Don’t follow executive director Neil Thompson who has reduced his investment in Great Portland Estate (GPOR) which owns £2.8 billion of assets in London’s West End. Although the commercial property investor and developer is trading at an 11.1% premium to its net asset value (NAV) on the back of very strong growth, it remains attractive with a significant development pipeline in a very strong central London market.
Thompson sold 115,000 shares at 655.49p in a transaction worth £753,814. He is still left with 652,582 shares worth £4.3 million at the 659p price at the time of writing.
Great Portland’s NAV grew by 28% in its financial year ending 31 March, helped by its 411,800 square foot development at Rathbone Square in London receiving planning consent to become 142 private residential units. It sold £422 million of assets in the year versus only £90 million of acquisitions. It expects future acquisitions to be selective with the primary focus on executing its asset management and development plans.
Great Portland’s EPRA net asset value was 593p at the end of June, a rise of 27.8% in 12 months. Oriel reckons it will have 614p NAV by the half-year point in September. The dividend isn’t overly generous with a prospective 1.3% yield, yet investors should also take into account capital appreciation that’s likely to be on offer as the value of its property assets continues to rise.
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Great Portland is a premium-quality play on the vibrant central London property market. We share the bullish consensus view.
THE TRADE
Buyer: Neil Thompson, executive director
Consideration: £753,814
No. of shares sold: 115,000
Subsequent holding: 652,582 (0.19)