Derwent may delay development of the Brunel Building in Paddington, W2, if the market “pushes back”.
Chief executive John Burns said his firm was cautious because there was no way to know what the impact of Brexit would be on activity for the rest of the year.
He said: “We’re being realistic. We’re optimistic in the fact that our lettings are good, but we’re being realistic in saying, ‘Look, this is it, but there are other circumstances that could impact people.’ Decision-making could take longer.”
Burns was speaking after this morning’s half-year results in which the company posted a 14.9% increase in pretax profit.
Burns said that the Brunel Building, Derwent’s 240,000 sq ft office development that began construction at 55-65 North Wharf Road earlier this year, and is due to complete in the first half of 2019, might be delayed later this year.
He said: “We have a scheme in Paddington where we’ve demolished and we’re starting to put the base in. The intention at the moment is to go ahead. If we felt the market is having a push-back, we could consider delaying that.”
He added that despite the caution, activity had not fallen since the referendum.
A further 122,000 sq ft of space has been let since 30 June.
Finance director Damian Wisniewski said: “The deals are still coming in thick and fast.”
Reacting to the interest base rate cut to 0.25% last week, Burns said: “The returns you can get from property investment are better than those you can get from nine out of 10 other investments, and you’ve got something tangible: bricks and mortar.”
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