UPDATE: Land Securities said it expects to spend “low single digit millions” to fix the solar glare issue at 20 Fenchurch Street, EC3.
In its interim results the REIT said a solution to fix the phenomenon of scorching rays reflected from the building over the summer “is in the final stages of design and implementation will commence shortly”.
The company’s chief financial officer, Martin Greenslade, said that the expenditure in “the low single digit millions” will not add to the developer’s £239m share of the City tower’s overall development costs.
The 37-storey scheme, which it developed in a joint venture with Canary Wharf Group, is now 56% prelet, with a further 20% in solicitor’s hands.
Greenslade added that a decision will be made about a speculative start on 1 New Street Square, where demolition work is currently being undertaken, early in the new year.
Speaking about the company’s results for the six months to the end of September, he said the company “was in delivery mode doing what we set out to do in 2010 as an early cycle developer”.
The REIT posted a 3.8% rise in net asset value to 937p a share, and an 8.9% hike in revenue profit to £156.5m, although it warned revenue profit was likely to be squeezed in the second half.
Net debt ticked up by £86.7m to £3,785.3m, but Greenslade said this will be reduced by £409m because of two significant disposals at Bankside, SE1 and Aberdeen since the period end.
Despite the increase in debt compared with last year, the group’s loan to value remained broadly stable, up from 36.9% in March to 37% at 30 September, and LandSec’s “strategy at this stage in the property cycle of allowing gearing to decline as property values rise remains unchanged.”
The group’s combined portfolio was valued at £11.76bn, with a valuation surplus of 1.9% in the period, with Greenslade adding “there is plenty more to come”.
