Derwent London reports strong H1 leasing activity, rising rental values
Property investor and developer Derwent London Plc said on Tuesday that it had seen strong leasing activity and rising rental values throughout H1.
Derwent London said demand for its high-quality office spaces in central London had remained well above the long-term average, with supply constraints supporting pricing power.
Gross rental income ticked up 1.5% year-on-year to £109.1m, while net rental income dipped 1.1% to £94.0m. EPRA earnings per share slipped 0.9% to 52.2p, though IFRS pre-tax profits rebounded to £94.0m from a £27.2m loss a year earlier.
Net debt rose 4.7% to £1.55bn, with EPRA loan-to-value increasing to 30.5% from 29.9%, while interest cover fell to 3.2x from 3.9x, and net debt to EBITDA climbed to 9.7x.
However, the group reported £604m in cash and undrawn facilities, up from £487m at year-end, and lifted its interim dividend by 2.0% to 25.5p.
Open-market lettings were agreed 10.5% ahead of estimated rental values, with £13.8m of leasing, renewals, and regears completed year-to-date. Underlying capital growth turned positive at 1.2%, while total return improved to 3.0% from -1.0%.
Looking forward, Derwent London reiterated rental growth guidance of 3-6% for FY25 and confirmed over £200m of disposals had been completed or contracted, with proceeds earmarked for developments including Holden House and 50 Baker Street.
Reporting by Iain Gilbert at Sharecast.com
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