Shaftesbury Capital swings to net profit on strong leasing

(Sharecast News) - West End-focused real estate group Shaftesbury Capital said it saw "excellent" leasing activity across all property with rents rising by a tenth as it swing to a net profit in 2023. Net profit totalled £750.4m last year, compared with a loss of £211.8m in 2022 with the prior year impacted by a significant negative change in fair value of listed equity investment.

The company, which owns 2.9m square foot of lettable space across Covent Garden, Carnaby, Soho, Chinatown and Fitzrovia, said estimated rental value was up 6.9% in 2023, helping lift annualised gross income by 10.4% on a like-for-like basis to £192.8m.

Some 526 of leasing transactions were completed last year, representing £37m of rent, which was 10% ahead of 2022. Meanwhile, vacancy levels were low at just 2.1% of ERV available.

Looking ahead, Shaftesbury gave a confident outlook "despite the uncertain geopolitical and macroeconomic backdrop".

"Our strong performance and leasing pipeline together with positive trading conditions across our West End locations provide us with confidence in the growth prospects for our exceptional portfolio."

The company is targeting rental growth of 5-7% per annum over the medium term, which would result in average total property returns of 7-9%.

The stock was up 1.1% at 123p by 0918 GMT.