Capital & Counties Properties (Capco), UK-based JSE-listed owner of Covent Garden estate, said the consumer appeal of London’s West End continued into 2023, with strong demand, occupancy and rental growth.
“Despite the macro-economic backdrop, the West End has clearly demonstrated its resilience and enduring appeal with strong recovery in footfall and customer sales ahead of pre-pandemic levels,” the group said yesterday at the release of its annual results to December 30, 2022.
As an indication of the weaker UK economy which would affect retail shopping activity, the International Monetary Fund predicted in January the UK’s gross domestic product would shrink this year.
Despite the upbeat forecast for Capco by its management, the share price fell 6.9% on the JSE yesterday morning to R26.16.
Capco is currently completing a merger with London property group Shaftesbury, with the aim of creating a leading central London mixed-use REIT, Shaftesbury Capital. The deal is expected to be complete on March 6.
“The combination creates an impossible to replicate £4.9 billion (R1078bn) portfolio located within some of the most iconic destinations of the West End. Backed by a strong balance sheet, we aim to deliver long-term economic and social value for our stakeholders,” the group said yesterday.
Capco declared a 2.5 pence dividend for the year, compared with 1.5 cents at the end of 2021. Underlying net rental income increased to £57.2 million in 2022 from £48.9m in 2021,
The independent property valuation of Covent Garden was £1.7bn, unchanged over the year, like-for-like.
Capco saw strong leasing momentum in 2022 delivering continued rental growth – 71 new leases and renewals were signed and there was a positive start to 2023 with £3.3m of income under offer. The balance sheet remained healthy with access to significant liquidity – cash and undrawn facilities came to £423m at year-end (2021: £642m).
BUSINESS REPORT