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(Alliance News) - CLS Holdings PLC on Thursday said its rent collection levels have been strong, but the office space provider cautioned that vacancy rates have climbed quarter-on-quarter, thanks in part to Covid-19 restrictions.
CLS, which has assets in the UK, France and Germany, said it has collected 93% of its second quarter rent, compared to 91% this time a year earlier. When adding in rents from tenants it has assisted by switching to monthly payments, collection levels rise to 95%, compared to 93% a year ago.
For the first quarter, it has now received 98% of rents due, up from 90% at CLS's last trading update back in January. A year ago, it collected 99% of first-quarter rent.
"Rent collection at 95% for the second quarter remains consistently strong. However, in terms of letting activity, the markets display a mixed picture across the countries. Vacancy rates have understandably increased as viewings are harder to conduct during lockdowns. However, we are starting to see increased lease enquiries as vaccination programmes are rolled out and economic activity picks up, which makes us cautiously optimistic for the remainder of the year," Chief Executive Fredrik Widlund said.
Group vacancy rates rose to 6.2% as of March 31, from 5.1% at the end of 2020. In the UK, vacancy rates climbed to 7.4% from 5.9%, while in Germany, vacancy rose to 4.5% from 3.6%. Vacancy rates in France inched up to 5.2% from 5.1%.
CLS added: "As expected, given the ongoing limitations of Covid-19 restrictions, vacancy has increased from 31 December 2020. This increase is primarily due to recent lease expiries across the portfolio. Vacancy will continue to increase short-term following the completion of the recent German acquisitions which were deliberately bought with vacancy as they provide excellent asset management opportunities."
Since the end of the first-quarter, CLS has made three acquisitions in Germany, forking out GBP147.8 million in total.
CLS shares were 0.4% higher at 232.50 pence each in London on Thursday morning.
By Eric Cunha; ericcunha@alliancenews.com
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