TIDMDLN
RNS Number : 2151R
Derwent London PLC
28 February 2023
28 February 2023
Derwent London plc ("Derwent London" / "the Group")
STRONG LEASING START TO 2023
Derwent London is pleased to announce that we have signed 10
leases since the start of 2023 for combined rent of GBP14.7m. This
includes the first pre-let at 25 Baker Street W1 and the third
major occupier for The Featherstone Building EC1.
The average lease term to break (WAULT) of these transactions is
13.4 years. On a proforma basis our operational EPRA vacancy rate
would reduce to 5.0%, from 6.4% at December 2022.
Transaction details
25 Baker Street W1
PIMCO, the global investment management company, has pre-let
106,100 sq ft on levels five to nine at our 25 Baker Street W1
on-site development (298,000 sq ft). The rent of GBP11.0m equates
to an average GBP103 psf. The lease is for a 15-year term without
breaks. The project does not complete until H1 2025.
The project's strong sustainability credentials played an
important role in PIMCO's decision. This includes being a net zero
carbon building, with a target of BREEAM Outstanding and our first
NABERS-rated building. PIMCO has an option to expand to include
level four (24,700 sq ft) which can be exercised up to 12 months
prior to practical completion. The commercial element of 25 Baker
Street is now 56% pre-let/sold, excluding the pre-completion
expansion option. The courtyard retail and Gloucester Place offices
have been pre-sold to the freeholder, The Portman Estate.
The Featherstone Building EC1
Buro Happold, the global engineering consultancy, has leased
31,100 sq ft on levels 5 to 8 at The Featherstone Building EC1. The
rent is GBP2.3m or GBP74 psf, in line with December 2022 ERV. The
lease is for 15 years with a break at year 10 (and a break at year
five on level eight).
Buro Happold is taking space in Old Street, recognising the role
this high-quality, net zero carbon space with our second occupier
amenity DL/28.Old Street, will have on its ability to retain and
attract talent. The location will also strengthen connectivity to
its design partners and supply chain. The building is now 59% let
by area, with only three floors remaining to be leased.
Paul Williams, Chief Executive of Derwent London, said:
"Over the last few months, there has been a marked increase in
confidence and occupier engagement with a busy start to the year.
We have agreed GBP14.7m of new rent from high quality occupiers,
which includes a substantial de-risking of 25 Baker Street two
years ahead of completion. These lettings demonstrate the
importance of well-designed space with strong amenity,
environmental credentials and connectivity. There is good further
occupier interest across our portfolio."
Justin Phillips, Partner and London Office Director of Buro
Happold, said:
"We are delighted to be taking space in The Featherstone
Building, a move that reaffirms our commitment to London. The
building strongly aligns with our environmental commitments and
provides a place to express our design and consulting capability.
With growth in mind, we will design the space for and with our
employees, to foster internal and external collaboration,
innovation and to be a creative and enjoyable space."
Key letting terms
Total annual Rent free
Property Tenant Area Rent rent Lease term Lease break equivalent
sq ft GBP psf GBPm Years Year Months
-------------- -------- -------- ----------------- ----------- ------------ -----------------
25 Baker Street
W1 PIMCO 106,100 103.40 11.0 15 - 37
The Featherstone 24, plus 12 if
Building EC1 Buro Happold 31,100 74.40 2.3 15 10(1) no break
Other 25,400 53.90 1.4 - -
-------- -------- ----------------- ----------- ------------ -----------------
2023 YTD 162,600 90.10 14.7 - -
-------- -------- ----------------- ----------- ------------ -----------------
(1) There is an additional break at year five on level eight
subject to a 12-month rent penalty payable by the tenant
For further information, please contact:
Derwent London Paul Williams, Chief Executive
Tel: +44 (0)20 7659 3000 Emily Prideaux, Executive Director
Robert Duncan, Head of Investor
Relations
Brunswick Group Nina Coad
Tel: +44 (0)20 7404 5959 Emily Trapnell
Notes to editors
Derwent London plc
Derwent London plc owns 70 buildings in a commercial real estate
portfolio predominantly in central London valued at GBP5.4 billion
as at 31 December 2022, making it the largest London-focused real
estate investment trust (REIT).
Our experienced team has a long track record of creating value
throughout the property cycle by regenerating our buildings via
development or refurbishment, effective asset management and
capital recycling.
We typically acquire central London properties off-market with
low capital values and modest rents in improving locations, most of
which are either in the West End or the Tech Belt. We capitalise on
the unique qualities of each of our properties - taking a fresh
approach to the regeneration of every building with a focus on
anticipating tenant requirements and an emphasis on design.
Reflecting and supporting our long-term success, the business
has a strong balance sheet with modest leverage, a robust income
stream and flexible financing.
As part of our commitment to lead the industry in mitigating
climate change, Derwent London has committed to becoming a net zero
carbon business by 2030, publishing its pathway to achieving this
goal in July 2020. In 2019 the Group became the first UK REIT to
sign a Revolving Credit Facility with a 'green' tranche. At the
same time, we also launched our Green Finance Framework and signed
the Better Buildings Partnership's climate change commitment. The
Group is a member of the 'RE100' which recognises Derwent London as
an influential company, committed to 100% renewable power by
purchasing renewable energy, a key step in becoming a net zero
carbon business. Derwent London has science-based carbon targets
validated by the Science Based Targets initiative (SBTi).
Landmark buildings in our 5.5 million sq ft portfolio include 1
Soho Place W1, 80 Charlotte Street W1, Brunel Building W2, White
Collar Factory EC1, Angel Building EC1, 1-2 Stephen Street W1,
Horseferry House SW1 and Tea Building E1.
In January 2022 we were proud to announce that we had achieved
the National Equality Standard - the UK's highest benchmark for
equality, diversity and inclusion. In October 2022, 80 Charlotte
Street won the BCO's Best National Commercial Workplace award 2022.
In October 2021, the Group won EG's UK Company of the Year award
and in January 2022 came top of the Property Sector and 38th
position overall in Management Today's Britain's Most Admired
Companies awards 2021. In 2013 the Company launched a voluntary
Community Fund which has to date supported over 150 community
projects in the West End and the Tech Belt.
The Company is a public limited company, which is listed on the
London Stock Exchange and incorporated and domiciled in the UK. The
address of its registered office is 25 Savile Row, London, W1S
2ER.
For further information see www.derwentlondon.com or follow us
on Twitter at @derwentlondon
Forward-looking statements
This document contains certain forward-looking statements about
the future outlook of Derwent London. By their nature, any
statements about future outlook involve risk and uncertainty
because they relate to events and depend on circumstances that may
or may not occur in the future. Actual results, performance or
outcomes may differ materially from any results, performance or
outcomes expressed or implied by such forward-looking
statements.
No representation or warranty is given in relation to any
forward-looking statements made by Derwent London, including as to
their completeness or accuracy. Derwent London does not undertake
to update any forward-looking statements whether as a result of new
information, future events or otherwise. Nothing in this
announcement should be construed as a profit forecast.
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