Last updated February 9th 2022
Great Portland Estates plc
Great Portland Estates is a central London property investment and development company with a portfolio worth £2.5 billion and with 2.6 million sq ft of space much of which is in the West End, north of Oxford St. Its strategy is to deliver superior returns by unlocking what it says is the often-hidden potential in retail and office property in central London.
Despite the sector’s current mixed trading conditions, GPE has a significant development programme with a total of nine schemes in the pipeline, set to produce 1.4 million sq ft of space and including four near-term schemes and a £900 million near-term development programme.
Great Portland takes a customer-focused approach to managing its properties and sets great store by its successful reading of the property cycle. The group’s business model involves investing in desirable and liquid locations in central London with low rents per sq ft and which offer potential, often through refurbishment and development. The process is overseen by the group’s in-house teams focusing on asset, investment and development management. The group typically rotates 10-20% of its portfolio each year and today ‘flexible’ space accounts for around 15% of its portfolio and is an area targeted for growth.
The group appears to be rebounding as the capital’s property market recovers from the impact of Covid.In February 2022 chief executive Toby Courtauld reported a record level of leasings at the group. He said: ”Absent a resurgence of the pandemic, our confidence is building for the remainder of 2022, as we expect the combination of economic growth, a return to normal trading conditions and central London’s magnetic appeal to be positive for our markets.”
Financials
To view the financials for Great Portland Estates plc, visit Companies House and use Company ID 00596137.
Great Portland Estates had an easier time in 2021 as the capital’s office and retail markets began to stabilise. The group’s portfolio valuation rose 2% in the half to end-September 2021 to £2.5 billion (+2.4% for offices and -0.8% for retail) and its developments’ value was up 29.7% whilst its 12 month total property return stood at +3.7%. Underlying (epra) earnings fell by 9.2% to £18.7 million and the group reported a pre-tax profit of £62.3 million, compared to a loss of £154.8 million previously. However the group has a strong financial position with cash and undrawn facilities of £486 million and net debt of £438.6 million. In the year to end-March 2021, the group reported pre-tax loss of £202 million.
Developments
The development programme remains a significant share of Gt Portland’s business; In all the group has four schemes in the medium-term pipeline, a total development programme of 1.4 million sq ft and which covers 32% of GPE’s existing portfolio. The group is also working on a substantial development pipeline schemes to deliver from the mid-2020s.
At 2 Aldermanbury Square, EC2 the group has appointed a contractor and work is starting early in 2022 on a scheme to substantially increase the building’s size to 319,800 sq ft (up from 176,000 sq ft) and with various public realm improvements as nearby Liverpool Street Crossrail station opens. Occupier interest in the scheme has been strong.
At French Railways House and 50 Jermyn Street, SW1, part of Gt. Portland’s Piccadilly Estate, the group is proposing a major office-led redevelopment providing 67,700 sq ft of new Grade A space on a development which is subject to Crown consent.
Meanwhile a planning determination is expected later this year at New City Court, SE1, where the group has amended its proposals on a scheme to expand the 98,000 sq ft building to 389,100 sq ft. Elsewhere at Minerva House, SE1, GPE is finalising plans for a 139,400 sq ft major office refurbishment.
Completion of the group’s development at 50 Finsbury Square, EC2, a refurbishment of a129,200 sq ft building, including a new roof pavilion, is expected in late 2022.
Glenigan data
Figures from Glenigan highlight the significance of some of the schemes where Great Portland Estates is involved. They show that the group is the client on a £23.5 million scheme of office and retail units at 48 Jermyn St in the West End, which is at the pre-tender stage and where work is set to start in autumn 2022 (Project ID: 20399112). GPE is also the client on Minerva House, a commercial development in Southwark which is at the pre-tender stage and where work is set to start in late summer 2022 (Project ID: 21573497).
Conclusion: Strong portfolio with healthy development pipeline
Take up of space in the central London office has rebounded sharply as the pandemic has receeded and GPE’s continued faith in the capital’s commercial property market is reflected in its significant development programme. Rather than making acquisitions, the group is focused on exploiting its existing development pipeline of 1.4 million sq ft of space and it is looking at further schemes to take it through to the middle of the decade. Over coming years, the group should benefit as Crossrail opens and major schemes such as New City Court take shape. In a challenging market, the group is likely to remain a significant force on the capital’s property development scene.
How to win work with Great Portland Estates
Great Portland manages all aspects of its property portfolio in-house with the group’s asset and leasing managers working closely with tenants and its own development team. The group sets great store on matching its development activity to the right points in the cycle and on being flexible on its start and completion dates for schemes.
Great Portland regularly updates its portfolio and the group’s development team manages the process, from small scale building refurbishments to large scale redevelopments. The group’s in-house development managers work up the designs and negotiate with planners on all its schemes. Meanwhile, an in-house building management team provides support for tenants.
Contacts:
Andrew White, Development Director
Tel : 0207 647 3000
Email andrew.white@gpe.co.uk
James Pellatt, Director of Workplace and Innovation
Tel: 020 7647 3000
Emal: james.pellatt@gpe.co.uk