Shaftesbury prospers as West End, Covent Garden stay buoyant
Shaftesbury, the stock exchange-listed real estate company that owns a large number of properties in London’s West End/Carnaby area and Seven Dials/Covent Garden, reported its half-year results on Tuesday. And it seems the six months ended March 31 were good for the company.
Importantly, it said that “the West End remains largely insulated from the economic impact of national short- and longer-term uncertainties and challenges.”
Trading and footfall remained strong across the areas in which it operates and it's seeing buoyant demand for store space.
CEO Brian Bickell said: “The West End economy has been largely unaffected by business and consumer uncertainty following the 2016 EU referendum and the structural challenges facing national retail and restaurant chains. Interest in our space is good and occupancy remains high with occupiers recognising that the West End has a broad appeal to domestic and international businesses and visitors, as well as its large local working population, and a generally less price-sensitive customer base.”
In numbers, that translated into the company’s net asset value rising 13.6% to more than £3 billion, its net property income rising 5.5% £46.2 million and profit after tax up almost 21% to reach £123.7 million.
Shaftesbury said it's making good progress with its larger schemes. At Thomas Neal's Warehouse close to Covent Garden, terms have been agreed and it expects to conclude the lease shortly. And at 57 Broadwick Street, the retail and restaurant space is fully let.
And it made some big acquisitions in the first half, spending £117.4 million, including the freehold of 72 Broadwick Street in the Carnaby area and six buildings in Neal Street, Seven Dials. The acquisition of 35 and 36 Great Marlborough Street, Carnaby, for £22.7 million has been secured since March 31 as well. And its purchase of 90-104 Berwick Street, for £41 million is now expected to complete in spring 2019.
These developments are important as footfall to those areas has been increasing and is only expected to increase further. The opening of the giant transport project, the Elizabeth Line, will be crucial in boosting visitor numbers to the area. And that should also boost Shaftesbury's bottom line too. On Tuesday it said that its properties close to the Tottenham Court Road Crossrail hub may currently see rental rates that are “significantly lower than at the southern end, but with the benefit of growing footfall and our careful curation, we expect this differential in rents will narrow significantly over the medium term.”
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