Monsoon & Arcadia CVAs to adversely impact Intu centres

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Intu Monsoon
// Monsoon Accessorize and Arcadia CVAs to affect Intu
// Monsoon currently has 19 stores in Intu’s shopping centres
// Intu is Arcadia’s second-biggest landlord

Intu is set to be the biggest victim of Monsoon Accessorize’s CVA, while Arcadia’s CVA confirmation is also expected to affect the shopping centre firm.

Monsoon currently has 19 stores in Intu’s centres, of which four are due to face rent cuts of over 50 per cent, while six others will have rents slashed by over a third if creditors approve of Monsoon’s restructuring plan early next month.

Monsoon revealed it was seeking to take out a CVA and currently expects an underlying loss of £3 million this year.

Although no closures have been proposed, Monsoon is seeking to close down at least seven shops within eight months.

Meanwhile, Intu was the only major landlord to vote against Arcadia’s CVA earlier this month.

The retail empire’s CVA was approved and will result in lower rent for Arcadia shop units.

Intu is also Arcadia’s second-biggest landlord, therefore the rent cuts are likely to affect firm’s ability to generate earnings.

”We expect the remainder of 2019 to be challenging as a result of a higher-than-expected level of CVAs,” Intu chief executive Matthew Roberts said.

”As such, we have revised our approach to how we guide towards our year-end like-for-like net rental income to factor in expected CVAs, and have adjusted our 2019 guidance accordingly to -4 per cent to -6 per cent.”

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