Intu cuts rental FY rental estimates after tenant failures

Shopping centre owner Intu Properties, which is mulling a £2.8bn takeover offer, on Tuesday cut its full year like-for-like net rental income growth forecast, citing tenant failures.

Full year net rental income was now expected to be flat to growth of 1% down from July estimates of 1.5% - 2.5% growth, Intu said, adding that 2019 rental income growth would be around 1%.

“Tenant administrations in the period, in particular the write-off of balances relating to House of Fraser and Coast, have resulted in a reduction from previous guidance,” Intu said.

“Currently, 3% of our rent roll is from tenants who have entered a company voluntary arrangement or administration process in 2018.”

Intu said occupancy rose by 0.4%to 97% per cent since July 1, with 84 new long-term leases signed at rent levels 8% above previous passing rent.

Intu last Friday said that a consortium led by deputy chairman John Whittaker’s Peel Group, the Canadian asset manager Brookfield and Saudi Arabia’s Olayan Group had made a proposed offer of 215p a share before dividend payments.

Peel already owns about 26% of Intu and Olayan Group 3%.