Retail parks performances lift British Land's “resilient” Christmas trading period
We know it’s been a wildly unpredictable retail rollercoaster ride during a Covid Christmas trading period. So, as a bellwether of UK commercial property, how has sector giant and Broadgate/Meadowhall owner British Land performed since its last update in November?
Under the circumstances, admirably, with footfall, sales and rents all holding up pretty well, especially at its retail parks.
“On 24 December, 73% of our stores were operational and footfall and sales proved resilient in the four weeks to Christmas”, the company said on Monday.
It also added: “As at 7 January, following the latest national lockdown, 620 of our stores are able to trade in some way, representing 32% of the total”.
That surprising total was boosted by the fact that its retail assets were “particularly well suited to click & collect, which has enabled many non-essential stores to continue to operate throughout this important trading period”.
So how did British Land’s festive trading performance shape up? Between 30 November and 26 December, footfall across its £13.7 billion portfolio was trading at 76% of the level achieved last year, and 21% ahead of the ShopperTrak National Index UK market benchmark, it said Monday in its operational update.
And it did back up various reports that retail parks had seen better business over the Christmas trading period than high streets and shopping centres.
"Well located, open air retail parks have continued to play an important role for retailers and demonstrate operational outperformance with footfall 87% of the same period last year”, British Land said. That was an even better 32% ahead of the UK market benchmark, it noted.
Meanwhile, like-for-like retailer sales for stores that were open across the four-week period were trading at 81% of the same period last year.
It also saw no notable difference in performance between assets in different trding tiers, it said, with those in Tier 4, only 5% weaker on average than the other tiers due to the closure of non-essential stores.
And on the rents front, British Land said it had collected 71% of total amounts due. Across the business, £86m of rent was due for payment in the December quarter (before taking account of adjustments made in support of its customers as a result of Covid-19), including £42m in Retail.
It said retail rental collection levels for previous quarters have also continued to increase: “We have now collected 72% of September rent, 73% of June rent and 49% of March rent, with March collection being lower due to 27% of deferrals provided”.
And in its latest period to 7 January, seven working days after the quarter end, it had collected 46% of December rents, "broadly in line with the collection rates at the same point in the previous quarter, and would again expect collection rates to improve over the coming weeks”.
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