Office space specialist CLS has stayed steady despite Covid “headwinds”.
Announcing its annual results this morning, the landlord said its portfolio had risen in value to £2.3bn, from 2020’s £2.2bn, as a result of £142m of net acquisitions and valuation increases.
CLS, which converted to a REIT in the UK in January, has around 50% of its properties in the UK, with 38% in Germany and the remaining 12% in France.
CLS said it would continue to dispose of smaller properties across the portfolio, with a goal of reducing management costs, and would increase its spend on refurbishments, redevelopments and new builds. While capital expenditure was £36m in 2021, CLS said it expected to spend between £50m and £70m in both 2022 and 2023.
It hopes that this will allow it to increase ERV from £108m to £138m by 2023.
Profit from recurring operations was £77.3m, down from 2020’s £77.4m, while the £28.4m from revaluation gains and the sale of investment properties in 2021 was significantly lower than 2020’s £43.1m.
EPRA earnings were impacted by negative exchange rate movements and student and hotel occupancy, with earnings per share down at 11.3p against 2020’s 12.2p.
CEO Fredrik Widlund said: “CLS has delivered a healthy and robust set of results for 2021, with net assets up from earnings and valuation gains in all of our three countries. We faced headwinds from the strengthening of sterling and the impact of pandemic restrictions, which temporarily reduced occupancy, but our operational performance, especially in the second half of the year, was excellent with collection and leasing activities at pre-pandemic levels.”
He added: “We have seen significant positive momentum in lettings in recent months and have more than 30 ongoing refurbishment and developments that will drive strong growth going forwards.”
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