Land Secs profit soars on 'well-timed' development push

Land Securities has posted bumper results with pre-tax profit more than doubling to £2.4bn in the year to March, as the firm’s chief executie Robert Noel said the developer’s “well-timed” London development push was paying off.

Land Securities’ pre-tax profit was up from £1.1bn the previous year, while the value of its portfolio rose by £2bn to £14bn as office supply constraints in the capital pushed up property values.

Noel said that over the year the developer “reached the peak of our construction activity in our committed programme, just as the vacancy rate of quality office space in London was heading towards all-time lows.”

Noel said it enjoyed “record leasing levels” across the company’s London development programme.

Land Securities stole a march on rivals by committing to several major office schemes during the downturn, including the 20 Fenchurch Street tower, popularly known as the Walkie Talkie, which is now 92% let.

The firm still has 1.1 million sq ft to let in its development programme in London, but is confident of securing tenants due to the “lack of available, efficient, technically resilient space for businesses” in the city.

Land Securities added 21 Moorfields - a Crossrail oversite scheme at Liverpool Street - to its development pipeline in February, adding to its development plans at Westgate in Oxford, Buchanan Galleries in Glasgow.

Land Securities said any further development commitments beyond its current programme “will be based on pre-lettings”.

The firm provided an update on its vast Nova mixed-use project in Victoria, where 133 of the 170 apartments are pre-sold, 12% of the office space is in solicitors’ hands and 66% of the retail space is pre-let or in solicitors’ hands.

The firm’s 1 New Street Square development is fully let to Deloitte on a 20 year lease and 1&2 New Ludgate are 84% let or in solicitors’ hands.

The company during the year disposed of 47 Mark Lane, EC3; its 50% interest in 12/24 Oxford Street and 3-5 Tottenham Court Road and in March exchanged contracts to sell Times Square, EC4, for £284.6m.