Unibail-Rodamco steps up mall renovation programme

Unibail-Rodamco has stepped up its renovation programme of its 'jumbo' shopping malls. Speaking during a conference call on the company's 2009 results, CEO Guillaume Poitrinal said the global economic crisis has made the renovation programme more urgent than ever. 'And the crisis makes it easier in the sense that it is easier to ask an under-performing tenant to leave when he really is under-performing. Our tenant rotation policy is more active than ever.'

'In places like France, it is much less expensive to evict these under-performing tenants in a period of crisis than when they are making money. So I can say we take advantage of the crisis to accelerate the metamorphoses and it will clearly benefit us and clearly benefit the company.'

Earlier this week Unibail-Rodamco reported that hefty declines in asset values pushed its losses for 2009 to EUR 1.46 bn from EUR 1.1 bn the year before. Recurring earnings per share grew in line with expectations to EUR 9.19 per share, a 7.1% increase over 2008, due to rental income growth and the contained cost of debt. Net rental income was up 3.4% on 2008.

Unibail-Rodamco is the largest listed property group in Europe and its EUR 22.3 bn portfolio consists primarily of dominant shopping centres in key European cities. The group also invests in office properties, mainly in and around Paris, and in convention-exhibition centres.

Around 50% of Unibail-Rodamco's shopping centre assets, with seven million-plus visitors annually, will be renovated and/or extended over the next five years. The marketing will also be intensified. No financial figures for the renovation programme were disclosed.

Le Forum des Halles in Paris and La Maquinista in Barcelona, which Unibail-Rodamco acquired from Spanish firm Metrovacesa in 2008, are among the assets earmarked for re-working.