Liberty International, which owns a string of major UK shopping centres, said it expects its flagship stores to benefit from the tough trading conditions facing Britain's retailers.
"The group's experience from previous downturns in retailing is that established prime regional shopping centres with the best retailers trading from flagship stores are exceedingly resilient," Liberty said yesterday .
It reported interim pretax profit in the six months to June 30 at £130 million, compared with £277.3 million a year ago. Underlying interim pretax profit prior to valuation items, exceptional charges and trading profits rose 6.3 per cent to £53.8 million.
Liberty said the slowdown in UK retail sales continued in the first half, particularly in the second quarter.
" However, comparison goods (fashion goods), which are predominantly the product-mix within our centres, have generally fared better than household goods which have been more severely impacted by the anticipated downturn in the UK housing market," it said.
The group is not directly exposed to pressures facing retailers, as its rental income growth is more correlated to rental cycles than to fluctuations in UK retail sales.
Given this, chief executive David Fischel said it was encouraging to see that more than half of the rise in Liberty's property valuations on its shopping centres came from increases in the valuer's estimate of rental values.
He said: "We look at it (the retail market) from the landlord's point of view and all we can say is our vacancy level remains very very low - 25 units out of 1,727 units - effectively our centres are full.
"A typical UK lease has a five-year rent review in it, so when we have a rent review we are picking up the last five years of growth - what we are not doing is picking up what has happened in the last few months on the high street."
Adjusted earnings per share was 13.3p, compared with 13.9p e a year ago. The decline reflected lower trading profits during the first half, the company said.
The company said it would pay an interim dividend of 13 pence per share.