Great Portland Estates (GPOR.L: Quote, Profile, Research) posted a 2 percent fall in adjusted net asset value on Wednesday and said demand for its core London properties would cling to long-term average despite shaky economic conditions.
In results for the year to end-March on Wednesday, Great Portland said its adjusted net assets per share fell to 582 pence after capital market turbulence extinguished a trend for debt-driven property buying, which sent London commercial property prices soaring in the past three years.
Although fearful pressurised money markets and a lack of confidence might deepen the UK property correction going forward, Great Portland said its focus on the undersupplied West End market would underpin its long-term prospects.
“So long as the UK economy avoids a significant contraction, the key variable, the demand for space (in London’s West End), although expected to slow from its recent high levels, should remain around the long-term average,” it said in a statement.
Great Portland said the value of its property portfolio slipped just 0.2 percent to 1.636 billion pounds ($3.20 billion) on a like-for-like basis over the year.
It generated a total property return of 2.6 percent, trumping the Investment Property Databank central London yardstick by 7.4 percent.
Reflecting consistent demand for space at its properties, it reported a 33.1 percent hike in rental and joint venture income to 72 million pounds and a 36.8 percent rise in adjusted pretax profits to 23.8 million pounds.
Tags: asset value, assets, Bank, central london, consistent demand, contraction, economic conditions, gpor, Investment Property, investment property databank, lack of confidence, london properties, market turbulence, net assets, nvestment Property, orr, pence, pretax profits, property portfolio, term prospects, uk economy, west end, yardstick