José Luis del Valle, Lar España’s chairman of the board
Since June, affluence and sales in its shopping centres rapidly approached last year’s numbers, and during September, those numbers represented 96% of the same period last year, informed the company.
Lar España stated that «it showed caution when facing the effects of the sanitary restrictions implemented by several autonomous communities during the last few days. It ratified its support to the measures adopted by the different authorities as well as its willingness to cooperate with them and its commitment towards the security of its professionals, retailers and clients».
The REIT has renegotiated individual leasing deals on 95% of its shopping centres’ GLA. With the exception of shutdowns required for after the 30th of September 2020, the company estimates that the total accumulated discounts caused by Covid-19, once the agreements are concluded for 100% of its GLA, will be between 19 and 20 million euro. According to the corresponding regulation, the aforementioned discounts will be allocated to the company’s results starting on the date of execution, impacting its revenues for the duration of each of the contracts, on an average deadline of between 6 and 7 years. The company quantified the impact in the profit and loss account, for the whole of 2020, in less than 2 million euro.
José Luis del Valle, Lar España’s chairman of the board, was satisfied with the REIT’s management during the Summer. «Since the beginning of the pandemic, we have been ahead of the situation, reinforcing the safety and hygiene measures as well as the full technological control over access and affluence. With the scaling down of the restriction measures, we redoubled our cooperation and alliance with our tenants and we have, right now, renegotiated with them long-term leasing contracts for more than 95% of our total area. We defined a model which has proven resilient, reactivating quickly during the scaling down and when normalcy is fully recovered, a moment which will surely come, it will show what it’s worth».
The decrease in terms of assessments experienced by the whole real estate sector also affected Lar España. Between December 2019 and June 2020, the REIT’s assets’ assessment values decreased by 2.9%, representing 55.9 million euro, reaching a total of 1.509 million euro. This reduction will be transferred to the period’s accounting result, which will result in losses of 17.4 million euro, whereas the recurring net profit grew around 46% during the first nine months of the year, reaching 40.9 million euro.
Find the full news in Spanish HERE.