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Shaftesbury swings to £700m loss

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Shaftesbury has posted a £700m loss after the group was hit by Coronavirus restrictions.

The group, owns parts of Chinatown, Soho and Covent Garden, saw a dramatic reduction in footfall due to the lack of tourists and office workers coming into the centre.

In the second half of the year, Shaftesbury only collected 53% of the rent due, which led to an annual loss after tax of £699.5m. This is compared to the £26m profit in the previous year.

“Rarely in history has the world seen such widespread disruption to normal patterns of life. Only now are we seeing the first positive signs that conditions will begin to improve in the year ahead,” said Brian Bickell, the Shaftesbury chief executive.

“In the year ahead, the widespread distribution of effective vaccines will bring a gradual return of confidence and activity across the West End and, a recovery in domestic footfall and spending to our villages.

“At the present time, it is not possible to predict at what point conditions will improve but it is likely social distancing and other restrictions, with the risk of further lockdowns, will continue into the spring and possibly early summer, putting further financial strain on many of our occupiers.”

Net assets at Shaftesbury were down by 18% and as of September, wholly-owned EPRA vacancy was 10.2%. Shaftesbury has not declared any dividends for the year.

AJ Bell investment director, Russ Mould, commented: “Unlike some other parts of the real estate market it’s hard to see a swift recovery in valuations and rental income for Shaftesbury because of the reliance of that part of London on tourism.

“Even in the most optimistic ‘reopening’ scenario, international travel at scale could be one of the last things to make a comeback. Global roll-out of a vaccine could be patchy and different countries could face very different experiences with the pandemic next year.”

Shaftesbury shares are trading -4.83% at 522.50 (1133GMT).