Commercial landlord Helical (HLCL) has been severely punished by the market over fears of a spike in tenants defaulting on their rent and an increase in vacancy levels. The shares are trading at a sizeable discount, not only to historic and forecast net asset value (NAV) – 39 per cent and 44 per cent, respectively – but also to peers. The extent to which the shares have been marked down seems unjustified, given the prime location of the group’s London and Manchester portfolio, the strength of the balance sheet and its lower level of development commitments.
Shares trade at steep discount to NAV
Reduced committed capex
Low retail and leisure exposure
Shortfall in rental collection
Slower lettings progress