8th May 2014 08:33
LONDON (Alliance News) - Derwent London PLC Thursday said it is continuing to see "deep demand" for its properties, with lettings signed above estimated rental values and low occupancy rates across the portfolio.
In an interim management statement for the period for the first quarter ended March 31, the London-focused property company said it signed lettings of 57,500 square feet worth GBP2.4 million in rent a year during the period. These lettings, excluding Middlesex House, were agreed at an average premium of 5% to the December 2013 estimated rental value.
The largest letting was the pre-let of the basement space at Middlesex House in Fitzrovia, London, where Derwent received planning permission to change car parking to offices. The tenant is taking 12,200 square feet at an initial rent of GBP500,000 a year on a 15-year lease with a tenant break option at year 10 and incentives equivalent to a nine-month rent free period.
Overall the company said its portfolio currently has an EPRA vacancy rate of less that 1%. EPRA is the European Public Real Estate Association, the industry body for European REITs.
In the year to date, the company said it made acquisitions worth GBP13 million, including an office building in Old Street for GBP11.8 million, and disposals worth GBP38 million, including a property near Oxford Street for GBP30.8 million.
"We continue to experience deep demand for Derwent London's brand of space," Chief Executive John Burns said in a statement. "This gives us the confidence to drive our extensive development programme forward and to reiterate our 2014 guidance for portfolio rental value growth of around 5% to 7% and for property yields to remain firm."
The stock was trading at 2,818.00 pence Thursday morning, up 58.00 pence or 2.0%.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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