The owner of Aberdeen’s Union Square Shopping Centre has said some tenants across its UK portfolio are “openly ignoring their rental obligations when they have the means to pay”.
The comment, from Hammerson’s new chief executive Rita-Rose Gagne, came as the group posted pre-tax losses of £354million for the six months to June.
The FTSE 250-listed property developer and investor also said the value of its portfolio, which includes the Brent Cross Shopping Centre, in London, and the Birmingham Bullring, had decreased by 6.4% to around £5.5billion.
Writing in an update to investors, Ms Gagne said: “While we expect rent collections to improve as trading levels increase, the further extension to the UK Government’s rent moratorium to March 2022 has led to some retail businesses openly ignoring their rental obligations when they have the means to pay.
“By continuing to extend the moratorium and also not addressing the inequity of business rates, the UK Government continues to undermine the attractiveness of the sector and its investment case.
“We do not anticipate granting concessions for future periods and all avenues to collect rents due are being actively pursued.”
Group looking at new ways to fill empty shop spaces
The London-based group has also laid out a new growth strategy which will see it seek more opportunities away from retail.
Ms Gagne said plans could include food halls, events spaces and roof-top theatres to boost trade in the short term. However, she added the firm will repurpose some void retail spaces for alternative uses such as homes, hotels and office space.
Hammerson currently has more than 800,000 sq ft of empty department store space.
Ms Gagne said: “As we emerge from a unique moment in time, I see a pathway to create sustainable value as we transform the business to become more agile and able to anticipate and respond to this change.
“We own flagship destinations around which we can curate and reshape entire neighbourhoods and city centre spaces for generations to come.”
Hammerson’s share price dropped by 1.79% to 35.71p in trading on Thursday.