By Kristy Dorsey

The owner of Braehead retail and leisure centre near Glasgow has confirmed it is in talks with a Hong Kong property giant to raise funds to cut its £4.7 billion debt pile.

Responding to renewed press speculation that a £1 billion cash call could be in the offing, Intu Properties said it is in talks with Link Real Estate Investment Trust “and other” new investors to launch a fresh equity fundraising at the end of this month alongside its full-year results. Property tycoon John Whittaker’s Peel Group, which owns 27.3% of Intu, is also involved in the discussions.

In a brief announcement to the London Stock Exchange, Intu described the talks as “constructive”.

Intu owns several major shopping centres throughout the UK and Spain, including the Lakeside in Essex and the Trafford Centre on the outskirts of Manchester. The latter was purchased in 2011 for £1.6 billion from Peel Group, which is currently Intu’s largest investor.

“The company will make further announcements in due course, as appropriate,” the statement concluded. “There can be no certainty that the equity raise will be implemented nor as to the terms on which any such implementation might occur.”

Link Real Estate Investment Trust is listed in Hong Kong, and has a market capitalisation of approximately £17 billion.

Investors have been fearful of putting money into retail real estate, where returns have been severely hampered by waves of closures that led to thousands of job losses last year.

Some names, such as Mothercare and Karen Millen, have disappeared altogether. Many others, such as Philip Green’s Arcadia Group, have staved off administration by closing large numbers of stores and negotiating lower rents through insolvency plans known as Company Voluntary Arrangements (CVAs).

Intu, whose shares have fallen by nearly 90% in the past year, hopes to regain some appeal among investors by reducing its debt pile. However, issuing new shares to raise extra cash also tends to push down the stock price, which doesn’t always go down well with existing shareholders.

Shares in Intu rose by nearly a quarter yesterday, adding 3.92p to close at 17.32p.