Capital & Regional NAV dips 4.5%

Capital & Regional’s net asset value dropped by 4.5% to £855.3m in the second half of 2018. In a trading update, the shopping centre REIT attributed the decline to “negative sentiment towards retail assets”. Shopping centres outside of London saw a net decrease in value of 10.1%, while the REIT’s three London assets increased by 1.1%. The loss also included impacts from the restructuring of Capital & Regional’s Redditch joint venture and a write down following the deferred consideration on its Ipswitch disposal at around £46m, equivalent to 6.4p of NAV per share, compared to 66p at 30 June 2018. The REIT said it had an “ongoing dialogue” with Debenhams and was “advancing plans for the right sizing of some stores”. Debenhams pays an average rent of £8.64 per sq ft on units in three of Capital & Regional’s seven wholly owned assets, with 340,000 sq ft representing 5.8% of its income. Chief executive Lawrence Hutchings said: “We have achieved positive operating metrics in leasing, footfall and income and, notably, these are strongest where we are most progressed in delivering our needs-focused community shopping centres strategy.” Capital & Regional reported NRI for 2018 in line with 2017, despite 20 CVAs and retailer restructurings, which impacted NRI by around £1.5m over the year. It had 87 leasing transactions with an average premium of 3.1% to passing rent and 1.5% to ERV. Occupancy increased to 97.0% at 31 December 3018 and footfall across the wholly owned portfolio increased by 0.7% in the second half of 2018. Footfall for 2018 was up by 1.2% on a like-for-like basis, compared to the national index decline of 3.5%. To send feedback, e-mail emma.rosser@egi.co.uk or tweet @EmmaARosser or @estatesgazette