Hammerson expects rent collection to improve as UK restrictions are eased
The mall owner says about 40% or R359m worth of rent has been collected
Hammerson, one of the largest UK mall owners, said on Tuesday it was able to collect just more than a third of its rent from tenants in the second quarter of its 2021 financial year, signalling what could be another trying year for property landlords.
Even so, 2021 will likely be better than 2020, when the fallout of Covid-19 turned the industry on its head, hitting property values and rental income.
About 40% or £17.9m (R359m) worth of rent has been collected so far, the company said in a statement. Tenants are required to pay a total of £54.5m in the three months to June 2021.
Hammerson, which also owns shopping centres in France and Ireland, expects rental collections to improve as the year progresses as wider rollout of Covid-19 vaccines will enable the easing of government-imposed restrictions.
A week ago, the UK allowed the reopening of non-essential retail and dining, which bodes well for tenants and landlords. However, restrictions to retail and hospitality remain in place in Ireland, Scotland and across Europe, with a national lockdown in place in France.
The UK collected 48% of the rent due for the second quarter, France 23%, and Ireland 34%, according to the operational update.
Hammerson, which is listed on the JSE, is trying to recover from the consequences of the pandemic, which saw it make provisions for bad debts, covering tenants that struggled to meet their rental commitments in the 2020 financial year.
The share price was down 2.94% to R7.34 as of 10.45am on Tuesday, its biggest one-day drop in about a week, giving Hammerson a market value of R31.8bn.
Separately, Hammerson announced the appointment of Himanshu Raja as new CFO, replacing James Lenton, who resigned in January. Raja, a chartered accountant, will assume his role on April 26.
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