Join our community of smart investors

For Capital & Regional, look past the headlines

Valuations took a hit at Capital & Regional, but operating profits are up
August 19, 2016

Peering through the gloom generated in the wake of the EU referendum, we find shopping centre landlord Capital & Regional (CAL) performing well enough in the first half to push through a higher interim dividend, and drive like-for-like rental income up 3.9 per cent to £23.8m. Headline numbers were affected by last year’s £57m valuation gain on the portfolio giving way to a £10.3m fall.

IC TIP: Hold at 59p

A total of 27 new lettings were secured, generating rent of £2m at 4.6 per cent above previous estimated rental value. A further 11 renewals brought in £1m but at a 5.3 per cent discount to the same measure. That's because existing tenants were opting for lower headline rents rather than receiving incentives on renewal. Closure of the three BHS stores within the portfolio will result in a £0.5m loss of income in the second half, but the sites are expected to be leased out for higher rent levels, and discussions are already taking place.

To continue reading...
REGISTER FOR FREE TODAY
  • Read 3 articles for free each month
  • Educational articles and topical investment guides
  • In-depth podcast episodes by our writers and industry professionals
  • Interactive live webinars on investment themes that matter
Have an account? Sign in