// Intu to slash service charge for tenants during the coronavirus outbreak
// The company’s cost savings will allow it lower the service charges
// It welcomed the business rates holiday introduced last week
Intu has said it would cut service charge for its tenants by 22 per cent in the second half of 2020, in a bid to offer support to retailers amid the coronavirus pandemic.
The shopping centre owner said its cost savings would allow it to lower its service charges, and would deliver an 11 per cent overall reduction for the year.
Intu said it welcomed the business rates holiday which was presented last week by the government, but “more support was needed” for retailers during this time.
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”We will work closely with our tenant customers to help mitigate the challenges we are all facing,” an Intu spokesman said.
“We have already written to our customers to let them know we have been able to find additional cost savings to reduce the 2020 service charge budget by 22 per cent in the second half delivering an 11 per cent reduction for the full year.
“We will continue to do all we can for the brands who rent with us while also ensuring that any concessions we make are not to the detriment of our own financial position as we look to address our balance sheet issues.
“We welcomed the business rates holiday and other measures recently announced by the government but more support is needed.
“The retail and leisure industries will be among the hardest hit by the coronavirus and we will be working closely with our customers, other landlords and industry associations to best represent their needs in Westminster.”
In recent days, retailers such as H&M, Matalan and New Look have requested rent holidays during the crisis, which has seen all non-essential retailers temporarily shut down.
Last week, analysts warned that Intu was on the brink of collapse after “running out of options”.
Earlier this month, the shopping centre giant posted a 22 per cent drop in the value of its portfolio and its debt-to-asset ratio had increased to 68 per cent.
It also posted a £2 billion loss, up from £1.17 billion the year before.
Intu said the results were reflective of the ongoing challenges in the market, particularly the increased level of administrations and CVAs exacerbated by weak consumer confidence.