What Does The Coronavirus Pandemic Mean For The Long-Term Redevelopment Of Burgess Hill Town Centre?
25th March 2020 |
As the UK and the rest of the world continue its efforts to suppress the Covid-19 virus, thoughts in Burgess Hill will also be on the prospect of NewRiver Retail's redevelopment of the Martlets Shopping Centre.
The company's share price has fallen 65% from £1.81
to just 60p in the last month.
Last week, they suspended their fourth-quarter dividend of 5.4p, as well as all non-essential capital expenditure, alongside reductions in operating expenses.
In a statement, NewRiver said:
'The company has already undertaken extensive scenario testing, factoring in the loss of income from its pub portfolio, which confirms that NewRiver has significant covenant headroom and a capital structure that is well placed to absorb a prolonged period of uncertainty,'
As a result of government economic interventions to provide assistance to businesses affected by coronavirus, the company and its tenants will save £5m in cash flow over the next 12 months by deferring business rates payments.
In addition, 80% of the wages of employees who can’t work will be paid by the government.
The business is also talking with its insurers to make a claim for the business disruption caused by Covid-19 and for loss of rent.
Cineworld's Future Is The Key To Burgess Hill Town Centre's Redevelopment?
One of the anchor tenants
lined up for the Martlets Shopping Centre are also facing a very troubled time. Cineworld's shares dropped from £1.89 to 21p in less than a month (now sitting at 60p at the time of publishing this article), with their theatres across the world having to close during the pandemic.
Cineworld said a worst case scenario for the coronavirus outbreak, with moviegoers in the UK and US staying at home for three months, this would lead to “material uncertainty” and “may cast significant doubt about the group's ability to continue as a going concern”.
Management said that while the coronavirus had currently only had a “minimal impact” on the business, there could be “no certainty” of how the firm’s performance would be affected if the virus continued to spread.
So What Happens Now?
We're still waiting for NewRiver Retail's revised scheme to come before the MSDC District Planning Committee. *If* it gains approval, it pretty safe to think that an Autumn 2020 start date on construction is now out the window, it could even take years. Maybe NewRiver's board will pull the plug altogether and focus on less costly projects going forward?
If Cineworld make it through the other side of the Corona Virus, will they be looking to open new cinemas? You'd imagine a long period of consolidation or even a reduction in the number of picture houses in their portfolio would be more likely. If they pull out, the figures may not make redevelopment of the centre worthwhile anymore
Very uncertain times ahead for Burgess Hill Town Centre.
|Spread the word! The redevleopment of the Martlets Shopping Centre could be under threat
Got an opinion on this story? Leave a comment below.....
What do you think the effects of the coronavirus will have on NewRiver's ability to redevelop the Martlets Shopping Centre at any point in the future?