Q3 2022 BUSINESS UPDATE
ABOUT US
Derwent London owns and manages a £5.9bn office-led central London portfolio (30 Jun 2022). This makes us the largest London focused Real Estate Investment Trust (REIT).
We typically acquire properties off low capital values and modest rents in improving locations. We capitalise
on their unique qualities, taking a fresh approach to the regeneration of every building through asset management and refurbishment/redevelopment.
YTD (to Q3 2022)
H1 2022 SUMMARY
- £9.0m of new lettings on 141,000 sq ft, +12.7% above Dec 2021 ERV including Adobe, Brainlabs, Dept Agency, Marshmallow and VCCP
- £1.9m of Q3 lettings, 27.6% above ERV, with a further £1.1m under offer
- Francis House SW1 refurbishment (38,300 sq ft) completed and handed over to Edelman
- EPRA vacancy rate 6.9% at 30 Sep 2022, concentrated in recently completed space (30 Jun 2022: 6.5%)
- For the September quarter day, rent collected to date stands at 98%
- £139.0m of disposals in Q3 taking YTD activity to £204.9m including:
- Bush House WC2 for £83.9m, 41% above Dec 2021 book value
- 2 & 4 Soho Place W1 long leasehold interest for £39.7m
- Two West End net zero carbon developments underway:
- 25 Baker Street W1 (298,000 sq ft) - sub and super structure works progressing well
- Network W1 (137,000 sq ft) - works commenced on-site in Jun 2022
- Three exciting super-sites - see below
- EPRA LTV of 21.7%, down from 23.7% at 30 Jun 2022
- Net debt decreased by £156.2m in Q3 to £1.2bn
- Undrawn facilities and cash of £626m, up from £452m in Jun 2022
- 100% of debt at fixed rates with average maturity of 6.4 years
- First debt maturity (£83m at 3.99%) in Oct 2024
- Interest cover of 4.2 times, unchanged on Jun 2022
EPRA NTA per share | 4,023p: +1.6% |
(3,959p Dec 2021) | |
Net rental income | £93.9m: +4.2% |
(£90.1m H1 2021) | |
EPRA EPS | 53.13p: -1.7% |
(54.04p H1 2021) | |
Interim dividend per share | 24.0p: +4.3% |
(23.0p Jun 2021) | |
Valuation | +1.7% underlying |
MSCI* +0.8% | |
Total property return | +3.3% |
MSCI* +2.5% | |
True equivalent yield | 4.46% |
(4.50% Jun 2021) | |
- MSCI Central London Offices Quarterly Index
MANAGEMENT
Paul Williams, Chief Executive
Damian Wisniewski, Chief Financial Officer
Nigel George, Director
Emily Prideaux, Director
Robert Duncan, Investor Relations
OUR THREE 'SUPER-SITES'
50 BAKER STREET W1 JV | 230 BLACKFRIARS ROAD SE1 | OLD STREET QUARTER EC1 |
- Three buildings totalling 122,200 sq ft
- Acquired for £64.0m (50%) in Q4 2021
- Net initial yield of 4.0%
- 50:50 joint venture with Lazari Investments
- Close relationship with The Portman Estate, owner of the fourth building
- Proposed c.240,000 sq ft (100%)
- Timing: medium-term
- 60,300 sq ft multi-let office building, a residential block and a car park
- Acquired for £58.3m in Q2 2022
- Net initial yield of 3.5%
- 100-yearleasehold interest with ground rent fixed at £5k pa
- Major Southbank redevelopment opportunity (0.8 acres)
- Proposed 200,000+ sq ft
- Timing: long-term
- Exchanged a conditional contract to acquire former Moorfields Eye Hospital site - existing buildings c.400,000 sq ft
- Acquisition expected to complete in 2027 following vacant possession (£239m)
- 2.5 acre major regeneration opportunity
- Close to existing Tech Belt holdings
- Planning application to redevelop entire site to be submitted in 2023
- Proposed 750,000+ sq ft
- Timing: long-term
Derwent London plc 25 Savile Row London W1S 2ER | T: 020 7659 3000 | www.derwentlondon.com
MAJOR DEVELOPMENTS PIPELINE
Capex to | |||
Area | complete | ||
Property | sq ft | £m1 | Comment |
On-site major projects | |||
25 Baker Street W1 (completion H1 2025) | 298,000 | 241 | 218,000 sq ft offices, 52,000 sq ft residential and |
28,000 sq ft retail (10% pre-sold overall) | |||
Network W1 (completion H2 2025) | 137,000 | 105 | 132,000 sq ft offices and 5,000 sq ft retail |
435,000 | 346 | ||
Next phase | |||
Holden House W1 (consented) | 150,000 | - | Earliest possession 2025 |
50 Baker Street W1 JV (under appraisal) | 240,000 | - | 100% share (50:50 JV) |
1 As at 30 Jun 2022
H1 2022 MAJOR COMPLETIONS
Soho Place W1 | The Featherstone Building EC1 |
- 285,000 sq ft of offices, retail and theatre above Tottenham Court Road station
- 88% let/sold (£17.7m pa contracted income)
- Total ERV £20.9m (Office ERV £92.50 psf)
- 125,000 sq ft scheme adjacent to White Collar Factory
- Offices with 2,000 sq ft of retail
- 22% let at £2.2m pa, 10% above Dec 2021 ERV
- Total ERV £8.8m net (Office ERV £72.50 psf)
RECENT COMMENCEMENTS
25 Baker Street W1 | Network W1 |
- 298,000 sq ft mixed-use scheme (10% pre-sold)
- Commenced Oct 2021 with completion H1 2025
- Total ERV £18.4m net (Office ERV £90.00 psf)
- Capex to complete £241m (Jun 2022)
- 137,000 sq ft office-led scheme
- Commenced Jun 2022 with completion H2 2025
- Total ERV £11.9m net (Office ERV £87.50 psf)
- Capex to complete £105m (Jun 2022)
Derwent London plc 25 Savile Row London W1S 2ER | T: 020 7659 3000 | www.derwentlondon.com
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Derwent London plc published this content on 09 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 November 2022 10:40:01 UTC.