West End landlord Shaftesbury (SHB) saw higher visitor numbers in the six months to 22 September 2017, with a notable rise in overseas visitors. The company operates a portfolio of restaurants, offices, coffee houses and pubs across 14.5 acres concentrated in Carnaby Street, Covent Garden and Chinatown, and demand for smaller space remained strong while vacancy levels were low.
However, recent political and economic uncertainties are showing signs of slowing occupiers’ decision making on larger spaces, where tenants have to make a significant commitment to fitting out premises. Some of this delay in letting larger premises may also reflect Shaftesbury’s policy of being selective in choosing occupiers that fit in with the existing estate.
Finances have also been shaken up, with the remaining £125m of legacy interest rate swaps being cancelled at a cost of £57.9m, which will shave 21p a share off adjusted net asset value per share. Proceeds from a £290m mortgage bond have been used to repay bank debt, reducing the blended cost of debt from 3.7 per cent to 3.3 per cent. Should the remaining facilities of £305m be fully drawn, the cost of debt would fall to 2.8 per cent.
