Wednesday, August 12, 2020

intu administration a major concern but Nottingham’s regeneration will continue, says Council

The announcement that intu has entered into administration is a major concern for cities and towns across the country where the company has shopping centres and a huge worry for the employees and retailers directly affected, according to the Leader of Nottingham City Council.

However, the Council says it is committed to major regeneration taking place in Nottingham including the transformation of Nottingham Castle, the new Nottingham College City Hub, a new Central Library, car park and bus station, major public realm improvements and the Island Quarter development.

City Council Leader, Councillor David Mellen, said: “The news about intu is hugely worrying for everyone involved, not least the thousands of people who work for the company across the UK, retailers based in their centres and the broader supply chain

“We will be seeking information and assurances from the administrators as a matter of urgency about their immediate plans in relation to both the Nottingham centres.

“Victoria Centre is a popular shopping centre with landmark stores and we see no reason why it cannot continue to operate successfully through the administration process. We will work to ensure access for residents of the Victoria Centre flats is maintained.

“At Broadmarsh, good progress was being made on the redevelopment before the global pandemic but unfortunately the retail sector has been particularly badly hit.

“As owners of the land we had for a number of years been seeking to bring about major improvements to what was a badly outdated shopping centre not fit for a major city in the 21st century. intu’s plans for the centre focussing on leisure as well as retail had been well received.

“Nottingham people will rightly feel let down that intu hasn’t been able to progress its plans. The current state of affairs is hugely disappointing but we will work to find a way forward.

“The company took the decision to pause construction work at the start of the pandemic. Since then, the Council has been in ongoing dialogue with intu about the future of the development and what could happen next in different scenarios under the terms of the comprehensive development agreement in place for the project.

“We will now continue those discussions with the administrator to ensure the interests of the city and the council are foremost and continue to be protected.

“We want to see this prime city centre site is developed in a way that will benefit the whole city, providing employment opportunities and enhancing our wider plans to regenerate the city’s Southside.

“The city, Government and private investors have shown confidence in our £2bn Southside plans and the Broadmarsh site forms a key part of that and we have been working on alternative plans while discussions have been ongoing.

“We are actively looking at options to put together an innovative, sustainable, affordable and achievable plan and will work with the business community, public sector partners and Government to achieve that.

“The rest of our exciting and transformational plans for the area are moving forward, with developments at the new Central Library, car park and bus station and Nottingham Castle ongoing and Government-funded scheme to create a much-needed welcoming entrance to the city set to begin in August. The new Nottingham College City Hub, major new office developments and significant numbers of residential developments are all taking shape.

“We are ambitious for the city’s future and the opportunities these developments will bring for local people, visitors and those looking to make investment decisions as the country makes an economic recovery from Coronavirus.”

Jim Tucker, David Pike and Mike Pink from KPMG’s Restructuring practice were appointed joint administrators to intu properties plc (the listed “Topco” of the intu group), in addition to eight Topco subsidiaries on Friday (26 June).

intu properties plc owns and operates 17 shopping centres across the UK. It directly employs circa 2,373 people.

Each of the shopping centres is owned individually by special purpose vehicles (“Propcos”) which are outside of any insolvency process and continue to trade as normal under the control of their directors.

An agreement has been reached with key stakeholders which will allow continued provision of central services to the Propcos. Consequently, all of the shopping centres will remain open and operational while the joint administrators assess options for the business and assets of the group.

Jim Tucker, partner at KPMG and joint administrator, said: “intu owns many of the UK’s biggest and best-known shopping centres. The challenges affecting UK retail are well known and have been exacerbated by the impact of COVID-19 and the resulting lockdown. As today’s administration makes clear, those challenges have fed through to owners of retail property, even to owners of high-quality shopping centres such as intu’s.”

David Pike, partner at KPMG and joint administrator, added: “With all centres remaining open, we look forward to working with staff, suppliers and other key stakeholders to preserve value and jobs in these important retail destinations.”

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