Struggling UK retail REIT Intu Properties has reportedly appointed KPMG as its financial administrator in case it fails to agree fresh terms with lenders this week, amid a spiralling debt crisis.
The firm, one of the UK's biggest shopping centre owners, is due to discuss standstill payment requests with its creditors over the next ten days, in a bid to stave off potential breaches of its debt commitments, precipitated by the coronavirus pandemic.
It said last week that it would ask to freeze repayments for the next 18 months, with requests to lenders including relief from financial covenant testing, debt amortisation and facility maturity payments, with interest switching to 'pay if you can'.
Intu had already warned that it might fail to meet its obligations by the end of June after struggling to net rental payments from retail tenants and seeing shopping centre valuations plummet during the pandemic. At the moment, it has secured waivers on its covenant tests in respect of its revolving credit facility until 26 June.
The landlord recently revealed that it had managed to collect just 29% of rents for the second quarter, compared to 77% in 2019.
Intu did manage to complete the sale of Puerto Venecia to Generali and Union Investment in May for €475 mln, but bondholders are said to be planning to seize assets, should the firm fail to cover its debts.
