were 75% and 89% of 2019 levels.
British Land is on the lookout for more retail parks and has just acquired one at Thurrock in Essex, just off the M25, for £82m.
It said retail park values were starting to rise, up 0.7% in the quarter to June. Retail parks make up just over half of the group’s assets. Retailers at Thurrock include Decathlon, Adidas, Nike, TK Maxx, Boots and Pets at Home.
Restaurants in British Land malls and retail parks have recovered strongly since the reopening in the spring, with sales up 6% compared with 2019 levels. Among retailers, jewellery, accessories, childrenswear, furniture and homewares, along with convenience stores, have performed well.
British Land, which slashed the value of its property portfolio by almost £1bn as rents fell sharply during the pandemic, has so far collected 85% of the £87m of rent due in the June quarter, up from 72% in the December quarter. After further payments in recent weeks, it has received 91% of the rent due in the March quarter, with 99% received for offices and 85% for retail.
Simon Carter, the British Land chief executive, 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 … and there are indications that retail park values are starting to rise as more investors target the market. At Storey, our flexible workspace offer, activity is above pre-pandemic levels.”
He said demand for refurbished space had increased and recent lettings included a deal with Neat Burger, a plant-based restaurant backed by the racing driver Lewis Hamilton, at 155 Bishopsgate in the City of London.
The developer has three campuses with offices, restaurants and shops at Broadgate, Paddington Central and Regent’s Place in London, and is building a fourth at Canada Water over 21 hectares (53 acres).
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