Empty stores at record low for Town Centre

Despite the incredibly tough retail environment, the Leeds-based company said its void level now stands at 2.97 per cent, a drop from 4.6 per cent at the beginning of the year.

Town Centre’s chairman and chief executive Edward Ziff said the void rate was the lowest in the company’s history.

“We are working really hard,” he said. “Our rents are not at the highest levels they have been. We’ve had to give some rent freezes. But having a void level of less than three per cent is fantastic. Our properties are very easy to let or they would be sitting empty.”

The group’s flagship Merrion Centre, which represents over 40 per cent of the group’s portfolio, has continued to outperform the market with a five per cent increase in income growth over the period from January 1 to May 16.

The mall, with its focus on discount retailing, continues to beat the downturn as shoppers tighten their belts.

The centre recently secured three new lettings, Coral Racing, KFC and Apple franchisee KRCS.

Bookmakers Coral Racing will occupy a store totalling 1,103 sq ft and will pay £45,000 a year having agreed a new 10-year lease.

Chicken Cabins, the KFC franchisee, has agreed a new 20-year lease on a unit of 2,258 sq ft. The fast food retailer will pay £70,000 a year.

KRCS, the Apple franchisee, has taken a new five-year lease on a store totalling 990 sq ft. KRCS will pay £46,000 a year.

The three stores form part of the key piece of real estate on the Leeds inner city loop road.

The properties are part of a redevelopment plan being undertaken by Town Centre that will include new frontages, elevations, cladding and glazing.

Helen Beckett, asset manager at Town Centre, said: “We are looking to breathe life and presence back into this location by undertaking comprehensive improvements to the elevation and appearance to the building as well as introducing new national brand tenants.”

Estate agents Savills represented Town Centre in the deals.

Steve Henderson, director at Savills, said: “The further improvements to the Merrion Street frontage of the scheme and the pre-lets secured show Merrion’s strong ability to attract national retailers of a high calibre.

“The scheme continues to go from strength to strength as illustrated by these new lettings and the redevelopment.”

Last July, Town Centre took back the management of the Merrion Centre multi-storey car park.

It has introduced its Town Centre Car Park branding and instigated a number of marketing initiatives which have increased parking volumes and the overall footfall in the Merrion Centre.

Town Centre is gearing up for the opening of the Leeds Arena, a 13,500 capacity concert and events venue, right next door to the centre.

Mr Ziff said that the opening of the Arena presents new opportunities for leisure units such as restaurants, bars and pubs which can cater for visitors.

The Merrion Centre car park should also benefit as it is the nominated car park for Arena nights.

Aside from Merrion, Town Centre said its principal success during the first five months of 2011 has been the lettings at Urban Exchange in Manchester.

Marks & Spencer has entered into an agreement to lease 19,000 sq ft and Pure Gym, a 24-hour gym operator, has entered into an agreement to lease 19,000 sq ft on the lower ground floor.

“We anticipate that both tenants will be trading by September,” said Mr Ziff.

“Following the opening of Go Outdoors in April, we now have only one unit of 7,000 sq ft unoccupied and we hope it will be let before the end of the calendar year.

“We are incredibly pleased to have been able to let a building of this magnitude thereby creating a successful scheme in the midst of a challenging economic climate.”

He added that the group has continued to perform strongly since the half year end. Rent collection was very strong with 99 per cent of March quarter day rents collected within five days of the due date.

“This performance demonstrates further our strong asset management capabilities and the importance of retaining our focus on the value for money retail sector,” he said.

[email protected]