Largest mall owner in Romania hopes its revenues won’t plunge amid Covid-19 shutdown

NEPI Rockcastle, the biggest mall owner in Romania by number of properties and the value of its portfolio, announced in a press release that large international and national retailers occupy 67% of the lettable area owned by the company, which reduces the risk of non-payment of the rent, Profit.ro reported.

The statement comes after the Romanian authorities have shut down all non-essential shops in Romanian commercial centres, particularly shopping malls, to limit the spreading of the Covid-19 epidemic. Hypermarkets and pharmacies have been permitted to continue operating.

Separately, the offices in Bucharest are also mostly empty as the authorities have restricted people’s circulation and most companies have sent their employees to work remotely for social distancing.

Despite this, NEPI Rockastle noted on a positive note that Auchan and Carrefour, two retail chains that the real estate investor expects to record higher than usual sales in the coming period, are two of the biggest tenants of NEPI’s shopping malls.

However, about 91.2% of the group's gross rental income comes from the fixed rent and only 3.3% is variable rent (paid according to receipts, over the fixed rent), Profit.ro notes.

Separately, the retailers’ sales might spike on the short term - but their increase remains debatable on medium to long term.

(Photo source: Nepirockcastle.com)