Shaftesbury hails West End Recovery: Landlords swing back into profit as shoppers splash cash and tourists return
The owner of vast swathes of London’s West End has swung back into profit as shoppers splashed the cash and tourists returned to the capital.
Shaftesbury, a FTSE 250 landlord that owns areas including Chinatown, Carnaby Street and parts of Fitzrovia near Oxford Street, posted a profit of £119million for the year to the end of September compared to a £195million loss in 2021.
Tenants include restaurants, pubs, and retailers. Rent collection was back at pre-pandemic levels. Many reported monthly sales that were around 6 percent higher than in 2019.
Sales up: Shaftesbury, which owns areas including Chinatown, Carnaby Street and parts of Fitzrovia near Oxford Street, posted a profit of £119m for the year to the end of September
With rising demand for premium retail space and commercial space, vacancy rates have also returned to pre–Covid levels.
‘The year has seen a rapid rebound in the West End economy as Covid-related disruption receded and patterns of everyday activity returned to pre-pandemic normality,’ said chief executive Brian Bickell.
He added that while the firm’s properties ‘cannot be immune’ from challenges across the wider economy, long-term prospects were ‘bright’.
Due to the strong recovery, the firm was able to increase its dividend by almost 55 percent to 9.9p per Share.
Shares In the company, it rose 1.5 percent, or 5.2p., to 364.2p.
One problem was the 16-acre portfolio of properties, which saw a decrease of 3.6% between March and September due to rising interest rates and a worsening outlook for global economic conditions.
Despite this, the group’s portfolio was still valued at £3.2billion at the end of September, up 3.6 per cent on a year earlier.
Shaftesbury, a commercial landlord, has also benefited from recent weakness of the pound. This has made the UK a desirable destination for US tourists looking to stretch their dollars further.
Shaftesbury’s return to profit comes as it prepares to merge with rival Capco, which also has a portfolio of prime London sites, including Covent Garden market.
The £5billion combination of the two, expected to complete early next year, will unite some of the most valuable areas of the West End in a 2.9m square foot empire comprising shops, restaurants, offices and housing.
Bickell is expected not to resign after the merger. Capco’s chief executive Ian Hawksworth will be leading the firm.
Although the merger was approved by both shareholders, competition regulators are currently looking into it.
All interested parties are required to make comments by Friday on any possible merger.