There appears to be nothing to halt the upward trend in the property sector, not even concern over off-balance-sheet gearing is likely to pull share prices down. The worries being expressed in some quarters over the so-called non-recourse loans should be taken seriously. It is inconceivable that companies would be able to walk away from these loans and shareholders should begin to question their directors over the effect on the company on these loans if they were ever called.
On September 17, the sector’s leaders were mixed. Great Portland gave up 2p to 327p and MEPC came back 6p to 560p, but Slough Estates firmed 2p to 289p. London & Edinburgh Trust advanced 9p to 199p and Wates City of London added 4p to 270p. Elsewhere, Baker Harris Saunders rose 5p, ahead of the announcement on the purchase of Bailey Posner, to close at 365p and Arlington added 3p to 273p on investor demand.
Among second liners, Ewart New Northern soared 40p to 225p on speculation that it was to be taken over. Hardanger gained 15p to 940p and small investor buying sent Helical Bar to a new peak with a 13p gain to 295p. Regalian slipped 4p to 280p and diminishing bid hopes clipped 23p from Alfred Walker to 375p.
The leaders advanced again on Friday September 18, with Land Securities 5p up at 605p and MEPC also 5p better at 565p. Capital & Counties gained 15p to 425p and Imry International rose 8p to 538p.
Property Security Investment Trust was a strong feature, gaining 9p to 209p on institutional investor demand. Warner Estate gained 1/8 to £12 7/8, reflecting the continuing strength of the residential property market. But Tops Estates hit some profit-taking, falling 10p to 355p. Helical Bar gained a further 27p to a new peak of 322p. The Bailey Posner deal was announced at Baker Harris Saunders’ first annual meeting and the shares put on 15p to 380p. Asda was a strong market, closing 13p better at 733p.
On Monday the leaders were once again mixed: MEPC and Land Securities each gained 4p to 569p and 609p respectively, but Hammerson eased 5p to 680p. Clayform gained 10p, ahead of its interim results, to 373p and Bilton added 5p to 398p. Fletcher King gained 3p to 251p. However, Hardanger fell 20p on profit-taking to 940p and Helical Bar slipped back 10p to 312p. Westminster & City fell 10p to 250p in a thin market in its shares.
Southend Stadium slipped 6p to 216p, but Speyhawk gained 3p to 543p. Trust of Property added 5p to 250p and Marler rose 1/2 to £13 1/4 on bid speculation. Mountleigh, reflecting its activities in Storehouse, eased 3p to 279p, while Imry International gained 2p to 540p.
Problems in the Gulf sent the whole equity market sliding on Tuesday with the banking sector the only firm spot. Leading properties all fell back in nervous dealing. Hammerson fell 10p to 670p and Land Securities eased 2p to 607p, while MEPC added 4p to 565p and Great Portland eased 2p to 321p. Against the trend, however, Slough Estates firmed 3p to 301p.
Baker Harris was another victim, falling 5p to 380p, while Capital & Counties lost 15p to 415p. Clayform’s interim results failed to please the market and the shares fell 10p to 363p. Connells lost 5p to 475p, but Bilton firmed 2p to 400p. Hardanger lost 20p to 920p, but Helical Bar gained 15p to 327p, although the thin market in its shares means that even a small buying order sends the shares up.
A firm market reflected on the sector on Wednesday. New England fell 4p to 59p after news of the share issue to fund a portfolio purchase from Frogmore, the latter closing 5p higher at 330p. Citygrove lost 15p to 285p, but speculation lifted Asda 14p to 747p.
