Workspace confident as demand lifts rents

Demand for flex office space has helped Workspace Group boost rents across the business. The group said that its total rent roll had increased by 2.1% in the three months ended 31 March to £143.4m. Like-for-like rent roll was up by 1.9% in the quarter and 9.6% since 31 March 2023 to £111.2m. Like-for-like rent per sq ft increased by 1.9% in the quarter and 10.4% since 31 March 2023 to £44.27 per sq ft. Workspace completed a total of 343 new lettings during the quarter, adding £8.7m of rent per annum. Over the year as a whole, the group has completed 1,238 lettings, boosting its rent roll by £31.3m. Like-for-like occupancy remained broadly stable at 88.1%. Since 31 December 2023, Workspace has exchanged on the sale of five non-core properties for a total of £41m at a net initial yield of 6% and 3% below their September 2023 valuations. The sales include an industrial estate in Poplar, sold for £21.5m in January, an industrial estate in Banbury, sold for £3.8m in February, a residential development opportunity at Chocolate Factory in Wood Green, sold for £7.3m, also in February, a small office property in Staines, sold for £4.3m last month and the former McKay head office, 20-30 Greyfriars in Reading, sold for £4m earlier this month. Chief executive Graham Clemett said: “We have had another year of strong trading, with continued demand for our offer delivering double digit rent roll and pricing growth in the year.” He added: “We have made additional progress on disposals, recycling capital efficiently to invest in our value-enhancing programme of refurbishment projects across the portfolio, while further strengthening our balance sheet.”