Following three years of stagnant rents across the London office market, Derwent London (DLN) feels it can be more “aggressive” in putting up rates due to increased demand and greater political certainty, said chief executive Paul Williams. The group has improved guidance for estimated rental value (ERV) growth this year to between 1 and 4 per cent, compared with the 1.4 per cent rise in ERV in 2019.
The West End office landlord and development group completed new lettings on just under 500,000m sq ft of space, contributing £34m in annual rental income and 7.6 per cent ahead of ERV at the end of December 2018. The vacancy rate also fell to just 0.8 per cent.
Management is now accelerating its development activity, buoyed by a conservative loan-to-value ratio of just 16.9 per cent. Three projects are on site and 72 per cent pre-let, while planning consent has been secured on a further two sites, including 19-35 Baker Street.
Analysts at Panmure Gordon forecast adjusted NAV of 4,079p at the December 2020, rising to 4,254p in 2021.
DERWENT LONDON (DLN) | |||||
ORD PRICE: | 4,312p | MARKET VALUE: | £4.82bn | ||
TOUCH: | 4,308-4,314p | 12-MONTH HIGH: | 4,362p | LOW: 2,858p | |
DIVIDEND YIELD: | 1.7% | TRADING PROP: | £40.7m | ||
PREMIUM TO NAV: | 9% | ||||
INVESTMENT PROP: | £5.2bn | NET DEBT: | 22% |
Year to 31 Dec | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2015 | 3,528 | 780 | 695 | 43.4 |
2016 | 3,561 | 55 | 53 | 52.26 |
2017 | 3,703 | 315 | 282 | 59.73 |
2018 | 3,776 | 222 | 199 | 65.85 |
2019 | 3,958 | 281 | 254 | 72.45 |
% change | +5 | +27 | +28 | +10 |
Ex-div: | 30 Apr | |||
Payment: | 05 Jun |