Landsec posted a loss before tax of £622m for the full financial year ended 31 March 2023 due to a -7.7% (-£848m) fall in portfolio value.
The developer recorded ERV growth of 3.6% with EPRA NTA per share down 11.9% to 936p and total return on equity at -8.3%. Landsec said it had reduced its net debt by £0.9bn thanks to the successful disposal of £1.4bn of mature offices mostly in the City of London.
Mark Allan, chief executive of Landsec, said: “Last year saw the most striking difference in performance between occupational markets and investment markets that I can remember. In investment markets, rapidly rising interest rates led to a sharp slowdown in transaction activity and falling asset values as valuation yields rose, whereas from a customer perspective, strong demand for Landsec’s best-in-class space drove consistently strong leasing, rising occupancy levels and growing rents across all parts of our portfolio.
“Our strategy is based on two clear and simple principles: focus our resources where we have sustainable competitive advantage and maintain a strong balance sheet. We have done both and, as a result, were able to navigate the challenges of the past twelve months very effectively. Our competitive advantages remain the high quality of our portfolio, the strength of our customer relationships and our ability to unlock complex opportunities.
“Looking forward, we expect the combination of a ‘higher for longer’ interest rate environment and the continuing concentration of customer demand on the very best space to result in exciting opportunities and continued positive rental growth for Landsec. Those competitive advantages will be more important than ever.”
