Roy Cokayne
LISTED Intu Properties is making progress with its goal of becoming the leading owner, developer and manager of the major regional shopping centre destinations in the major trade areas of Spain.
The company owns nine of the top 20 super-regional centres in the UK.
Intu Properties, previously known as Capital Shopping Centres (CSC) Group, acquired Parque Principado in Oviedo in October 2013 and exchanged contracts in December to acquire the Puerto Venecia shopping centre and retail park in Saragoza for e451 million (R5.9 billion).
CSC is the unbundled and separately listed mall business of Liberty International, which was founded by South African Donald Gordon.
David Fischel, the chief executive of Intu Properties, said on Friday that it owned two of the top 10 shopping centres in Spain and the Puerto Venecia transaction had substantially accelerated its activities in Spain.
Fischel said 80 percent of Spain’s retail expenditure came from 10 key catchment areas, while ownership of the largest Spanish shopping centres was fragmented and many regions did not have a pre-eminent retail and leisure destination.
He added that the committed pipeline of prime shopping centre developments across Spain was now at a low level and they believed the opportunity existed to develop and build new schemes in a number of key regions.
He said Intu Properties already had development options on sites in Malaga, Palma, Valencia and Vigo and, subject to shareholder approval, intended to exercise the Malaga option this month.
“We are working to bring the other developments forward to the point where we can consider exercising the options,” he said.
“They all have different time periods. We are confident about the project in Valencia and two others will probably come after that.
“We’ve got plenty to keep us going across the group for some years to come.”
Fischel said they hoped to be on site next year to commence development on the Malaga site.
Intu
Properties has a total investment pipeline of £1.9bn (R34.1bn) over the next 10 years, of which about £600m is earmarked for the Spanish market and the balance for projects in the UK.
“Since we acquired Parque Principado, rental levels have been low, but with nothing being built in Spain of any size and the quality of the existing stock not great, there is plenty of opportunity to build world-class centres in Spain.”
Fischel said Intu Properties was looking to introduce an investment partner into Puerto Venecia to spread the company’s capital and allow it to take on more.
Intu Properties on Friday reported a decline in underlying earnings a share of 13.3 pence in the year to December from 13.7 pence in the previous year.
This reflected a reduction in like-for-like net rental income of 3.2 percent in the year.