London-focused flexible office and warehousing provider Workspace (WKP) rises 2% to 835p on rents in the nine months to 31 December improving 16.4% to £11.4 million.
The 2.3% rental gain recorded in the third quarter (1 Oct to 31 Dec) alone was the result of price rises rather than just winning new customers as occupancy was flat on the previous quarter at 91.2%.
Workspace saw its rent grow 1.9% to £20.58 per square foot thanks to three newly-refurbished properties opening for business during the quarter.
The group continues to cite strong demand for newly completed space and growth at its business centres at 12.3% in the nine month period.
The pipeline remains strong with Workspace securing consent to build 200 homes and a 34,000 square foot business centre on this half acre site in Stratford, near the Olympic Stadium.
Sue Munden at Panmure Gordon believes it will sell the site to a developer in a deal that will see the business centre returned to Workspace on completion.
Following the update Liberum’s analysts remain upbeat. ‘Demand at newly completed space is strong and lettings evidence would suggest Workspace’s budgeting assumptions remain overly cautious.
‘We make no change to our forecasts, which factor 60% NAV growth in the three years to March 18E, the highest in the UK real estate sector.’
