Amelia Beattie, chief executive of L2D. Photo: Supplied
Amelia Beattie, chief executive of L2D. Photo: Supplied

Easing of regulations bodes well for Liberty Two Degrees operations

By Sandile Mchunu Time of article published Sep 29, 2020

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DURBAN - Liberty Two Degrees (L2D) yesterday welcomed the easing of the lockdown to level 1 after the real estate investment trust (Reit) said its operations were severely hampered by Covid-19 in the first half of the year.

The group told shareholders in an operational guidance that the easing of the regulations boded well for its hospitality portfolio.

It said its foot count across its portfolio had improved to 80percent - the level last seen in 2019 - with Eastgate the best performer at 97percent, the Midlands Mall at 88percent and Sandton City at 85percent.

“The operational performance for the first six months of 2020 was significantly impacted by the Covid-19 pandemic and the implementation of a national lockdown,” L2D said. “The move to lockdown level 2 on August 18 and the reopening of the South African economy has contributed to a recovery in trading, with a marked improvement in foot count at our centres with most tenants having reopened for trade.”

The group said the monthly portfolio foot count at the end of August improved to 68percent of the comparative 2019 level and continued to rise with a 10percent upswing from July as the number of tenants trading as a percentage of retail gross leasable area at the end of August was 93.1percent, which represented an improvement from the 85.4percent reported at the end of June.

It said the relaxation of the restrictions would also support the ongoing economic recovery.

“The ability of restaurants to operate at increased capacity and the opening up of international travel from October 1 will provide additional impetus to the South African economy and the recovery of our hospitality portfolio,” the group said.

L2D reported a 40.4percent decline in net property income to R201.8million in the six months to the end of June, significantly impacted by a decrease in footfall as shopper behaviour changed with the advent of Covid-19 and the subsequent lockdown.

The property industry has granted rental relief to its customers in response to Covid-19 outbreak. The group said yesterday that rental collections based on the full amounts due and before the rental relief increased to 74percent at the end of August.

“This is an improvement from the levels last reported in April at 38percent and May at 45percent. The respective collections percentages for June and July were 65percent and 72 percent, respectively,” the group said.

L2D attributed the improvement to the further finalisation of rental relief negotiations and the fact that almost all tenants were now trading.

L2D shares rose 2.04percent on the JSE yesterday to close at R5.

BUSINESS REPORT

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