Developer upbeat on Piccadilly Basin
PROPERTY group Town Centre Securities is confident about the long-term development of Piccadilly Basin in Manchester and finding a new “lifestyle store” to take over the former ILVA site.
The group is relying on a “strong” rental income stream and occupancy levels from its portfolio after falling to a half-year loss of £72.9m because of the falling value of its properties.
In its half year results today, the group said: “We remain optimistic for the long term for our key development site at Piccadilly Basin in Manchester city centre, situated in close proximity to Piccadilly station”.
It said it had suffered bad debts of £500,000 following the administration of Scandinavian homewares group ILVA but said “plans for our retail store at Piccadilly Basin, which accounts for 4% of the void space, are gaining momentum as we test the market for a more innovative approach to running a lifestyle store from this location”.
The Yorkshire -based group, which owns the Merrion Centre shopping complex in Leeds, saw underlying pre-tax profits excluding disposal profits and losses and other exception items, increase slightly to £4.4m in the six months to December 31 compared to £4m in the same period of 2007.
However a half-yearly valuation of its property portfolio by surveyors Jones Lang LaSalle saw a fall of £76.6m to bring make a statutory loss of £72.9m compared to a profit of £62.5 a year ago.
Chairman and chief executive Edward Ziff said that it was “the most dramatic fall in commercial property values that I have ever seen”.
Mr Ziff said that occupancy levels were 96% compared to 97% at the end of June last year.
TCS’ car parks at Clarence Dock and Whitehall Road in Leeds and Piccadilly Basin in Manchester have seen an uplift in revenue despite the downturn.
The group saw underlying earnings per share of 8.2p, compared to 7.1p last year and made a basic loss per share of 137.4p. Net asset value per share is 271p.
It is proposing an unchanged interim dividend of 2.75p per share.
TCS’s borrowings stood at £202.6m at December 31 and it will reduce them further following the completion of the sale of £10.7m of properties this week.
