The past year brought unprecedented challenges for everyone. In response, we focused on two clear outcomes. The first was to do everything we could to ensure Landsec emerged from Covid-19 in as strong a position as possible.
The second was to re-examine the purpose, strategy and culture that will position us to achieve growth and make the most of Landsec’s undoubted potential. Here we describe what we did in these two areas of focus.
A global pandemic may not seem the best time to reconsider strategy, but Covid-19 has accelerated trends in retail and offices that otherwise may have taken many years to play out. We have formed a strategy that responds to these trends, and we have already started to implement it.
But while we planned for the future at Landsec, we also focused on the present challenges of Covid-19. Our response for our customers was rapid, flexible and always with safety at its heart. Inevitably, the impact on our customers and our business was still significant. Our like-for-like net rental income was down 30.4% and revenue profit was 39.4% lower at £251m. However, the action we have taken means our business remains healthy, we have retained strong relationships with our customers, and have a clear strategy for growth.
We were in regular contact with our customers to support them through the pandemic. We provided information packs and advice on how to establish safe working environments, and we explained what we would do to ensure our assets were Covid-secure. At each phase of lockdown and subsequent easing of restrictions, we worked with our customers to help them respond and operate in a safe and effective way. In early April 2020, we established a customer support fund of £80m for occupiers who most needed our help to survive. To date, we have agreed £42m of rent concessions for customers. In other cases, we allowed some customers to pay their rent monthly to help with cash flow, or deferred payment to a later date.
The health and wellbeing of our people remains our priority. Communication is crucial, so we established a business resilience team to guide our people during the year, with regular updates on how our offices and assets would operate, mental health and wellbeing support, additional advice for line managers to help them support their teams, and resource planning to ensure everyone could take their holidays and not miss out on vital family time. Throughout the pandemic, our recruitment remained focused on maintaining an inclusive workplace.
We continued with our community employment and education programmes throughout the last year. In addition, we gave grants totalling £500,000 to our existing charity partners who were most in need. Our directors waived 20% of their base salaries or fees for three months of the year, and we used this money to supplement these grants.
Read more about our community response.
Our on-site developments are controlled and operated by our contractors. We remained in constant communication with them throughout the year, to ensure our developments could progress while maintaining the safety of their people. We provided financial help too, paying £0.9m in topped-up furlough funds to service partners to allow them to pay 100% of wages.
Landsec will respond, as ever, in line with the values we hold as a business; values which override temporary turbulence and form the cornerstone of our promise to our employees, our customers, our partners and our communities.