Retail giant has debts of 拢5bn
Shopping centre giant Intu has warned that some of its retail sites could close as the firm buckles under the impact of covid-19.
The London-based chain, which made a loss of 拢2bn in 2019 and has debts of 拢5bn, has called in KPMG to 鈥渃ontingency plan for administration鈥�.
If restructuring talks with lenders fail, it said it is likely that it will fall into administration.
It said: 鈥淚n this situation, all property companies would be required to pre-fund the administrator to provide central services to the shopping centres.鈥�
It added that if the administrator is not pre-funded then its centres, which include the Trafford centre in Manchester and Lakeside in Essex, may have to close for a period.
Intu gave an update on its talks with lenders to achieve a 鈥渟tandstill鈥� last month and since then the firm has held further talks with investors ahead of a 26 June credit deadline.
Intu is one of the biggest clients for commercial projects in the construction sector.
Vinci is currently working on a 拢75m revamp of the Trafford Centre, while McAlpine is working on 拢86m redevelopment of Nottingham鈥檚 Broadmarsh centre which has been stopped since the lockdown was imposed in March. Essex鈥檚 Lakeside shopping centre was extended (pictured) by McLaren in a 拢73m deal.
Intu was already struggling before covid-19 struck, having held talks in March with lenders in efforts to secure rescue funding.
The firm has furloughed around 60% of its shopping centre staff and 20% of head office employees.
Many of the retailers in its sites are struggling to pay their rent, with only 40% of its rental and service charge income being paid for the first quarter of 2020 according to its latest rent collection update.
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