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Real estate giant Land Securities has raised its guidance for the year as it moves away from office development toward retail sites and building more homes.
Despite broader pressures in the economy, bosses reported “clear positive momentum” across the company.
Land Securities (LandSec) told shareholders it is on track to deliver net rental income growth of between 4% and 5% this financial year, having previously guided between 3% and 4%.
It also said it was set to report earnings per share at the “top end” of the previous target.
The group said earnings per share rose 3.2% in the last half year, driven by a 5.2% rise in like-for-like income and a boost from cutting overhead costs.
However, Bluewater’s majority owner also revealed that pre-tax profit fell to £98 million for the six months to September 30, compared with £243 million a year earlier, amid losses linked to the sale of assets.
The company noted a loss of approximately £67 million related to the sale of assets worth £644 million, “which yielded little or no return”.
This included the sale of four retail parks including Lakeside throckFor approximately £261 million.
Landsec also struck a £245 million deal to sell Queen Anne House The office development, which is due to close next month amid its strategy to reduce its investment in the office market.
The company said it will complete two new office developments in the coming months and has earmarked additional investment of around £200 million for the area, but “does not intend to add meaningfully to this over the next 12-18 months”.
It said it would “prioritise acquisition opportunities in the retail sector” following recent deals to increase its stake in popular retail destinations such as Bluewater and. liverpool One.
Landsec also said it had made further early progress in efforts to establish a residential operation worth £2 billion or more.
It has pledged to grant detailed planning consent for the first 879 homes on the Mayfield site manchester And it is also progressing plans for a development of 2,800 homes in Lewisham.
Chief executive Mark Allen said: “Despite the broader economic environment, we continue to see clear positive momentum across every part of our business.
“Owning the right real estate has never been more important, so we are benefiting from our active portfolio repositioning over the last few years, and our entire business is also benefiting from a greater focus on sustainable EPS (earnings per share) growth as our primary performance objective, which provides greater clarity in terms of priorities and decision making.”