Shaftesbury hails West End recovery: Owner returns to profit as shoppers splash cash and tourists return
The owner of large swaths of London’s West End has returned to profit as shoppers splashed the cash and tourists returned to the capital.
Shaftesbury, a FTSE 250 owner who owns areas such as Chinatown, Carnaby Street and parts of Fitzrovia near Oxford Street, posted a profit of £119million for the year to the end of September, compared with a loss of £195m in 2021.
Rent collection from its tenants, which include retailers, pubs and restaurants, has returned to pre-pandemic levels as many reported monthly sales around 6% higher than seen in 2019.
Sales up: Shaftesbury, which has areas such as Chinatown, Carnaby Street and parts of Fitzrovia near Oxford Street, posted a profit of £119million for the year to the end of September
Vacancy rates have also returned to pre-Covid levels with growing demand for high-end commercial and retail space.
‘The year has seen a rapid rebound in the West End economy as Covid-related disruption receded and day-to-day business patterns returned to pre-pandemic normalcy,’ the chief executive said. Brian Bickell.
He added that while the company’s properties “cannot be immune” to challenges in the wider economy, the long-term outlook was “brilliant”.
The strong rally allowed the company to increase its dividend by almost 55% to 9.9 pence per share.
Shares in the company rose 1.5%, or 5.2p, to 364.2p.
But a black spot was the value of his 16-acre property portfolio, which fell 3.6% between March and September of the year as interest rates rose and the outlook for the economy darkened. world were hitting the real estate markets.
Despite this, the group’s portfolio was still valued at £3.2bn at the end of September, up 3.6% on the previous year.
Commercial landlords such as Shaftesbury have also taken advantage of the recent weakness in the pound, which has made the UK an attractive destination for American tourists looking to put their dollar to work.
Shaftesbury’s return to profit comes as it prepares to merge with rival Capco, which also has a portfolio of prime venues in London, including the Covent Garden market.
The £5billion combination of the two, due to be completed early next year, will bring together some of the West End’s most valuable areas in a 2.9 square meter empire comprising shops, restaurants, offices and housing.
Bickell is expected to step down after the merger, with the company being led by Capco chief executive Ian Hawksworth.
Although the merger has been approved by shareholders of both companies, it is being reviewed by competition authorities.
Interested parties should comment on the potential merger by this Friday, after which a decision will be made.