Intu warns of cautious retail outlook

The owner of Manchester's Trafford and Arndale Centres today warned that the UK retail environment remains difficult, with retailers continuing to be cautious about entering into store commitments.

However, providing an interim management statement for the period between Tuesday 1 January and Wednesday 8 May, Intu Properties said its shopping malls continue to "out-perform national benchmarks and attract new brands and flagship stores".

Intu said footfall during the period was down 1% on 2012.

Occupancy levels are currently 95%, down 1% from Saturday 1 December due to the expiry of seasonal lettings.

Thirty three new long term leases were signed in the period, representing £8m of new passing rent.

Highlights in Manchester include ongoing work towards Next's expansion into adjacent units to create a 40,000 sq ft flagship store, with the first phase successfully opening in March.

The £6m investment by Sealife in an aquarium attraction at Barton Square is on target for opening next month, Intu said.

Commenting on the outlook, Intu said: "Tenant failures, lease expiries and tenant caution over new store commitments remain risk factors likely to continue to impact short term earnings.

"However, we are driving medium term value creation by using our focus, scale and specialism to maximise the opportunities available to us in the changing marketplace."