Great Portland Estates plans GBP350 million raise to buy properties

(Alliance News) - Great Portland Estates PLC on Thursday said it will raise GBP350 million from ...

Alliance News 23 May, 2024 | 10:52AM
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(Alliance News) - Great Portland Estates PLC on Thursday said it will raise GBP350 million from the rights issue of new shares, after sighting opportunity in London to make further acquisitions and announcing one that it just made.

The London-based office building developer said its pretax loss widened in the financial year that ended March 31 to GBP307.8 million from GBP164.0 million the year before.

Revenue rose 4.6% to GBP95.4 million from GBP91.2 million, but Great Portland took a bigger loss on valuation of investment properties of GBP267.3 million, compared to GBP145.0 million last year.

Great Portland maintained its final dividend at 7.90 pence per share, bringing the total dividend to 12.60p, also consistent with the previous year.

Chief Executive Toby Courtauld said: "We remain strong believers in London's long-term prospects; whilst its occupational markets, particularly for centrally located, Grade A space continue to power ahead with growing demand and shrinking supply."

In the recent financial year, Great Portland acquired three properties off-market for GBP112.9 million as it continues to expand its portfolio.

On Thursday, Great Portland revealed it exchanged contracts to acquire the long leasehold interest of The Courtyard WC1 in London. The office and retail space will be acquired for GBP28.6 million, alongside a property swap of another London asset worth GBP18.2 million.

Investment Manager James Harrop-Griffiths commented: "This transaction represents a unique opportunity to recycle capital from a low-yielding retail asset into a fantastic office development opportunity."

To do more of the same, Great Portland launched a three-for-five rights issue to raise approximately GBP350 million through the issue of 152 million new shares at 230.00p each.

Great Portland Shares were down 1.4% to 416.55 pence each in London on Thursday morning.

Management said this will allow the company to take advantage of further acquisition and development opportunities across London at a time in which higher interest rates have pushed valuations down in line with levels last seen in 2009 in real terms.

The company is currently tracking GBP1.4 billion of acquisition opportunities alongside a watchlist of the same sum.

By Elijah Dale, Alliance News reporter

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Great Portland Estates PLC 339.50 GBX -1.31 -

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