CSC upbeat after year of Whittaker’s ‘stimulation’

Publicly traded shopping centre owner Capital Shopping Centres, which bought the Trafford Centre from Peel Group in January 2011, benefited from the rising value and 'quality income stream' of its new addition last year.

CSC owns and operates 14 malls in the UK with a combined net rental income of £364m.

The company reported full year results for 2011 on Thursday, with the market value of its properties up 36% to £6.96bn, largely due to the absorption of the Trafford Centre, now by far the largest mall in the group. The value of the Trafford Centre rose £50m to £1.7bn at 31 December 2011. Occupancy was put at 96%. Rent reviews are due at many Trafford Centre units in 2013.

David Fischel, chief executive of CSC, commented: "The results demonstrate CSC's considerable progress in 2011. The transformational Trafford Centre acquisition has driven our strong performance and has exceeded our expectations. While the UK economic environment is challenging, CSC is well positioned for growth with assets of uniquely high quality, a considerable capital base, a committed management team and a pipeline of future projects."

Peel chairman John Whittaker became deputy chairman of CSC following the Trafford Centre deal and centre director Mike Butterworth is now CSC chief operating officer. The Trafford Centre management team have taken charge of a handful of the 14-strong portfolio.

Patrick Burgess, chairman of CSC, added: "We have benefited from the transformational acquisition of the Trafford Centre at the beginning of 2011, not only because of the high quality income stream but also from the successful integration into CSC of its management and ideas.

"We have greatly appreciated the important contribution across our entire business with stimulating ideas for many of our centres from John Whittaker in the role of deputy chairman since January last year.

"By any measure, we are robust operationally, with 97% occupancy and three consecutive years of overall footfall increases at our centres."

Like-for-like net rental income grew by 3.6%. Group occupancy remained strong at 97%. There were 198 new long-term lettings last year, adding £9m additional annual rent for the group.

Counting the eleven months of the Trafford Centre's trading, net rental income of £364m was up 31% on 2010.

Under exceptional costs, CSC said £17.6m had been spent on administration due to the acquisition and integration of the Trafford Centre. CSC also said that Peel Group would guarantee Section 106 planning liabilities of £10.6m relating to the redevelopment of Barton Square within the Trafford Centre.

Earlier this month, CSC shareholders approved two transactions with the Peel Group. The first was the acquisition for £4.7m from Peel subsidiary Clydeport Properties of a 30.96-acre site known as King George V Docks (West) adjacent to CSC's shopping centre at Braehead. The second transaction was the acquisition for €2.5m from Peel Holdings of a three-year option alongside a refundable deposit of €7.5m to purchase two parcels of land in Malaga, Spain with planning consents for a regional shopping centre.

Shares in CSC were down 1p at 333p.