José Snyders, L2D’s financial director, said the company had elected to be become an upfront landlord in Edcon’s restructuring.
“We spent just less than R25 million to buy 0.277percent of the Edcon equity as part of their restructuring. In that deal our rentals were not impacted, so we received our full rentals due to us for the next 24-month period,” Snyders said.
“In coming to the conclusions to become an upfront landlord we evaluated the risks and the commercial benefits attached to it. I think it is important to understand that after 24 months everything goes back to normal for everyone who is a landlord to Edcon.”
He added that L2D was starting to see a turnaround of Edcon’s performance in the centres L2D owns. However, Synders said the group was proactively reducing its exposure to Edcon and that by the end of the year its exposure to Edcon will be less than 4 percent of the company's portfolio.