UK leads in URW shopping centre rental growth

The UK was the star performer for rental growth across Unibail-Rodamco-Westfield’s shopping centre portfolio in the first three months of 2024. New figures from the group show a 21.6% growth in rental income from its UK malls, up from €24.5m (£21m) in Q1 2023 to €29.8m in Q1 2024. The double-digit growth was not enough to boost rental income across its global shopping centre portfolio, however, which dipped by 0.9% to €492.1m. The US was the biggest drag on shopping centre rental growth, with figures down by 20.8% to €89.3m. Overall, turnover across the business was up by 5.3% to €799m. The growth across URW was driven by a 54.1% increase in turnover across its convention and exhibition assets to €116.4m and its offices division, where a 28.9% hike in service charge income boosted revenues to €30.4m. URW said that an early impact from the 2024 Paris Olympics and Paralympics had boosted its convention business, with completed, signed and pre-booked events across its venues already accounting for 96% of its 2024 expected revenues. Shopping centres remained the core driver of income, however, contributing more than €600m to total turnover. URW said that leasing activity was down slightly year-on-year, with 557 deals signed in Q1 2023 and 521 signed in the first three months of this year. Vacancy level across the group currently stand at around 5.7%. In the UK, vacancy rates are 7.2%, down from 9.3% in Q1 2023. The group added that it was in “active discussions” with a number of potential buyers for more than €1.2bn of assets in Europe and the US as part of its ongoing disposals strategy. “After a challenging 2023 for investment market activity, investor interest seems to have improved since the beginning of the year,” said the firm. “URW remains committed to further deleveraging through disposals in Europe, in line with its long-standing capital recycling policy, and in the US.” Photo by Dinendra Haria/Shutterstock