Great Portland upbeat after encouraging quarter
Great Portland Estates today said it expected “supportive” conditions to persist throughout 2011, after issuing an update on its progress during the final quarter of 2010. It said it had seen a pick-up in leasing activity in its central London markets and sustained demand for quality investment properties during the three months to 31 December 2010, the third quarter of its financial year.
Toby Courtauld, the company’s chief executive, said in a statement to the London Stock Exchange that GPE had plenty of capacity for further expansion. It added one extra project to its 1.9m sq ft near-term development programme during the quarter. The company has two further deals under offer and expects to invest further capital this year. It also expects to make disposals at a faster rate in 2011, recycling capital from its assets once value has been added to them.
The continued solid growth in central London valuations helped lift the company’s portfolio value by 3.0% on a like-for-like basis to £1.55bn, after 2.6% growth in the previous quarter. Its West End offices portfolio rose 4.1% in value, while its City & Southwark offices offices gained 0.4% and its West End retail properties also increased by 0.4%.
GPE said occupational demand was “encouraging” during the quarter, especially for properties in the best locations, and added that tenant retention remained strong. “Across our portfolio, office rental values rose by 3.3% in the quarter, compared to the 2.9% increase recorded for the previous three months. West End office rental values were 3.6% higher whilst City and Southwark office rental values increased by 2.0%. Retail demand has been resilient and rental values in the West End portfolio climbed by 1.3% in the quarter,” it noted.
