Landsec, one of Britain’s biggest property companies, has warned the economy is unlikely to recover from the impact of the Covid-19 pandemic until 2022 at the earliest, as it cut the value of its portfolio by nearly £1.2bn and prepared for more empty units at its shopping centres and offices. The company, which owns the Trinity Leeds shopping mall and Bluewater in Kent, as well as Deutsche Bank’s new London headquarters at 21 Moorfields, said the value of its property portfolio had fallen by 9%, or £1.18bn, to £12.8bn in the year to 31 March. Its retail portfolio lost more than 20% of its value, with regional assets worst affected, such as the Westgate Oxford mall, down 28%. This pushed the firm deeper into the red, with its loss before tax rising to £837m from £123m the previous year. Landsec’s new chief executive, Mark Allan, said: “While it is too early to predict outcomes with any certainty, it seems prudent to plan for more business failures and higher vacancy rates across our portfolio, in particular leisure and retail, and we don’t expect to see the economy recover to pre-Covid-19 levels before 2022 at the earliest.” Only essential shops such as supermarkets and pharmacies are allowed to open during the Covid-19 lockdown until restrictions are eased in June. Four of Landsec’s shopping centres are shut completely – Braintree Village in Essex, Hatfield Galleria in Hertfordshire, Junction 32 in Castleford, Yorkshire, and Clarks Village in Somerset. Its retail rent takings slumped, with only 38% of rent due on 25 March and 1 April collected compared with 90% for the same period last year. Overall, including offices, Landsec’s rent take fell to 63% in March and early April, compared with 94% a year earlier. Rent collection rates in June will be even worse, the firm said. Several cafe and restaurant chains, such as Pret a Manger, Starbucks and Burger King, have started to reopen for delivery and takeaway, but will not be allowed to open fully until July. Even then, consumers are expected to be very cautious about going out to socialise and shop. Net rental income fell by £35m last year, and Landsec took a £23m provision in relation to the current year’s rent. The vast majority of its office tenants’ employees are now working from home, with less than 10% of its office space being used. LandSec has set up an £80m rent relief fund to support its tenants, particularly cafes, bars and restaurants and small businesses, and is offering rent deferrals and monthly payments. In its most “severe but plausible” scenario, the company anticipates a recession in 2021 and higher inflation from next April, along with a 75% slump in retail rents and a 20% fall in office rents. Intu Properties, the owner of the Trafford Centre in Manchester and Lakeside in Essex, has also been hit hard by the Covid-19 crisis. It collected 40% of the rent due by the end of March.