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(Alliance News) - Globalworth Real Estate Investments Ltd on Monday said its occupancy rate in the first six months of 2020 declined due to a slowdown in momentum as a result of the Covid-19 pandemic, but the rate of collections for rents invoiced and due remained high at 92.7% during the period.
The company also said that first half leasing activity was "healthy" with 115,500 square metres of commercial space taken-up or extended at an average weighted average lease length of 3.2 years. Leases renewed accounted for 74% of the company's leasing activity
The real estate investment company with investments in Romania and Poland saw 92 of its 123 tenants renew their leases in the first half ended June 30.
"The strong leasing momentum of the previous years in our markets of focus in Poland and Romania, came to a sudden slowdown in the last three months due to the Covid-19 pandemic, with several companies forced to re-assess their occupational plans as well as the duration of the leases signed," Globalworth said.
The average standing occupancy of Globalworth's commercial portfolio was at 93%, down from 95% at 2019-end. Like-for-like occupancy rate decreased by 0.8%.
Claims accounted for 2.4% of the annualised contracted rent received and settled with tenants, and further claims accounted for 2.3% of annualised contracted rent rejected under negotiations. Most claims were received by tenants impacted by Covid-19.
Globalworth Co-Chief Executive and Chief Investment Officer Dimitris Raptis said: "The quality of our portfolio, our small exposure to the retail segment of the market, the significant cost savings achieved during this period and the strength and depth of our platform have contributed to achieving solid operating performance, demonstrating the strong resilience of our business amidst this unprecedented crisis."
Separately, Globalworth said it plans to issue new notes under its EUR1.5 billion euro medium term note program.
The company plans on using the notes to extend its debt maturity profile and redirect its financing resources toward green projects.
In addition, Globalworth announced a tender offer for the holders of an outstanding EUR550.0 million in notes due on June 20, 2022.
The company said it will pay a cash purchase price equal to EUR1,020 per EUR1,000 in principal amount of the outstanding notes.
The London branch of Deutsche Bank AG and J.P. Morgan Securities PLC are acting as the dealer managers for the tender offer.
Globalworth shares were up 1.8% at EUR5.80 each on Monday in London.
By Greg Roxburgh; gregroxburgh@alliancenews.com
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