Great Portland Estates sees strong leasing demand in fourth quarter

(Sharecast News) - Great Portland Estates has hailed a strong end to its financial year, with leases around 10% above estimates in the fourth quarter, as the London-based real estate group saw solid demand for its fully managed properties.

Some 32 new leases and renewals were signed during the three months to 31 March in what GPE called "one of our busiest quarters on record". These new deals generated annual rent of �18.2m with market lettings on average 9.9% ahead of the estimated rental value (ERV) at the start of the financial year.

For the full year, 74 new leases and renewals were signed, generating �37.7m in annual rent at 10.6% above ERV, 41 of which were fully managed.

Net operating income (NOI) for GPE's fully managed sites totalled �16m, up 60% since its interim results were released.

"At the outset of the financial year, we set ourselves ambitious targets for creating and leasing new fully managed spaces. As the year comes to a close, the GPE team has delivered on this ambition with our NOI up 60% since November," said chief executive Toby Courtauld.

Courtauld said that good progress across GPE's development pipeline and strong demand means it is "well positioned to take full advantage of favourable leasing markets".

He added: "Despite the volatile macro-economic backdrop, a supportive surplus of demand over supply in our local markets gives us confidence in our positive rental growth and TAR [total accounting return] outlook."