Great Portland delivers record rental income

Crucially, activity and pricing in central London’s commercial property market remained robust for prime assets. Great Portland has the added advantage of having 86 per cent of its portfolio conveniently situated close to Crossrail, which opens in late 2018. This was reflected in a £16.9m valuation uplift in the property portfolio, compared with a £90.3m devaluation a year earlier.

Great Portland expects to see lower levels of growth and businesses deferring investment decisions having an adverse impact on occupational markets. However, the group’s focus is on the West End, and while the central London office market saw 2.2m sq ft of development completions in the six months to September, there was just 42,000 sq ft in the West End. So, limited supply and low vacancy rates should provide underlying support.

A total of 37 new leases were secured in the six months, up from 21 a year earlier, with market lettings 2.4 per cent above March estimated rental value (ERV). The group's 21 rent reviews were settled on average at 42.9 per cent above the previous passing rent and 8.7 per cent above ERV. In all, this captured £3.1m of reversion, with a further £20.2m to be crystallised over the next 18 months.

Analysts at Peel Hunt are forecasting adjusted net asset value at the March 2018 year-end of 768.6p, down from 798.8p a year earlier.