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Commercial Property News
Capital & Regional survive 2009 with a reduced loss of £113 million
The impact on valuations of improving property market sentiment has enabled Capital & Regional to return to profitability in the second half of 2009. The full year pre-tax loss result of £113 million for 2009 bears the hallmark of the first half when net assets fell £135 million, while in H2 they increased by £79 million. The Group had made a pre-tax loss in 2008 of £516 million.
Basic NAV per share is £0.37 on a triple net basis, down from £1.33 (restated) at December 2008.
After a year in which the survival of the Group was in question, Tom Chandos, Chairman said
"The Capital Raising completed in September and the agreed changes to the Group's banking arrangements have contributed materially to improving Capital & Regional's financial resilience. Whilst the Board is by no means complacent about the challenges ahead, these two events undoubtedly marked a turning point for the Group and its prospects."
The three UK funds have experienced peak to trough falls in property valuations (reached in the second and third quarters of 2009) ranging from 39% for X-Leisure to 52% and 54% respectively for The Junction and The Mall. Recovery from these low levels has been most pronounced in retail warehousing, up by 12% from the trough in June 2009. Shopping centre valuations improved in the final quarter of the year while leisure valuations have lagged behind retail, though they have shown improvement in the first two months of 2010.
Occupancy levels fell in the first two quarters but recovered in the second half of 2009 so that across the three funds at the year end, occupancy was 94.6% compared to 94.2% at the end of 2008. Demand for vacant space has nevertheless been weak throughout the year, which has put downward pressure on ERVs. Our main objective has been income protection while seeking long-term solutions to voids caused by administrations.
Temporary lettings, which are less than one year in duration, have proved a useful means of maintaining occupancy and covering void costs while providing flexibility for longer term solutions to be found.
The Group will make no dividend payments relative to FY 2009.
Basic NAV per share is £0.37 on a triple net basis, down from £1.33 (restated) at December 2008.
After a year in which the survival of the Group was in question, Tom Chandos, Chairman said
"The Capital Raising completed in September and the agreed changes to the Group's banking arrangements have contributed materially to improving Capital & Regional's financial resilience. Whilst the Board is by no means complacent about the challenges ahead, these two events undoubtedly marked a turning point for the Group and its prospects."
The three UK funds have experienced peak to trough falls in property valuations (reached in the second and third quarters of 2009) ranging from 39% for X-Leisure to 52% and 54% respectively for The Junction and The Mall. Recovery from these low levels has been most pronounced in retail warehousing, up by 12% from the trough in June 2009. Shopping centre valuations improved in the final quarter of the year while leisure valuations have lagged behind retail, though they have shown improvement in the first two months of 2010.
Occupancy levels fell in the first two quarters but recovered in the second half of 2009 so that across the three funds at the year end, occupancy was 94.6% compared to 94.2% at the end of 2008. Demand for vacant space has nevertheless been weak throughout the year, which has put downward pressure on ERVs. Our main objective has been income protection while seeking long-term solutions to voids caused by administrations.
Temporary lettings, which are less than one year in duration, have proved a useful means of maintaining occupancy and covering void costs while providing flexibility for longer term solutions to be found.
The Group will make no dividend payments relative to FY 2009.
Thu, 18th Mar 2010