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Investing.com -- Shaftesbury shares gained 3% following robust first-half results that showed strong leasing momentum and a positive portfolio revaluation in London’s West End.
The company completed 193 leasing deals representing £19.2 million in rent, achieving rates 9% above December 2024 estimated rental values (ERVs) and 16.3% above previous passing rents. The portfolio was revalued upward by 3.1% to £5.2 billion, with ERVs growing 2.9% on a like-for-like basis to £261 million - a figure 25% higher than current passing rents, indicating significant embedded growth potential.
Vacancy levels have trended downward to just 2.4%, below the company’s typical 3-5% range, giving Shaftesbury capacity to acquire new properties given its improved balance sheet position. The company reported that West End customer sales are approximately 30% ahead of 2019 levels, though retail ERVs remain 2% below pre-pandemic figures.
The first half of fiscal 2025 marked a transformative period for Shaftesbury following the sale of a 25% stake in its Covent Garden assets to NBIM for £570 million. The transaction, completed at book value, has significantly strengthened the company’s financial position, reducing loan-to-value ratio to 17% from 27% previously and improving net debt to EBITDA to 6.1x from 10.9x.
Operational improvements were also evident in the adjusted EPRA cost ratio, which decreased to 35% from 38% in June 2024. Net finance costs fell from £27.9 million to £23.7 million, supporting the company’s guidance for 5-7% rental growth.
CEO Ian Hawksworth expressed optimism about the company’s outlook, noting that Shaftesbury has "entered the second half of the year with positive momentum" and is "well positioned to grow the business and take advantage of market opportunities in London’s West End."
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