Derwent London has said that it is finding it difficult to find purchasing opportunities in the London office market, following a trading update issued today.
Announcing record new lettings of £41m so far in 2017, chief executive John Burns said the company would like to be a net buyer but “we are not finding opportunities at the moment”.
He said that although there is a lot of investment stock available in the City, the company would not touch the Square Mile, preferring to stick to its strategy of redeveloping offices in the West End and City fringe.
In 2017 to date the company has let or prelet 674,800 sq ft of space, already achieving a record £41.2m pa of rent on new deals.
The REIT’s gearing levels are also dropping: cash and undrawn facilities were £422m by the end of Q2 and the LTV was 15.3%; this will drop to 12.7% following transactions in September.
Second-half transactions included a prelet to Boston Consulting Group and Arup committing to further space at 80 Charlotte Street, W1.
The company’s next major project, 1 Soho Place, W1, will commence this time next year, following the completion of Tottenham Court Road Crossrail station.
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