# Great Portland Estates PLC Trading Update

- Link: https://www.directorstalkinterviews.com/great-portland-estates-plc-trading-update/412786905
- Published: 2019-07-04T07:26:56+01:00
- Author: Amilia Stone

**Great Portland Estates PLC** (LON:GPOR) today published its trading update for
the quarter to 30 June 2019.

**Continued leasing successes and capturing reversion**

 * 9 new lettings (35,400 sq ft) signed generating annual rent of £2.2 million (
   our share: £1.9 million); market lettings in line with March 2019 ERV

 * 7 rent reviews settled securing £2.3 million per annum; 17.2% above previous 
   passing rent; remaining reversionary potential of 7.5% (£7.7 million)

 * 12 lettings under offer totalling £3.7 million p.a. of rent (our share: £2.9 
   million), including 5,000 sq ft of retail at our Hanover Square development; 
   market lettings 9.4% ahead of March 2019 ERV

 * Flex and co-working space now 100,900 sq ft, 4.9% of office portfolio; appraising
   further 132,500 sq ft

 * Vacancy rate low at 4.2% (March 2019: 4.8%)

**Three committed development schemes progressing well; development programme 54%
of portfolio**

 * Good progress on our three BREEAM ‘Excellent’ committed schemes (414,900 sq ft),
   including Hanover Square, W1 which is already 53% pre-let or under offer; all
   located near to Crossrail stations, 19.1% forecast profit on cost, capital expenditure
   to come of £120.6 million. Good levels of occupier interest

 * Exceptional and flexible development pipeline; 10 schemes (1.4 million sq ft),
   income producing, 3.2 years average lease length, 9.7% reversionary^(1)

**Strong financial position; further surplus equity returned through share buyback**

 * LTV^(2) of 9.9%, weighted average interest rate of 2.7%, drawn debt 100% fixed
   or hedged

 * Cash and undrawn committed facilities of £578 million, low marginal cost of debt
   of 1.7%

 * Share buyback of up to £200 million ongoing; £96.9 million (13.5 million shares)
   purchased to date

_1. Existing use of development pipeline at 31 March 2019
2. Based on property values
at 31 March 2019

> **Toby Courtauld, Chief Executive, said**:
> “I am pleased to report continued positive activity over the first quarter with
> healthy leasing, excellent progress at our three committed development schemes,
> which are already more than 23% pre-let or under-offer, and further surplus equity
> returned to shareholders through our ongoing share buyback programme. The second
> quarter has started well with encouraging levels of enquiries from prospective
> occupiers attracted to our brand of high quality, well located space. Today we
> have £3.7 million of lettings under offer at a 9.4% premium to March 2019 ERVs.
> Whilst the current political uncertainties could lead to economic turbulence, 
> 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 including our exceptional development pipeline of more than
> 1.4 million sq ft 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.”

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