(Alliance News) - Great Portland Estates PLC on Friday said it is "well positioned" despite challenges presented by Covid-19, which are expected to have a negative effect on its financial 2021 earnings.
The London-based property development & investment company said it collected 69% of June rent to-date, including amounts covered by rent deposits. Excluding deposits, rent collection stood at 58%.
Great Portland Estates said all of its office buildings remain open for business, with levels of occupier utilisation currently around 14% of full occupancy and, following the recent easing of the lockdown rules, around two-thirds of its retail units have reopened.
During the quarter to June 30, Great Portland Estates said it signed four new leases and renewals generating GBP4.3 million in annual rent, and noted its vacancy rate at the quarter-end stood at 3.3%.
Chief Executive Toby Courtauld said: "Whilst the lockdown has started to ease and our office pre-letting momentum remains healthy, Covid-19 is disrupting the activities of many of our existing occupiers, which in some instances is impacting their ability to meet their rental payments."
Courtauld said the firm is "well positioned" despite the "challenging" conditions.
Looking forward, Great Portland Estates said it expects to benefit from an acceleration of demand for its brand of flexible office space once the immediate impact of Covid-19 has passed.
The company also said it expects that a combination of rental concessions and potential occupier delinquencies will have a negative impact on earnings per share for the year ending March 2021, although noted that, at this stage, "it is too early to quantify further".
At June 30, the FTSE 250-listed company said its consolidated net debt was GBP368 million, up from GBP349 million as at the end of March. The increase was largely due to on-going development capital expenditure across the firm.
"Our leverage is low providing strength in these difficult markets with significant capacity for growth should opportunities emerge; our portfolio is almost fully let and our extensive development pipeline is set to deliver high quality, sustainable spaces that remain in high demand; this, combined with the talents of our experienced team and strong culture, means that we have the ability to choose our path to deliver on all our ambitions," he added.
Shares in the company were down 0.4% at 606.40 pence each in London on Friday morning.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
