Landsec’s Commercial Property Occupancy At 95.1%
UNITED KINGDOM – Landsec, one of the top commercial property landlords in the country, revealed that its commercial occupancy was stable at 95.1 percent at the end of September as demand for high-quality commercial space remains resilient, according to a press release published on Tuesday (15 November, SGT).
The company also revealed that it recorded positive leasing performance for its Central London offices and major retail destinations. In fact, £41 million in lettings have been completed or in solicitor’s hand during the six months ending in September, exceeding valuers’ assumptions by 3 percent.
However, Landsec swung to a loss after the value of its office properties in the City of London declined by nearly 10 percent. This also indicates that the higher interest rates could lead to a widespread downturn across the commercial real estate sector.
For six months ending in September, the landlord registered a pre-tax loss of £192 million compared to a £275 million profit in the same period last year as the valuation of its office space and retail units across the UK dipped by 2.9 percent to £10.9 billion.
The sharpest drop was recorded by its almost £2 billion portfolio of City of London offices, whose values declined by 9.7 percent year-on-year.
Nonetheless, the commercial property landlord divested £1 billion of mature office assets, including 21 Moorfields that clinched a 25 percent profit. This pushed up its overall London office disposals in the past two years to £1.8 billion at an average yield of 4.35 percent.