West End landlord collects less than a third of rent in June

Great Portland Estates said it collected less than a third of the rent owed in June by its tenants running shops, restaurants and pubs in central London, as the impact of the coronavirus lockdown continued to bite.

The West End landlord received only 28% of the quarterly rent due from its retail and leisure tenants last month. It resorted to cashing deposits as the troubled occupants of its properties struggled after a collapse in demand.

Most shops and cafes in much of the capital’s once-crowded centre closed until the middle of last month. Footfall has not returned to pre-pandemic levels.

GPE said it had collected slightly more than half of the rent due overall, including office lets, bringing in a total of 69% of rent due with deposits.

The company said all of its office space had reopened with approved measures in place to address the Covid-19 pandemic. However, it is understood that most of it remains unused by tenants.

Toby Courtauld, chief executive of GPE, said: “Whilst the lockdown has started to ease and our office pre-letting momentum remains healthy, Covid-19 is disrupting the activities of many of our existing occupiers, which in some instances is impacting their ability to meet their rental payments. We continue to actively engage with all our stakeholders, in particular, offering assistance to our occupiers, on a case by case basis to support them through this unprecedented time.”

GPE’s share price fell sharply at the start of the pandemic as shops and restaurants closed and most office staff started working from home. This turned prime London locations into a ghost town.

Courtauld said that despite challenging conditions, the landlord remained well positioned. He added: “Our leverage is low, providing strength in these difficult markets with significant capacity for growth should opportunities emerge; our portfolio is almost fully let and our extensive development pipeline is set to deliver high quality, sustainable spaces that remain in high demand.”

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The group has collected 82% of rent that was due in March, including drawn deposits from occupiers. It said it had another £21.6m worth of rent deposits and bank guarantees, and total liquidity of £390m. It said it had seen a slight increase of 4.4% in lettings since March. This included signing up investment firm Exane on a 15-year contract to rent part of a new block being built in Oxford Street.

GPE’s is not the only property landlord to collect a fraction of rent from its retail and leisure tenants. Hammerson, the landlord that owns the Bullring in Birmingham and the Brent Cross shopping centre in north London, said earlier this month it had collected only 16% of rent due in May and June.

British Land, which owns the Meadowhall centre in Sheffield and Drake Circus in Plymouth, said it had collected 36% of rent due from its retail sites and 88% from offices, even though about two-thirds of the retailers had reopened by the end of June.


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