Intu shares fall after reports that House of Fraser will close some stores
The Guardian reported the tenant would close its stores at certain shopping malls in the UK
Intu’s share price fell 6.3% to R33.75 on Thursday following reports in UK newspapers that a major tenant, House of Fraser, was closing down at four of its malls.
The Guardian reported House of Fraser would close its stores at Intu’s shopping malls in Nottingham, Norwich, Newcastle’s Metro Centre and the Lakeside shopping centre in Thurrock, Essex.
House of Fraser was acquired in August by UK retail tycoon Mike Ashley who told the BBC the department store chain’s woes were due to “greedy landlords”.
“We had multiple meetings with Intu but we were no further forward after 14 weeks. Unfortunately, these stores now face closing in the new year,” Ashley told the Guardian.
“Intu said the closures represent about £4.3m of its rental income and 526,000 square feet of retail space and said it was ‘enthusiastic about the opportunity to re-engineer and re-let this underperforming space to new and exciting alternatives’,” The Guardian reported.
Intu warned in trading update issued on October 23 that the “write-off of balances relating to House of Fraser and Coast” had prompted it to lower its expected rental growth to about zero from 1.5%.