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22 Jul 2009 07:00
22 July 2009ο»Ώ
Helical Bar plc ("Helical" or the "Company")
Interim Management Statement for the first quarter to 30 June 2009
Market Update:
Since reporting to shareholders in the preliminary announcementΒ of 4 June 2009,Β Helical has seenΒ an improvement in valueΒ in respect ofΒ propertiesΒ let onΒ long leasesΒ toΒ tenants of undoubted covenant strength.Β Β In particular, we are seeing positive yield movement in prime West End and City office investments,Β A1 out-of-town retail parks,Β industrial estates in the South East and in the auction market. However, average propertyΒ values continue to fallΒ as a consequence ofΒ decliningΒ rental values and investors need to exercise great caution. Helical andΒ itsΒ partners areΒ currentlyΒ assessing aΒ number of potential acquisitions and remain confident thatΒ itΒ canΒ takeΒ goodΒ advantage ofΒ continuing market uncertainties, whilst maximising the significant upside in its development and investment portfolio.Β
Key activity:
During the quarter we completed 23Β lettings, increasing ourΒ annualisedΒ income by Β£356,000. This included 14 lettings in the Hub, Glasgow (totallingΒ Β£146,000Β perΒ annum) and Tile Giant completing a leaseΒ (Β£40,000 per annum)Β of the front unit of our trade counter development in Southampton.Β
We completedΒ sixΒ lease renewals, securing Β£455,000Β ofΒ annualΒ rent. Rent free periods came to an end onΒ threeΒ leases, adding Β£95,000Β perΒ annum. This more than offset the impactΒ ofΒ fourΒ tenants either vacating their propertiesΒ orΒ goingΒ into administration,Β with the consequent loss of Β£56,000 of income per annum.
At Riverbank House,Β London EC4,Β where we are acting as development managers for the new Man HQ for City of London and Pace Investments,Β construction is several weeks ahead of schedule and the building was recently topped out.
At Exeter a planning application for a retirement village of 248 units has been submitted.
AtΒ Bramshott Place,Β our retirementΒ village development in Liphook, progress on sales continues to be encouraging. We have exchanged or completed on 10 units (Β£3.5m) and a further 17 (Β£6.9m) areΒ under offer, leaving a further 15Β currently available to buy in Phase 1. We have also released 13 units in Phase 2,Β sevenΒ of which (Β£3.5m) are under offer. The Clubhouse at the centre of this development will open in September.Β
The retail development at Wroclaw, Poland is fully let and trading well. The other Polish retail developments at Opole and Europa Centralna, GliwiceΒ are progressing as scheduled andΒ both sites are expected to be 70% pre-let by autumn 2009. Since 1 April 2009 we have completed leases on 73,400 sq ft with a further 40,000 sq ft in solicitors'Β handsΒ bringing the total to 560,000 sq ft.
In our development portfolio, the sale of aΒ 5,200 sq ft unit at Cowley, Oxford has completed leaving us with two remaining units. At Southall, demand remains relatively strongΒ despite the tough market. Sales of two units, totalling Β£2.3m, have been completed since March with a number of other units under offer.
Helical has renegotiated Β£134m ofΒ debtΒ removing loan to value covenants for betweenΒ twoΒ toΒ threeΒ years on these loans, thereby enhancing the Company's financial and operational flexibility.Β
Commenting on the Company's activity, MichaelΒ Slade, Chief Executive, said:
Β "After two years ofΒ marketΒ uncertainty,Β Helical is now firmly on the front footΒ with both its existing portfolio as well asΒ in respect ofΒ potential opportunities.Β We have made good progress with ourΒ asset management initiatives during the quarter,Β securingΒ Β£850,000Β ofΒ annual incomeΒ in our investment and UK development portfolioΒ and ourΒ planning and construction work is proceeding well. In addition, it is pleasing to report a total of Β£16m of sales either completed or inΒ solicitors'Β hands.
"We are now starting to see much improved signs inΒ parts ofΒ the UK market, with the valuation of certain types of assets clearly levelling out. The market remains a "curate's egg" and best left to experienced stock pickers, but one in which HelicalΒ willΒ deliverΒ value for our shareholders."
For further information, please contact:
|
Helical Bar plc Michael Slade (Chief Executive) Nigel McNair ScottΒ (Finance Director) Address: 11 - 15 Farm Street, London, W1J 5RS Fax: 020 7408 1666 Website: www.helical.co.ukΒ |
Tel: 020 7629 0113 |
|
Financial Dynamics Stephanie Highett/Dido Laurimore/Laurence Jones |
Tel: 020 7831 3113 |
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