Helical boss predicts crunch time in office market

Helical chief executive Gerald Kaye has said questions around the return to the workplace will drive a “growing divergence ­between Grade A buildings and the rest”. In response to a strong year-end, Kaye said Helical is positioned to succeed in this new environment. The group reported a total property return of 9% for the year ended 31 March, compared to the MSCI central London offices total return index of 4.5%. The see-through total property return nudged up by 3% to £83.9m, with rental income up by 13% to £28.5m, with a number of practical completions in the year. Helical saw a 5.5% increase in the portfolio’s NAV to £598.7m, with EPRA NNNAV up by 3.2% to 480p. It reported profits of £43m, with £9m in development gains. Kaye said: “For the office sector, questions are being asked about the desire to return to previous working practice. “We anticipate there will be a growing divergence in the office sector between Grade A buildings and the rest. “That response from both occupiers and investors following Covid-19 is likely to accelerate this process and we are confident that the successful delivery of our strategy in recent years means we are positioned on the right side of this gap.” He said the company has robust finances, with £279m of cash and undrawn bank facilities and it would seek to protect shareholder value and “meet the challenges that the coming months will bring”. Helical will pay a dividend of 6p per share, down by 20% from the previous year, as the business seeks to reduce outgoings and preserve cash resources “in the current uncertain market”. Kaye added that it will “pursue its strategy of growing the business when the opportunities arise.” To send feedback, e-mail emma.rosser@egi.co.uk or tweet @EmmaARosser or @estatesgazette