TCS pre-lets former Daisy & Tom as revamp nears completion

Town Centre Securities, the Leeds-based developer active in Manchester and Rochdale, today confirmed pre-lets at the former Daisy & Tom store on Deansgate as it gave a trading update on its third quarter ended 31 March 2008.

The company said it "has continued to make progress and performance remains in line with…expectations in spite of very challenging times" and added that the board "remain very cautious about the short-term outlook".

TCS said it had agreed renewals of over £100m of bank facilities for five years, with the majority of borrowing at fixed rates.

Redevelopment of the former Daisy & Tom store at 118 to 124 Deansgate, Manchester, is nearing completion.

Of the 19,500 sq ft of retail and leisure space in three units, office supplies retailer Staples has taken 3,500 sq ft on a 10-year lease. Outdoor clothing chain Cotswolds has signed for 8,000 sq ft. The remaining 8,000 sq ft on ground and first is earmarked for a restaurant, as yet unsigned. Rents were undisclosed. Retail letting agents are Cushman and Wakefield, Jackson Criss and Central Retail.

Upper floors will contain 14 residential units, which may be kept on the books as serviced apartments. Residential agents are Julie Twist Properties.

Elsewhere, TCS said work on the current, 65,000 sq ft phase of Central Retail Park in Rochdale was also nearing completion. Development plans for the remaining 80,000 sq ft in three units have yet to be finalised.

In Piccadilly Basin, tenants are now in occupation at Carvers Warehouse with less than 6,000 sq ft out of a total 22,000 sq ft of the space remaining to let. Building Design Partnership is fitting out its new building ready for occupation this summer. Carvers Warehouse officially launches at an event on 22 May.

Void levels across the group's portfolio are currently running at 10% reducing to 3% if ongoing refurbishments are excluded.

Bank facilities in excess of £100m have been agreed until September 2012 (compared to £45m at the time of the interim results in February 2008).

At 31 March 2008 the group had net debt of £214m of which 89% is at fixed rates. Further facilities of £53m are currently available, including £150m of quoted debenture stock at 5.375% repayable in 2031.

Edward Ziff, chairman, said: "Our well located portfolio, based in the major conurbations of Leeds, Manchester and Glasgow along with our long-term and largely fixed rate debt facilities provides a stable foundation to manage the prevailing market. We believe that difficult conditions are likely to remain for some time and will restrict significant investment in new projects.

"In the meantime, we remain committed to optimising our existing portfolio, managing our major development schemes and adding to our portfolio where suitable opportunities emerge."

Shares were down nearly 1.5% at 217p.

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