GPE hails recovery for London’s office market
Great Portland Estates has posted further proof of a recovery in London’s economy and office market, swinging back to an interim profit and leasing more space over the six months than in the previous two years combined.
Chief executive Toby Courtauld said that although activity has yet to reach pre-Covid levels, “it is clear that London’s economy and its property markets are recovering”.
Office workers and shoppers are returning to the capital’s main commercial districts, he added, and growth in office jobs is driving a 50% rise in demand for City and West End offices compared to this time last year.
Great Portland Estates has posted further proof of a recovery in London’s economy and office market, swinging back to an interim profit and leasing more space over the six months than in the previous two years combined.
Chief executive Toby Courtauld said that although activity has yet to reach pre-Covid levels, “it is clear that London’s economy and its property markets are recovering”.
Office workers and shoppers are returning to the capital’s main commercial districts, he added, and growth in office jobs is driving a 50% rise in demand for City and West End offices compared to this time last year.
Over the six months to 30 September, the company posted a profit of £62.2m, having lost £154.8m in the same period a year ago. The portfolio value rose by 2% to £2.5bn, a 2.8% lift for offices more than offsetting a 0.8% fall for retail assets, and net tangible assets of 796p were up by 2.2%. The company posted a total property return of 3.7%.
The company leased more space over the six months than in the previous two years combined, securing £27m of new annual rent across 358,000 sq ft and beating rental value by almost 10%. It now has £2.4m of new lettings under offer and a further £16m in negotiations. Recent deals include leasing the entirety of 50 Finsbury Square, EC2 – a landmark refurbishment project in the company’s development pipeline – to satellite group Inmarsat.
“Whilst market volatility is possible in the near term, we expect these positive leasing trends to continue,” Courtauld said. “As a result, and assuming no further Covid restrictions, we have raised our guidance for our rental values and now forecast that they will rise for the full year in the range of +2% to +5%.”
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