Annual results - developments driving strong operational performance

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The Directors of Great Portland Estates plc announce the results for the Group for the year ended 31 March 2019.

Highlightsfor the year include: 

Robust financial performance; ordinary dividend growth of 8.0%

  • EPRA2 NAV per share of 853 pence, up 1.0% over twelve months; net assets of £2,309.7 million
  • EPRA2 earnings of £53.7 million, down 19.2% on 2018 following £348.9 million of asset sales
  • EPRA2 EPS of 19.4 pence, down 4.9%. Cash EPS of 17.1 pence, up 0.6%
  • After revaluation surplus, IFRS profit after tax of £56.1 million (2018: £76.7 million)
  • Total dividend per share of 12.2 pence, up 8.0% on 2018, including final dividend of 7.9 pence, up 8.2%
  • Total accounting return of 2.3% (2018: 7.2%)

Valuation stable, with committed developments performing well; rental value growth of +1.23%

  • Portfolio valuation up 0.2%3 (developments: up 4.1%2), down 0.4% in H2
  • Rental value growth of 1.2%3 (+1.9% offices, -0.6% retail); yield expansion of 1 bp
  • Total property return of 3.5%, with capital return of 0.3% v IPD Central London of 1.1%
  • Rental value growth guidance for new financial year; range of +1.5% to minus 2.0%

Excellent leasing performance, 6.9% ahead of ERV; embracing opportunity with flex space offering

  • Rent roll up 6.2%3 to £100.4 million, with total potential future growth of 51% to £152.0 million
  • 78 new lettings (annual rent of £24.5 million, 326,000 sq ft), market lettings 6.9% above March 2018 ERV (with H2 lettings 8.4% above March 2018 ERV)
    • Second major pre-let at Hanover Square, W1 to Glencore UK Ltd, 53,900 sq ft on 20 year term (no break)
    • 87,600 sq ft flex and co-working space delivered, rent at 30%premium; appraising further 124,300 sq ft
  • 27 rent reviews securing £13.3 million, 19.2% ahead of passing rent, 3.3% ahead of ERV at the review date
  • Vacancy rate of 4.8%, average office rent of £55.20 per sq ft, reversionary potential of 8.3% (£8.3 million)

Good progress on committed schemes and extensive pipeline of opportunities (54% of portfolio)

  • 160 Old Street, EC1 (161,700 sq ft) completed in April 2018, now 94% let; 26.8% profit of cost
  • Three committed schemes (414,900 sq ft) progressing well; all located near to Crossrail stations, targeting BREEAM Excellent and 19.1% forecast profit on cost. 21% pre-let with encouraging occupier interest
  • Flexible development pipeline of 10 schemes (1.4 million sq ft), all income producing, 3.4 years average lease length; planning application submitted for 373,100 sq ft scheme at New City Court, SE1

£348.9 million of sales, broadly in line with book value; balanced outlook for sales and acquisitions

  • 160 Great Portland Street, W1 sold for headline price of £127.3 million, crystallising surplus since development commitment of 101%
  • 55 Wells Street, W1 sold for £64.6 million, net initial yield of 3.99% and capital value of £1,674 per sq ft
  • Four smaller commercial sales and ten residential sales, all W1, totalling £157.0 million

Exceptional financial strength and discipline

  • Loan-to-value of 8.7%, weighted average interest rate of 2.7%, weighted average debt maturity of 6.4 years, cash and undrawn facilities of £608 million
  • £380 million of surplus equity returned to shareholders during year, with flexible share buyback programme of up to £200 million continuing

Market leading ESG supported by strong culture

  • Sustainability integral to our success; GRESB 5 star and new ambitious carbon targets
  • Innovating & future proofing portfolio; dedicated Occupier Services Team & new market leading app
  • Enhancing team & culture; 'Together We Thrive' values launched and promoting internal talent


1. All values include share of joint ventures unless otherwise stated 2. On a like-for-like basis  3. In accordance with EPRA guidance  4. Comparison to a combination of outperformance of March 2018 net effective ERV and net effective rent achievable on short term letting ahead of development.

EPRA and adjusted metrics: we prepare our financial statements using IFRS, however we also use a number of adjusted measures in assessing and managing the performance of the business. These include measures defined by EPRA, which are designed to enhance transparency and comparability across the European real estate sector, see note 9 to the financial statements.


"The GPE team is operating well. Against a backdrop of elevated political and economic uncertainty, we are pleased to have delivered many successes over the past year; with another strong leasing performance, we’ve beaten rental value estimates and pre-let more of our committed developments, ahead of schedule, to global businesses; we’re innovating across our operations, introducing new technology, and evolving our product to suit the changing patterns of occupier demand; we’ve successfully progressed our pipeline, the quality and size of which means we have ample raw material for years to come; and through our disciplined approach to capital management, we’ve crystallised surpluses through asset sales, returned surplus equity to shareholders and maintained our exceptional balance sheet strength with our loan to value ratio at only 8.7%. Whilst we can expect political and possibly economic turbulence over the year ahead, we remain convinced of the long-term, enduring appeal of our capital city and its property markets to businesses and investors alike. With our clear strategy, exciting portfolio and talented team, supported by our collaborative culture, deep market knowledge and financial strength, we have the capacity to choose our path to maximise returns for shareholders and we look to our future with confidence."
Toby Courtauld
Toby Courtauld
Chief Executive