The Vickers Commission recommendations will lead to banks based in London being more secure than elsewhere, and will attract additional business, Canary Wharf Group said this week as it posted a 3.8% increase in net asset value per share for the first half of the year.
Chairman and chief executive George Iacobescu said: “Despite the difficult financial conditions, the attractions of London as a base for financial business will continue to increase. The implications of the Vickers Commission recommendations, including the flexibility of the ringfence structure, have largely been welcomed by the financial community as a step towards greater clarity, which banks need to be able to operate with confidence.”
The group’s NAV per share rose 15p to £4.05 for the six months to the end of June on the back of a 4.8% increase in the value of its net assets to £2.5bn. Retained profit was £19.9m, compared with a loss for the comparative period of £75.2m.
The market value of Canary Wharf’s investment portfolio increased £95.4m (1.9%) to £4.7bn in the first six months of this year, driven primarily by hardening rental yields.
Voids on the Docklands estate are low. The investment portfolio was 97% let at 30 June and leases on 80% of the space by sq ft does not expire or cannot be terminated by tenants in the next 10 years.
During the period, 250,000 sq ft of the 500,000 sq ft 25 Churchill Place development was prelet to the EU’s European Medicines Agency, driving up the value of the group’s development sites by 3.3%, to £280m.
Canary Wharf has continued to step up its central London exposure outside the estate, bidding successfully with Qatari Diar for the Shell Centre redevelopment on London’s South Bank.
Construction on the 690,000 sq ft Walkie Talkie tower at 20 Fenchurch Street, EC3, a joint venture with Land Securities, is on track to be completed in April 2014.
Songbird Estates, which owns two-thirds of CWG, reported a 3.7% increase in NAV to 194p a share in its interim results, also published this week.
