Capital & Regional hails “positive year of progress”

8th March 2024 | Jack Oliver

The chief executive of Capital & Regional has praised a “positive year of progress” for the shopping centre real estate investment trust (REIT) in 2023.

The REIT has originally planned to release its full-year results in early March, however the group’s new auditor Mazars had requested more time to complete its procedures. As a result, a date for Capital & Regional’s full-year results has not been set.

However, providing an update on a number of key metrics, the REIT said it had recorded 86 new lettings and renewals in 2023, compared to 80 in 2022, at a combined average premium of 6.8% to previous rent and 16.6% to estimated rental value.

Footfall at Capital & Regional’s assets increased 1.5% to 44.5 million visits, representing 86.7% of 2019 levels.

The REIT’s occupancy rate declined slightly, from 94.1% at the end of 2022 to 93.4% by the end of 2023. This was partly due to Wilko’s administration in August 2023 leading to the closure of three stores. The vacated stores have since been relet to B&M as part of a portfolio deal signed in February and are due to open in April, representing an increase in occupancy of 140 basis points.

As of the end of 2023, Capital & Regional’s rent collection was 99%, up from 97.6% in 2022.

The REIT recorded a 2.6% increase in like-for-like valuations in 2023, with a 4% increase in the valuation of The Gyle Shopping Centre, Edinburgh since its purchase in August. Total portfolio valuation increased by 15.5% to £372.8m.

Capital & Regional expects to record a adjusted profit of approximately £12.7m in 2023, up from £10.3m in 2022.

Lawrence Hutchings, Capital & Regional chief executive, said: “Our ongoing focus on delivering our proven community centre strategy and increasing our weighting to non-discretionary and needs-based retail and services categories has helped us deliver another positive year of progress.  The acquisition of Gyle in Edinburgh also represented an important milestone in our goal of returning to growth and we are particularly encouraged by the fact that we have already created value in the centre through our leasing programme.

“Consumers are increasingly focused on value for money as well as prioritising spend on non-discretionary items.  Our value-based retailers are responding by expanding their store footprints into the types of well-managed, high footfall centres offering affordable space in urban locations, that make up our portfolio.  This trend is evidenced by the speed at which our team was able to rapidly re-lease all three of our Wilko units to B&M.  It is also supporting our income growth and has underpinned the increase in dividend we have announced today.”


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