Shaftesbury on speedy road to recovery as business bounce quickens in H2
How’s this for a positive trading statement opening: “Confidence, footfall, trading recovering; rebound in occupier demand driving vacancy down towards pre-pandemic levels; valuation recovery in second half”.
No wonder on Tuesday that London-centric commercial property giant Shaftesbury and its chief executive Brian Bickell were still toasting mid-July's ‘Freedom Day’, when its 600+ hospitality, retail tenants, and businesses across its 16-acre West End portfolio reopened for the first time in 17 months.
“What followed has been a remarkable bounce back in activity, as domestic visitors and workers returned, with footfall and spending in our villages well on the way to returning to, or in some cases already exceeding, their pre-pandemic levels," Bickell said in the report for the full year to 30 September.
He particularly noted “great progress on Shaftesbury's road to recovery in recent months”.
Of course, pandemic restrictions had a material impact on results for its financial year, but trends turned positive over the second half, it said. And valuations also started to also recover in the second half as pandemic uncertainties began to recede.
But property portfolio valuations still declined 5.4% on a like-for-like basis to £3 billion in the 12 months, weighed down by lockdowns and times when rent support was given to some tenants.
The improving trend also showed the loss after tax was reduced to £194.9 million, much improved on the £699.5 million loss recorded in 2020.
Rent collection also showed sustained improvement, it said, and was 75% of the total owed in the final quarter of the year to end September, from 52% in the first nine months.
Shaftesbury also added it had now ended its rental support scheme in all but exceptional cases, reflecting the “swift rebound” in demand for West End space, particularly in Covent Garden, as confidence grows.
Letting activity in the year amounted to £33.9 million with another £6.3 million since 30 September.
The firm also said it was seeing a sustained recovery in footfall, with weekends currently back to 2019 levels and weekdays at 80%.
And on the subject of today’s reintroduction of face-mask-wearing in stores and on public transport, an upbeat Bickell told the Standard newspaper: “Requiring people to wear masks is just a small inconvenience if it means that we can all enjoy the Christmas and New Year that we didn’t have last year.”
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