Capital & Regional, the UK focused specialist property REIT, says its schemes enjoyed a good Christmas with like-for-like footfall over the last two weeks of the year up 2.2% on the prior year.
Footfall improved in the second half of 2016 and for the whole of 2016 the portfolio once again outperformed the industry benchmark, by 1.9%.
Other operating performance highlights:
- There has been continued good momentum in leasing activity in the second half of 2016 with 34 new lettings and 15 lease renewals totalling £2.8 million in annual rental income, at a combined 6.1% premium to ERV2. Key lettings in the period include Burger King, Footasylum and Wilko at Blackburn; Card Factory and an upsized JD Sports at Luton; The Gym at Walthamstow; Foot Locker at Wood Green; and upsized Holland & Barrett stores at both Luton and Maidstone.
- Contracted rent was £57.5 million as at 31 December 2016. Following the sale of The Mall, Camberley in October 2016, this represents a like-for-like increase of £0.3 million on 30 June 2016 or £0.9 million on 31 December 20153.
- Occupancy remains strong at 95.4% for the portfolio at 31 December 2016.
Chief executive Hugh Scott-Barrett said: "The operating performance has been very encouraging reflecting stronger consumer confidence in the second half of the year than had been anticipated following the result of the EU referendum. Footfall is up and, as has become the trend for our schemes, is well ahead of the national benchmark, while letting momentum has been maintained as the mix of town centre locations and affordable rents continues to attract new retailers and leisure operators.
"Activity in the investment markets continues to highlight the attractiveness of assets which have the potential for leisure and residential development, and this evidence, alongside our geographical focus on London and the south east, has helped to underpin the valuations for our wholly owned portfolio.
"Having disposed of The Mall, Camberley and refinanced our core banking facility on very attractive terms, Capital & Regional is well placed to maintain the momentum behind the execution and delivery of our asset management programme. We also expect to be able to take advantage of opportunities to recycle capital into higher yielding investments with greater growth potential.
"Reflecting the positive operating performance and our confidence in our ability to continue to grow income we expect the increase in the final dividend for 2016 to be at the top end of the 5% to 8% per annum targeted range."