Derwent London PLC on Thursday reported an increase in leasing activity, fuelled by strong demand for its central London properties.

The London-based property investor and developer reported strong leasing results in its third-quarter update, with year-to-date lettings reaching £13.3 million, 8.5% above estimated rental value.

In the second half of 2024, the trust has signed £4.5 million in new rent at 9.8% above estimated rental value, reflecting demand across London villages.

Derwent said demand remains strong, with £5.7 million in rent currently under offer, while its EPRA vacancy rate, which measures the percentage of its properties currently unoccupied and available for lease, has decreased to 3.0%.

Derwent’s net debt rose to £1.39 billion at the end of September, up from £1.37 billion in June. This increase was largely driven by £145 million project expenditure of £145m offset by retained cash from operations.

Derwent’s interest cover ratio, a measure of its ability to cover interest payments, was unchanged at 4.0 times for the nine months up to September. By the end of the quarter, cash and available credit totalled £547 million.

Chief Executive Officer Paul Williams said: ‘With strong occupier demand for high quality buildings in the right locations, we are seeing rental growth across our London villages which supports our upgraded estimated rental value guidance announced in August.’ The announced upgrade had set estimated rental value growth expectations to a 3% to 6% range.

Derwent’s share price closed up 3.5% at 2,138.00 pence in London on Thursday.

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