Great Portland swings to profit, lifts rental value forecasts

(Sharecast News) - UK commercial landlord Great Portland Estates swung to a half-year profit and lifted its rental value outlook as Covid lockdowns were eased and shoppers cautiously returned to London's West End retail precinct.
The company on Friday reported a pre-tax profit of £62.3m for the six months to September from a loss of £155.2m a year earlier.

It also upgraded its full-year rental value growth range to between 2% and 5%, predominantly driven by the positive performance of its office portfolio.

"We are seeing healthy growth in office jobs which is driving renewed occupier demand for City and West End offices, up by more than 50% since this time last year," said chief executive Toby Courtauld.

However, Great Portland warned that the UK retail environment "continues to be challenged", with West End footfall levels still 30% below pre-pandemic levels.

"Whilst consumer confidence rebounded in the first half of 2021, and returned to pre-COVID-19 levels, confidence fell in the quarter to September 2021 for the first time since Q4 2020," the company said on Friday.

"City centres have continued to suffer as consumers have been slower to return to high density locations, particularly if they are reliant on public transport."

Great Portland, which has 2.5m square feet of Central London property, said its overall portfolio valuation was up 2% at £2.5bn and, like sector peers, reported strong demand for flexible working spaces, which now account for 15% of its office properties.

The results come as a survey revealed people in Britain turned more confident this month despite worries about inflation and were more willing to purchase expensive item.

The GfK Consumer Confidence Index rose for the first time in four months to -14 in November from -17 in October which was its lowest level since an early-2021 coronavirus lockdown.