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https://www.bbc.co.uk/news/business-53136807

It looks like intu is going to go bust.  This is a really big story as they own most of the "successful" out of town shopping centres in the UK.

Time are changing at speed and I don't know whether walk in retail will ever recover post COVID.  Boris today was confident, but I could see desperation in him.

He knows the game could be up.

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6 minutes ago, Social Justice League said:

https://www.bbc.co.uk/news/business-53136807

It looks like intu is going to go bust.  This is a really big story as they own most of the "successful" out of town shopping centres in the UK.

Time are changing at speed and I don't know whether walk in retail will ever recover post COVID.  Boris today was confident, but I could see desperation in him.

He knows the game could be up.

Great time for local Authorities like Woking Borough Council to clean up......oh hang on ?

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24 minutes ago, Social Justice League said:

https://www.bbc.co.uk/news/business-53136807

It looks like intu is going to go bust.  This is a really big story as they own most of the "successful" out of town shopping centres in the UK.

Time are changing at speed and I don't know whether walk in retail will ever recover post COVID.  Boris today was confident, but I could see desperation in him.

He knows the game could be up.

Rode through North London into town today all commercial centres busy queues outside Primarks, JD Sports/Sports direct and H&M’s 

might be a blip but never under estimate the public’s appetite for tat 

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They just finished the Manchester Metrolink tram extension to the Trafford Centre about a week before lockdown. 

Trafford Centre is currently mostly locals, but the tram extension would have made the Trafford Centre feasible to tourists coming to watch a ManU game at Old Trafford. 

There's sweet nothing on the extended line other than the Trafford Centre. 

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Posted (edited)

https://www.ft.com/content/8176ffde-f4be-435f-b713-4cea49a4822b

 

Why a midsummer nightmare ending looms for Intu

Kate Burgess

6 hours ago

 

Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found here.
https://www.ft.com/content/8176ffde-f4be-435f-b713-4cea49a4822b

Wednesday June 24 is old-fashioned quarter day when rents for the next three months are due. But it will be no quarter day for Intu, the ailing retail property group trying to extricate itself from a £4.5bn tangle of debt. The owner of the Lakeside and Merry Hill shopping centres was being strangled by problems on the high street even before coronavirus closed shops down. Lombard has feared the worst since the new year. At the last quarter day in March, Intu received less than 30 per cent of money due. The tally won’t be better in June. Lockdowns may be loosening but retailers are still threatening not to pay rents and landlords are unable to evict recalcitrant tenants before September. Intu has asked its lenders to agree to a standstill on their loan terms ahead of key covenant tests tied to the midsummer quarter day and property values. It had parlayed for pay-if-and-as-you-can terms and an 18-month delayed deadline. Fat chance, replied lenders. Certainly no more than 15 months, said the kinder ones. Not even that, said the rest. It looks like Intu may not even have five days. The group has now lined up KPMG as a prelude to going into administration. If lenders with claims on specific sites want to keep the lights on and security staff patrolling the floor, they will have to pre-fund the administration too, says Intu. The group is running out of cash fast. The way to sidestep insolvency is for Intu to get all its myriad lenders to meet and agree quickly on how to divide up the group’s obligations, assets and liabilities into equitable parcels. It will be standing room only for the group’s banks, hedge funds and other financiers. Intu’s liabilities are a morass of credit facilities and convertibles at the group level, with separately structured layers of secured debt, restricted pockets of cash, debentures and interest rate swaps below that. Equity holders, whose shares have fallen from £3 to 4p in five years, will be left earwigging outside. The best that most backers can hope for is that Intu can flog off some assets. It isn’t a good market, though, and some of its shopping centres are part-owned. Rival Hammerson failed to hive off its retail parks last month. And there may not be much left once debt, accrued interest and break costs have been paid. The odds against finding a solvent solution to Intu’s woes are as big as its mega MetroCentre in Gateshead. Management can try talking tough and hope to save their jobs. But this will sound hollow with their backs pressed up against the wall of an empty mall.

Edited by Social Justice League
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1 hour ago, Brendan110_0 said:

Good for local town centres that have been decimated by out of town behemoths.

Shopping malls owned by Intu are not going to close. They will be sold, equity wiped out for shareholders but the viable ones will remain open. 

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1 hour ago, sammersmith said:

They just finished the Manchester Metrolink tram extension to the Trafford Centre about a week before lockdown. 

Trafford Centre is currently mostly locals, but the tram extension would have made the Trafford Centre feasible to tourists coming to watch a ManU game at Old Trafford. 

There's sweet nothing on the extended line other than the Trafford Centre. 

AJBell stadium just became a lot easier to get to with the Metro extension.

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21 minutes ago, ZeroSumGame said:

AJBell stadium just became a lot easier to get to with the Metro extension.

You can walk from Trafford Centre to AJBell? I didn't know that was even possible on foot. 

Also, Trafford Centre metrolink stop is the wrong end to get to AJ Bell. You'd have to walk through the full length of Trafford Centre to get out and a precarious route from then onwards.

They said they'd further extend the Trafford Park Line. Maybe they won't now if the numbers don't reach their pre-lockdown estimates.   

Edited by sammersmith
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25 minutes ago, sammersmith said:

You can walk from Trafford Centre to AJBell? I didn't know that was even possible on foot. 

I think you can, however there's a free bus, takes 3 or 4 minutes when traffic free times, 15 otherwise.

There really isn't much out there as you say, but that didn't stop builders chucking up apartment blocks everywhere.

But with COVID19 i guess that building frenzy is over.

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11 hours ago, GregBowman said:

Rode through North London into town today all commercial centres busy queues outside Primarks, JD Sports/Sports direct and H&M’s 

might be a blip but never under estimate the public’s appetite for tat 

Where my business is located in NW London the High Road never went quiet. Queues every day for Aldis, Tescos, Sainsburys, Poundland and the banks. Of course now that Primark, Tk Maxx and the like have re-opened, the street is packed all day and into the evening. A total contrast to the ghost town of central London.

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4 hours ago, Sausage said:

What happens to the shops inside that have just re-opened? Will they be forced to close again because the centre itself is shuttered? If that's the case that's really tough on them.

They would have to start paying rent.

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48 minutes ago, Trampa501 said:

Where my business is located in NW London the High Road never went quiet. Queues every day for Aldis, Tescos, Sainsburys, Poundland and the banks. Of course now that Primark, Tk Maxx and the like have re-opened, the street is packed all day and into the evening. A total contrast to the ghost town of central London.

As we discussed on the other thread but queues for Primark WTF ! Not sure where you are but I grew up in Muswell Hill and before the advent of Brent Cross etc - Wood Green, Edmonton, North Finchley, Enfield town were always packed at the weekend - no bad thing going back to supporting local commercial centres

Edited by GregBowman
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10 hours ago, ZeroSumGame said:

I think you can, however there's a free bus, takes 3 or 4 minutes when traffic free times, 15 otherwise.

There really isn't much out there as you say, but that didn't stop builders chucking up apartment blocks everywhere.

But with COVID19 i guess that building frenzy is over.

Where is the tram stop? There are a few other things in the area like the indoor ski slope.

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12 hours ago, Brendan110_0 said:

Good for local town centres that have been decimated by out of town behemoths.

I'd like to hope you're right but I'm sceptical. Out of town centres hit high streets and the internet was starting to hit out of town centres even before Covid-19 came along. Town centres also suffered badly from councils trying to bleed them dry but even if that changed I think the horse bolted long ago.

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1 hour ago, Riedquat said:

Where is the tram stop? There are a few other things in the area like the indoor ski slope.

Trafford Centre Tram Stop is outside John Lewis and near/under the bridge to the Barton Square extension.

i was being slightly facetious saying that there is nothing else on the Trafford Park extended tramline. You're right there are a few things around the Trafford Centre itself that are worth going to. However the rest of the line through the Trafford Park industrial estate there is nothing. Presumably most workers there will drive and Imperial War Museum / Old Trafford are already served by other nearby tram stops for the most part. 

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23 minutes ago, Social Justice League said:

Intu could go bust today by the look of it.  This is a big one and will take out quite a few out of town shopping centres for the foreseeable future.

Not really. 

The assets still exist when it goes into admin. 

Yes its a mess of a company but the creditors who are owed no less than 4 billion on it will want the centres to remain trading while they find a buyer. 

Some might do partial conversions to resi if a devloper buys but the viable ones will remain open. 

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Intu is one of the worst companies ever.  Only the brain dead would invest in that POS.

Good riddance to them !! 

Don't they own the Trafforrd Centre ? And various other 'flagship' shopping centres that sprang up during the last 20 years boom now here comes the bust !

 

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9 minutes ago, captainb said:

The assets still exist when it goes into admin. 

Their use as retail centers was unsustainably propped up by burning investor cash. The pyramid scheme is failing and that use will no longer be supported.

10 minutes ago, captainb said:

Yes its a mess of a company but the creditors who are owed no less than 4 billion on it will want the centres to remain trading while they find a buyer. 

Sometimes, creditors simply get to pound sand. They may not (probably will not) find a buyer at the price they need to be made whole.

Oh well, should have done your research.

8 minutes ago, captainb said:

the viable ones

Which are...?

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11 minutes ago, captainb said:

Not really. 

The assets still exist when it goes into admin. 

Yes its a mess of a company but the creditors who are owed no less than 4 billion on it will want the centres to remain trading while they find a buyer. 

Some might do partial conversions to resi if a devloper buys but the viable ones will remain open. 

I have read a few article that say if Intu goes into admin today, quite a few of their shopping centres will remain closed for the foreseeable future.  They are closed at the moment anyway, so it might not matter.

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40 minutes ago, Locke said:

Their use as retail centers was unsustainably propped up by burning investor cash. The pyramid scheme is failing and that use will no longer be supported.

Sometimes, creditors simply get to pound sand. They may not (probably will not) find a buyer at the price they need to be made whole.

Oh well, should have done your research.

Which are...?

Genius - you are aware that creditors who are owed a lot of money would rather get some back than "pound the sand"?

As per the last accounts the value of debts / assets was 67%. 

Lets be bearish and say the asset values have halved. That would be 134% LTV which would still give creditors back 70p in a £1. But hey why bother lets just pound the sand instead. 

 

As for being viable only INTU will know their per asset cashflow without the debt repayments. There will be of course alternative uses for the land that act as a prop for value. If city centre residential and if out of town, some residential but also building the large logistics warehouses that are so desperately in demand as people shift online. Not many sites large enough and near transport like those centres are.

But hey why bother with looking at alternative use when you can just pound the sand.

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  • 417 Brexit, House prices and Summer 2020

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      • down 5% +
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      • up 5%



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