- ‘Sustained recovery’ in trading and sentiment
- Footfall above 2019 in Soho and Chinatown
- Share price still at 2006 level
London-focused property investment trust Shaftesbury (SHB) posted a 28% increase in net property income for the year to September, saying it had seen a ‘rapid rebound’ in trading and footfall across its estate.
Shares in the company, which have lost more than 40% this year, firmed 1% to 362p.
BUSINESS IS BACK TO NORMAL
According to chief executive Brian Bickell, ‘patterns of everyday activity returned to pre-pandemic normality’ across the West End as the recovery in footfall and trading since the start of 2022 ‘has been matched by the strength of occupier demand in our carefully curated and popular locations’.
Shaftesbury owns 16 acres of West End real estate, comprising 600 shops in iconic locations such as Carnaby Street, Chinatown, Covent Garden and Seven Dials, as well as properties in Fitzrovia and Soho.
The firm reported a ‘sustained recovery in confidence and activity driving growing footfall ahead of 2019 levels’, with hospitality and leisure as well as retail occupiers reporting average monthly sales 6% ahead of pre-pandemic levels.
Also, the opening of the central section of the Elizabeth Line in May has resulted in ‘a noticeable increase’ in footfall on streets close to the extended and improved Tottenham Court Road station.
Rent collection is back to its pre-pandemic level of 99%, and cash flow generated from operations jumped 61% to £61.8 million as Covid-driven rent support dried up and occupancy levels recovered.
Meanwhile, the merger with Capco (Capital & Counties) has been approved by shareholders of both firms and should become effective during the first quarter of 2023 subject to discussions with the Competitions and Markets Authority.
BIG DISCOUNT TO NET ASSET VALUE
Net asset value per share increased 3.6% on last year to 641p, putting the shares - which are trading at the same level as they did in 2006 - on a discount of over 40% to the value of the portfolio.
Worries over Covid, the impact of working from home and the surge in online shopping have put investors off owning property stocks, especially those with hospitality and retail exposure.
Also, rising interest rates push up the cost of debt and push up yields on property companies, meaning shares and asset prices fall.
LEARN MORE ABOUT SHAFTESBURY
