Investment case


Our key performance indicators (KPIs) measure the principal metrics that we focus on to run the business and they help determine how we are remunerated. Over the longer term, we aim to outperform our benchmarks through successfully executing our strategic priorities.

Total Shareholder Return (%) (TSR)


TSR is a standard measure of shareholder value creation over time. It measures the movement in a company’s share price plus dividends expressed as an annual percentage movement.


TSR of the Group is benchmarked against the TSR of the FTSE 350 Real Estate index (excluding agencies). The TSR of the Group was -7.2% for the year compared to -12.4% for the benchmark following an improved share price performance given our operational successes and reduced discount to NAV, combined with strengthening share prices of London office focused REITs following the 2019 general election.

Alignment with remuneration

Performance criteria for Executive Directors’ and certain senior managers’ long-term incentives.

Total Accounting Return (%) (TAR)


TAR is measured as absolute EPRA NAV per share growth (the industry standard measure of a real estate company’s success
at creating value) plus any ordinary dividends paid, expressed as a percentage of the period’s opening EPRA NAV.


We compare our TAR to a target year on year growth of 4%–10% used in our remuneration arrangements (see below). For the benchmark, we have used the minimum hurdle. TAR was 3.2% for the year as NAV growth was driven by retained earnings and the share buyback and we continued to deliver ordinary dividend growth. This resulted in a 0.8 percentage point relative under-performance for the year. For the year ended 31 March 2021, the Group will adopt the new EPRA metric of EPRA NTA. For the year ended 31 March 2020, the Group’s EPRA NTA and EPRA NAV were the same.

Alignment with remuneration

TAR is a performance criteria for Executive Directors’ and certain senior managers’ long-term incentives, and for Executive Directors’ and employees’ annual bonus.

Total Property Return (%) (TPR)


TPR measures a company’s performance at driving value from its property portfolio. It is calculated from the net capital growth of the portfolio plus net rental income derived from holding these properties plus profit or loss on disposals expressed as a percentage return on the period’s opening value as calculated by MSCI.


TPR is compared to a benchmark of £52.9 billion of similar assets included in the MSCI central London benchmark. The Group generated a portfolio TPR of 3.7% in the year whereas the benchmark produced a total return of 2.9%. This outperformance results from the strong performance of our committed developments in the year, in particular at Hanover Square and The Hickman, where we are delivering prime, Grade A space into a supply constrained market.

Alignment with remuneration

Performance criteria for Executive Directors’ and certain senior managers’ long-term incentives. The capital element of TPR is a performance criteria for Executive Directors’ and employees’ annual bonus.

New strategic non-financial KPIs for year to 31 March 2021

Given the growing importance of sustainability and our stakeholders to the success of our business, for the forthcoming year we will be introducing three new non-financial KPIs, all of which will be performance criteria for Executive Directors’ and certain senior managers’ annual bonus:


During the year, we entered into a £450 million ESG-linked revolving credit facility (RCF). Under the terms of the RCF, the margin we pay on the facility is subject to adjustment based on our performance against three challenging sustainability targets. To ensure these targets are further embedded into our behaviours, looking forward we will measure our aggregate performance against these targets as a non-financial KPI.

Occupier satisfaction 

High levels of occupier satisfaction are critical to both attracting and retaining businesses in our buildings. Looking forward, we will conduct an annual customer satisfaction survey to measure our relative Net Promoter Score (willingness to recommend) against our peer group, with a target outperformance of +2 points.

Employee engagement

Our people are fundamental to the success of our business and delivery of our business plans. We are committed to supporting and developing our people and maintaining high levels of engagement. Therefore, from next year, we will aim to maximise our Employee Engagement Index Score with a target performance of greater than 75%.

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