Great Portland Estates (GPE) reported strong leasing activity in the three months to 31 December 2023, with its flex offer accounting for the majority of activity.
In a trading update, the company said it had completed 12 new leases and renewals in Q4 last year, generating annual rent of £5m, with space generating a further £6m of rent currently under offer.
At 16 Dufour’s Place (W1), GPE re-let the 2,200 sq ft fourth floor on a fully managed basis and at Woolyard (SE1) it completed four new leases all on a fully managed basis, generating additional rent roll of £1.8m per annum.
The company said it intends to refurbish 141 Wardour Street (W1) to provide 29,900 sq ft of new flex space in the heart of Soho.
Toby Courtauld, chief executive of GPE, said: “Operationally, we are pleased, once again, to have delivered a strong leasing quarter with £5m of new leasing deals, bringing the total deals for the financial year to date to £16.1m, 10.4% ahead of the valuer’s ERV. This success reaffirms our confidence in our portfolio rental value guidance of +2.5% to +5% growth for the financial year, with the best space potentially higher still.
“Despite a recent improvement in the outlook for interest rates, the macro-economic backdrop in which we operate remains challenging, limiting activity in our investment markets and placing selective upward pressure on yields, particularly for non-prime spaces. However, as we start the new year, we are encouraged by early indications that acquisition opportunities are starting to emerge.
“In this context, GPE is well placed. Despite rising barriers to entry in our markets, including a more challenging planning regime, our substantial capex programme is set to deliver the very best, sustainable spaces into a market starved of such supply; our focus on HQ development and our flex offer is meeting customer demand that is increasingly discerning; and with our strong balance sheet, plentiful liquidity and recycling opportunities, we remain well placed to capitalise on opportunities as they arise.”
