Grosvenor has reported a 16% fall in profit before tax in its latest financial results for 2018.
Profit before tax for 2018 stood at £196.6m, down from £233.1m the year before.
Its revenue profit also dipped to £131m from £143.5m, but marked the third-highest revenue profit recorded since 2009.
Grosvenor chief executive Mark Preston said the company’s 2018 financial performance was “better than we had expected”.
He said this was largely due to the group’s international diversification strategy, with half of the company’s property assets now held overseas.
The partial sale of the company’s 20% interest in Sonae Sierra as well as long-term bond issuance has boosted its financial capability from £1.4bn to £1.7bn, which will be used to fund its £4bn pipeline.
Preston added: “Looking ahead, after a remarkable near 10-year run of strong property returns, global markets have reached a mature stage in the cycle. As a result, we will have to work harder and cleverer to deliver returns anywhere near those we have seen in recent years.
“As a long-term investor with diversification as a key objective, we will continue to invest in those cities we believe will outperform financially and where we are already engaged and have an understanding of local communities.”
Preston also spoke to EG about Grosvenor’s £500m build-to-rent scheme in Bermondsey, SE16, which was refused planning consent in February this year by Southwark Council.
The Grosvenor boss said all options are being looked at for the future of the site but slammed the council’s decision to give the scheme the red light.
“While we’re looking at all our options on site, we still absolutely believe in the case we were making, and frankly we would continue to make, not just for Southwark but more broadly in London,” Preston said.
“We were planning to deliver rental homes for key workers who can’t afford to buy their own houses but don’t qualify for social housing. This is an area of desperate need,” he added.
“We are therefore very disappointed we may not be able to deliver it.”
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