Helical back to profit after ‘decisive action’ to cut costs

Helical has swung back into profit after taking “decisive action” to reduce overheads and closing £245m of sales, as the company announced its results for the year to 31 March. The REIT sought to cut costs by reducing its headcount and moving from its office at 5 Hanover Square, W1, to smaller offices in a less expensive location at 22 Ganton Street, W1, which it said would reduce costs by 25%. Throughout the year the company also recycled equity by selling assets totalling £245m. These included the £43.5m sale of 25 Charterhouse Square, EC1, to Ares Management, the sale of The Power House, W4, for £7m and the sale of the company’s half of Charterhouse Place, which owns The JJ Mack Building, EC1, to its JV partner AshbyCapital for £71.4m. However, the company’s outlook most notably improved after it announced the forward sale post-year-end of 100 New Bridge Street, EC4, for £333m, of which Helical’s share amounted to £166.5m after it sold a 50% stake to Orion Capital Managers. The value of the company’s portfolio increased on a like-for-like basis by 0.6% and the development portfolio value increased by 29.1%, providing a net increase of 5.8% overall. The company’s reported IFRS investment portfolio value came in at £373.3m, down from £472.5m following disposals throughout the year. As a result, it was back in black with IFRS profit of £27.9m, back up from a loss of £189.8m in 2024, and IFRS basic earnings per share of 22.8p, up from a loss of 154.6p. The company’s investment portfolio now consists of The Bower, EC1, and The Loom, E1. It continues to manage a multi-let campus at The Bower through lease breaks and expiries. Matthew Bonning-Snook, chief executive of Helical, said: “Going forward, the joint venture structure of our development activities will generate significant development management fees.” He added: “Alongside these, we will start to recognise promote fees as the developments progress and we will see the benefits of the decision taken to reduce administration overheads by 25%.” It has a pipeline of schemes in development, totalling more than 460,000 sq ft: 100 New Bridge Street; Brettenham House, WC2; and 10 King William Stret, EC4. All are due to complete in 2026. The REIT also has permission for a student accommodation and home development above Southwark Tube station, SE1, and a 19-storey building in Paddington which will deliver 235,000 sq ft of office space. The company is in talks for four deals with Transport for London’s property company Places for London, one of which is for an office scheme and the other three would be mixed-use in West London, Bonning-Snook added. Helical has formed a long-term partnership with PfL. Together they are delivering 10 King William Street, the 429 PBSA unit and 44 affordable home development in Southwark and the office development in Paddington. Bonning-Snook added TfL was very interested in forward-funding Helical’s Southwark student accommodation development, which would make PfL the ultimate owner. The company is also talking to other building owners in central London about other equity-light deals, Bonning-Snook said. Helical has strengthened its balance sheet recently to reduce its LTV to 20.9%, down from 39.5% in 2024 – its lowest historic level. 100 New Bridge Street image from Helical