Town Centre Securities has criticised tenants including Boots and JD Sports for failing to pay rent during the coronavirus pandemic.
The property investor and car park operator has posted a near-doubling of its annual loss, as the company vowed to accelerate a revamp of its business.
TCS reported a loss before tax of £24.2m for the year to 30 June, compared with £12.5m a year earlier. Chairman and chief executive Edward Ziff pinned the loss on a near-7% drop in portfolio valuation, which fell to £372.5m.
“These are clearly disappointing numbers, but with earnings impacted by £3.6m due to Covid-19, and our valuation results significantly better than other companies with less resilient retail portfolios, we are reassured by the resilience of our portfolio and our full compliance with all covenants,” Ziff said.
The company now wants to step up its disposal of retail and leisure assets, “albeit only at sensible values”.
Ziff said most tenants had “acted responsibly and in good faith” during the pandemic and lockdown, but singled out Boots and JD Sports for different reasons.
“It has been frustrating that some, such as Boots, have not been so considerate and have taken advantage of legislation put in place for companies who wouldn’t otherwise be able to afford their rent,” he said.
Ziff also reiterated criticism of JD Sports over the administration of its Go Outdoors subsidiary.
“For a large, profitable and valuable company, their unwillingness to stand by leases they had only recently acquired is unacceptable and reflects very poorly on their senior management,” Ziff said.
“Knowing they were impacted by Covid-19, we made proposals to share the impact. However, with their chosen approach landlords have had to take all the rental pain. We presume they haven’t treated their trade suppliers in the same manner, otherwise they would have put their supply chain in jeopardy.”
The chief executive continued: “There is a presumption in insolvency situations that all creditors should be treated equally. We hope that in light of this the government will seek to implement legislation to prevent profitable companies acting in this way in the future.”
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