New lettings drive growth for Merry Hill owner

THE part owner of Brierley Hill’s massive Merry Hill shopping centre has said it is on target for a return to like-for-like net rental income growth for the year as a whole after seeing a spate of improved lettings and rising occupancy across its portfolio.

Intu Properties said continued improvement in retailer demand had seen 84 new long term leases agreed for £18m of new annual rent, 11% above previous passing rent and in line with valuation assumptions.

At its two sites in the West Midlands – Merry Hill and the Potteries, Stoke-on-Trent – there are several new developments imminent.

At intu Potteries, the £19m fully-let cinema and restaurant extension is set to open next month, which the group is hoping will stimulate an improved letting pipeline in the main centre.

The Black Country facility, in which intu has a 50% stake, is also set to see the arrival of a new store after intu agreed a lease with New Look Men, a new standalone menswear concept launched by New Look with a plan to open five stores nationally this year. The retailer will also be opening in intu’s Trafford Centre.

Overall, the group said occupancy rates across its centre portfolio had increased by 40 basis points since June 30, 2015, reaching 95.5%.

Year-on-year footfall to date is also marginally up in the UK and up 5% at the group’s sites in Spain, both outperforming their respective Experian benchmarks.

David Fischel, intu chief executive, said: “The economic recovery is now more obviously rippling out from London and the South East to other regions of the UK and our prime centres across the country are seeing strengthening underlying retailer sales performance.

“As this translates into improved demand for space and rising occupancy, we look forward to a return to like-for-like net rental income growth for 2015 and are well positioned for a more meaningful uplift next year.

“We have successfully completed development projects in Nottingham and Stoke-on-Trent in the period and our investment programme continues to gather momentum both in the UK and Spain.”

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