13th Nov 2013 11:18
LONDON (Alliance News) - Derwent London PLC Wednesday said it has achieved record lettings in the year to date, generating annual rental income of GBP21.1 million at 10% above December 2012 estimated rental value (ERV).
In a third-quarter interim management statement, the central London-focused real estate investment trust (REIT) said lettings in the second half to date totaled 121,200 sq ft at an annual rent of GBP5.6 million, 11% above June 2013 ERV
In the third quarter to September 30, Derwent said it let 62,300 square feet at an annual rent of GBP2.7 million, 4.0% above the June 2013 ERV. So far in the fourth quarter, it has let 58,900 square feet at an annual rent of GBP2.9 million, 18% above June 2013 ERV.
The REIT said its European Public Real Estate Association (EPRA) vacancy rate is now only 1.2%, down from 2.4% in June 2013.
Derwent has also added to its portfolio through the GBP39.6 million acquisition of 19 Charterhouse Street, a 63,700 square-foot freehold office building in the "Tech Belt" of east London.
The group has a further GBP60 million property acquisition in solicitor's hands.
"The rental growth and strong demand we see for Derwent London's brand of space, together with the improving economic outlook, mean that we are confident that our portfolio's estimated rental value growth will be at the top end of the 4-6% range that we predicted for the year," Chief Executive John Burns said in a statement.
"New lettings are achieving significantly above this level. Our successful refinancing means that we are now even better placed to fund our development pipeline and invest in additional properties," he added.
Derwent said there had been three major financing transactions since June 2013.
In July it issued GBP150 million of convertible bonds due in 2019, the conversion price of these bonds was set at GBP33.35 per share, a 62% premium to EPRA net asset value per share at the end of June 2013.
In September Derwent London completed and started to draw down a new GBP550 million unsecured five-year revolving credit facility, replacing GBP650 million of secured bank facilities expiring between April 2014 and January 2017. The new facility was provided by Derwent's principal relationship lending banks.
The REIT also signed terms with New York Life for an unsecured private placement of GBP100 million. It said this latest financing piece provides long-term debt at attractive pricing.
Derwent shares at 2,420.00 pence Wednesday morning, down 22.00 pence or 0.9%.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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