RVP owner sees a third wiped off the value of its shopping centres

BIRD’S EYE VIEW: From the clock tower at Trinity Theatre
GHOST TOWN: RVP has struggled to fill empty units vacated by the likes of BHS and Topshop

The future of the town’s flagship shopping centre has been cast into doubt after owners British Land admitted last week that more than £1billion has been wiped off its portfolio in the past year, with a lack of rents from its shopping centres to blame.

The commercial landlord warned last year that the pandemic had caused a loss of around a billion off the value of its retail arm, but figures released last Wednesday [March 26] show that its shopping centres, such as RVP, lost 36 per cent of their value.

The combined worth of the FTSE 100 company’s property holdings fell by more than 10 per cent to £9.1billion over the 12 months to the end of March, its figures show.

British Land, which bought RVP in Tunbridge Wells for £96million from previous owners Hermes in 2018, say they expect shopping centre rents to fall even further, raising speculation that the landlord could be ready to dispose of its less profitable retail assets.

The decline in retail value of British Land’s retail centres, which also include Meadowhall in Sheffield, has been blamed on the pandemic forcing many of its tenants to close.

Rent collection from offices, which make up the bulk of the company’s assets, was at 99 per cent in 2020, said the landlord, but it only collected 71 per cent of the £305million it was owed by retail tenants for the same period.

Some of the £88million shortfall is expected to be recovered, but at least £30million has been written off after tenants such as Arcadia, which owned Topshop in RVP, collapsed.

As a result, British Land’s underlying profit fell 34 per cent year on year to £201million.

The news caused shares in British Land to fall 1.7 per cent in late-morning trading last week.

The commercial landlord has said it will now narrow its focus and invest in urban logistics and out of town retail parks – two sectors which have benefitted from the boom in e-commerce during the pandemic – but it raises speculation that the company could offload its least profitable assets, such as its shopping centres.

Simon Carter, British Land’s Chief Executive, warned that shopping centre rents are expected to fall another 10-15 per cent from today’s levels but added that the company has made no firm decisions on its assets yet.

He said: “We’ll roll our sleeves up and do some heavy asset management. Once we’ve got stable cash flows we can make a decision on the outlook.”

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