MARKET REPORT: West End landlord Shaftesbury rocked as coronavirus crisis crunches property values by £300m
Shares in Shaftesbury tumbled after the West End landlord reported a £287million loss.
The firm’s dive into the red during the six months to March 31 came after the values of its properties dropped by £300million.
Just a year ago, it had reported a profit of £38.7million. But the coronavirus crisis has hammered its portfolio, with lockdown measures forcing stores to close and leaving some tenants unable to pay rent.
Landlord Shaftesbury, which owns large parts of London’s Chinatown (pictured), managed to collect just 27.6 per cent of quarterly rents due for properties from March
It sent its shares falling 5.1 per cent, or 33p, to 615p yesterday.
Shaftesbury, which owns shops, restaurants and offices in central London, said its Chinatown properties had been affected by the pandemic from February and the rest of the West End from March.
It managed to collect just 27.6 per cent of quarterly rents due for properties it owns completely and has predicted it will only collect 50 per cent of those due from April to September.
Brian Bickell, the chief executive, said the landlord would have to support many tenants ‘not just through lockdown but through recovery as well’, which could last ‘well into next year’.
Stock Watch – Global Ports Holdings
Shares in Global Ports Holdings cruised higher despite first-quarter losses widening.
The ports operator said losses grew from £12.6million to £18.8million in the three months to March 31, as revenue grew from £20.7million to £21.4million.
But passenger numbers rose from 500,000 to 1.3m, after a major expansion into the Caribbean.
It said it was well-placed to survive the Covid-19 crisis, and would not need to raise cash until 2022. Shares rose 0.2 per cent, or 0.2p, to 95p.
‘The traditional lease model is falling apart,’ he added.
Shaftesbury said the value of its 15.2-acre portfolio had fallen from £3.8billion to £3.5billion.
It announced the suspension of the dividend in March, although bosses said they hoped to resume payouts ‘as soon as the board considers prudent’.
The turmoil on the High Street was underlined by a separate announcement from the owner of Frankie & Benny’s, which said it was closing 125 outlets across the UK.
Shares in The Restaurant Group dipped 0.8 per cent, or 0.55p, to 70p after it said it was seeking approval from landlords for a deal that would let it reduce the number of restaurants it runs, and negotiate lower rents for many of those left over.
Those affected are principally Frankie & Benny’s restaurants, it added. The company also owns the pan-Asian chain Wagamama, Mexican chain Chiquito, and runs several pubs and concessions in airports.
If landlords approve the proposals, known as a company voluntary arrangement, it will leave the company’s leisure arm with about 160 sites.
Photobooth operator Photo-Me plans to restructure its UK business because of the pandemic.
Shares slumped 3.7 per cent, or 2.1p, to 55.2p after it warned that expected revenues for March and April ‘did not materialise’ because falling international travel meant fewer customers used its booths to take pictures for documents.
Premier Inn hotels owner Whitbread has raised £900million from shareholders to help it grapple with the pandemic, but shares fell 5.7 per cent, or 152p, to 2501p.
Whitbread, which also owns the Beefeater restaurant chain, said the money would give it more flexibility after it had to shut sites.
Boss Alison Brittain said the move means that the firm is in ‘a position of strength to continue to invest, increase market share, support our colleagues and guests and create significant value for shareholders’.
Whitbread has 18 open hotels in Germany and 49 open hotels in the UK.
It is now ready to reopen the rest of its UK hotels as soon as it is given the go-ahead to do so by the Government.
But the broader picture was still gloomy after Bank of England Governor Andrew Bailey said there were some signs of a recovery as lockdown measures lifted but warned it was ‘reasonable’ to expect some long-term damage to the economy.
Britain’s FTSE 100 stayed underwater after the announcement, dipping 0.1 per cent, or 6.59 points, to 6329.13, while the FTSE 250 fell 0.8 per cent, or 149.79 points, to 17605.46.