Retail – Intu issues warning
A stark warning this week from the owner of some of the UK’s biggest shopping centres including The Trafford Centre and Lakeside that it could go burst.
The weakness in the retail sector meant Intu wrote down the value of its shopping centre sites by nearly £2bn.
The collapse and contraction of High Street retailers has left landlords such as Intu struggling to fill vacant space. At the same time, Intu has run up debts of nearly £5bn. Full details here.
Political – Budget 2020
With the emergency package in light of the Coronavirus revealed on Wednesday, there was dismay at business rates weren’t extended to larger retailers and leisure companies. Rates for small retail and leisure operators with rateable values below £51,000 will be suspended for a year.
“Our town and city centres, and businesses of all sizes, need more support today. It is not enough to just offer more relief to small businesses and ignore the UK’s bigger high street stores, which are some of the country’s largest employers.” British Property Federation chief executive Melanie Leech said.
Other property-related measures include a stamp duty surcharge of 2% for international buyers of UK residential property. The change will come into effect in April 2021 and will apply to invidudals as well as companies.
A £1 billion cladding remediation fund will help more leaseholders and owners to remove unsafe cladding from residential buildings taller than 18 metres. Up to 450 buildings across the UK were clad in ACM at the time of the disaster in June 2017, and since then 127 towers have had cladding removed. The rest remain clad in ACM.
Read the RICS response to the budget here.
Offices – no London postcode left unexplored
Demand for space continues to soar, outstripping supply, which is causing some occupiers to consider locations that previously might not have.
Apparently rents are homogenising at £60/sq ft to £70/sq ft from Shoreditch to Paddington.
The introduction of Crossrail’s Elizabeth line “remains the key driver and catalyst for any expansion zone”. To the east, locations such as Silvertown and western locations such as White City look to be serious contetenders for growth.
Other emerging locations that London office agents believe are ripe for growth are Canada Water, where British Land is delivering 53 acres of homes, offices, retail and public space, and Brent Cross South, where Argent Related’s joint venture with Barnet Council is set to develop 6,700 homes, workspace for 25,000 people and associated amenities.
“The best hubs are ones where there is a true mix of dynamic occupiers”. There being very few submarkets and postcodes left that are associated with a particular sector. What people perceive as ‘the City’ has hugely changed.
Interesting read here about the market.
Industrial – Prologis strengths committed to Hemel Hempstead
Prologis has purchased the unit known as The Cubic on the Eastman Way which comprises of six units, totalling an of 138,696 sq ft. The deal cost 26 million, with three of the units are currently leased to Cadogan Tate Ltd and the other three units due to marketed soon.
It’s close to two of its existing properties in Hemel Hempstead and will help meet the growing demand for floor space in the area, due to its proximity to London.
Financial – the impact so far of Coronavirus
Phase 2 of the Governments plan looks to underway with Boris Johnson calling it “the worst public health crisis for a generation” with the aim to delay the spread of the virus “and thereby minimise suffering”.
From Friday, school trips abroad will be banned, and older people and those with pre-existing health conditions have been told not to go on cruises.
For the latest news on the virus click here
We’re hearing of projects being delayed with factories in China shut down, growth is slowing down and customers are buying less as they stay away from activities such as shopping, eating out and holidays c.
This is a good summary from the BBC of the impact so far of the virus.