Wichford, which specialises in buying offices outside London let to government tenants, is struggling to spend money.
Announcing a 13.3% rise in fully diluted net assets in the six months to 31 March, to 195p per share, chairman Michael Sheehan said the AIM-listed company had “acquired fewer properties over the period than previously anticipated and it seems likely this trend will continue”.
Sheehan said that intense competition for institutional property, plus the failure of the Lyons review to result in government employees moving out of London in the significant numbers that had been predicted, had made buying in the regions difficult.
As a result, the company is still sitting on a £45m cash pile, and may not spend the £200m it had anticipated during this full financial year.
In consequence, it has decided to include central London for the first time in its hunt for investments.
Wichford did manage to spend £127m on 13 properties, with an average blended yield of 6.7%, including the 77,000 sq ft Castle House in Leeds, which is let for 18 years to the Inland Revenue.
The whole portfolio rose in value to £417m, producing £25m pa in rent.
