Intu provides upbeat quarterly update

An optimistic outlook for the retail sector was today provided by Intu Properties, owner of Manchester's Arndale and Trafford Centre shopping malls.

Providing an interim management statement for the period between 1 July and 5 November, chief executive David Fischel said the group was encouraged by the "positive impact" of the launch of the Intu brand name and a £1bn development programme.

Intu said it was continuing to see signs of recovery in the UK economy, with a series of positive retail sales figures and improved consumer sentiment influenced by the better housing market and reduced expectations of unemployment.

"Occupiers are beginning to show more confidence, with continued strong demand from catering and leisure operators and successful retailers taking the opportunity to upsize," Intu said.

Intu said occupancy levels across its portfolio of shopping centres remain unchanged from June at 95% by rent, including 1% of rent currently being traded by administrators.

There were no significant tenant failures in the quarter, the group said.

57 long term leases were signed in the quarter; in aggregate £11m annual rent and 8% above previous passing rent for like-for-like units, bringing the total for the year to date to 152 leases producing £33m of new annual rent.

Providing an update on its digital initiatives, Intu said more than half of registrants had opted to receive marketing communications and that it was "developing the opportunity to provide shoppers with highly relevant messaging".

The group said its multi-channel shopping centre, intu.co.uk, is in test mode with 70 retailers. Around 40 more are currently being integrated and test marketing is taking place ahead of a consumer launch in 2014.

The launch will coincide with the opening of customer lounges at several centres which will offer click and collect, changing rooms and return facilities.