St Modwen has boosted its logistics holdings and repositioned away from central London and retail following the sale of its New Covent Garden Market site, SW8, last year.
Last summer the company sold the luxury residential site for £470m to Wanda, which was subsequently forced to flip it on to CC Land and R&F Properties after the Chinese government put pressure on Wanda because of the scale of its non-domestic activities.
Since then, under the stewardship of chief executive Mark Allan, St Modwen has been focused on regional development. Its annual results for the year to 31 May show a logistics pipeline of 1.3m sq ft, an increase from 1m sq ft for the previous year.
St Modwen has sold £350m of assets since the start of the year and £635m since it announced its new strategy last June.
The company said the sales, which represented 35% of its portfolio a year ago, have “driven a clear improvement in our portfolio mix and, having reduced our exposure to more challenging sectors such as London residential land and UK retail by more than £300m, materially improve our total return prospects”.
The company’s NAV crept up by 1% over the past six months to 455.4p per share and its portfolio value rose by 1.5% to £1.5bn.
Allan said: “We have had a good start to 2018. Our expectations for the full year remain unchanged and we are focused on executing the new strategy we established a year ago.
“We have sold £635m of assets since then, improving our portfolio mix and allowing us to reduce borrowings, while accelerating the delivery of our substantial industrial/logistics and regional housebuilding pipeline.
“Despite ongoing uncertainty in the external environment, structural growth drivers in both sectors remain positive, so we anticipate delivering a meaningful improvement in earnings and return on capital in the medium term.”
To send feedback, e-mail david.hatcher@egi.co.uk or tweet @hatcherdavid or @estatesgazette
