Firm behind White Rose and Trinity centres says rents rising at ‘fastest pace’ in 20 years
The firm behind the White Rose and Trinity shopping centres in Leeds said it had seen rent prices grow at the fastest pace in almost two decades, as the company posted a lift in earnings.
Commercial property firm Landsec saw its ERPA earnings – the income return generated by the company’s investments – land at £382m for the year ending 31 March, up from £374m a year prior.
The company’s earnings per share (EPS) also lifted 2.2 per cent, landing towards the top end of guidance at 51.4p.
The figures came as Landsec said it has seen occupancy across its group grow to its highest levels in 20 years.
In a statement issued alongside the company’s results, Mark Allan, chief executive of Landsec, said: “Occupancy is now up to a 20-year high and rents are growing at their fastest pace in nearly two decades.”
According to a rental forecast by Alan Boswell Group, the average cost of commercial property in England is set to rise just over 19 per cent between 2024 and 2034.
The forecast states that by 2034, the average cost of commercial property in England and Wales is expected to be £112 per square foot, up from £94 per square foot in 2024.
Landsec announced that net rental incomes in its retail segment had lifted 5.5 per cent for the year ending March 31, with rental income for its offices arm also rising six per cent.
Landsec’s property portfolio includes a string of retail and office sites across the UK, as well as a number of regeneration projects.
The company is the owner and manager of the White Rose Shopping Centre, in Beeston, and Leeds city centre’s Trinity centre.
It is also the owner of the Cardigan Fields Leisure Park, in Leeds.
The results come as the company forges forward with two major residential schemes located in London and Manchester.
The firm said that three quarters of its 9,000-home pipeline now has consent after it received planning permission for the first 879 homes at a scheme in Mayfield, Manchester, and for 2,800 homes in Lewisham, London.
The firm is also working towards building 2,700 homes at MediaCity, in Salford, and 1,800 homes in North London.
Speaking on the firm’s plans, Mr Allan said: “Over the past few years we have actively positioned Landsec for a higher inflation and higher interest rate world.
“We have focused our portfolio on the best quality locations where customer demand is highest, scaled back development, reduced our overhead costs and maintained our strong capital base.”
Mr Allan said that the company remains “confident” in its potential growth in its EPS between now and 2030 despite “elevated geopolitical risks”.
He added: “As a result of our actions, our strong top line growth will increasingly flow through to an acceleration in EPS growth in the near and medium term.