GPE shares fall despite higher rents, stronger leasing
By Josh White
Date: Tuesday 18 Nov 2025
(Sharecast News) - Great Portland Estates shares fell more than 4% on Tuesday morning, after the landlord reported higher rents, stronger leasing activity and an uplift in portfolio values for the first half but maintained its interim dividend and reiterated guidance.
The FTSE 250 company highlighted continued demand for top-tier central London offices.
"We have delivered another period of strong operational performance across our prime central London portfolio, leasing more in the first half than in all of last year, driving up both our rents and our property values," said chief executive Toby Courtauld.
"It has been clear to us for a number of years that customers are choosing the best spaces in vibrant central London locations over the rest and this structural theme is as relevant today as ever; our leasing success and our 76% customer retention rate are a direct consequence of the premium quality of the HQ and Fully Managed spaces we create and the service offered by our award-winning customer experience team.
"From here, we expect London's economy to continue outperforming the UK overall."
Courtauld said the company's "prime located" one million square foot development and refurbishment programme was "already attracting significant interest" from prospective customers, with more than £10m under offer at a 30% premium to ERV, adding that it would generate further valuation surpluses of up to £520m.
"We will continue adding to our pipeline through acquisition, and profitably exiting completed business plans, all the while maintaining high liquidity and low leverage.
"We expect our growth strategy to generate attractive shareholder returns with a prospective 10%+ annualised return on equity and three-fold increase in EPRA EPS over the medium term."
The group said it completed 43 new leases and renewals in the period, securing £37.6m of annual rent, which was 7.1% above March estimated rental values.
Rent roll increased 29% over the past year, while like-for-like rental income rose 5%.
A further £10.3m of lettings are under offer at terms nearly 31% above ERV.
The company reiterated its rental growth guidance of 4% to 7% for the year, with prime offices expected to deliver between 6% and 10%.
GPE said it continued to recycle capital, selling two assets for £292m, 1.7% ahead of their March book value, including the £250m sale of 1 Newman Street at a net initial yield of 4.48%.
It also acquired The Gable in WC1 for £18m to expand its West End cluster.
Development momentum accelerated, with planning secured for three major schemes totalling 351,700 square feet, continued progress across six on-site projects and two new fully managed buildings delivered during the half.
The group said on-site HQ schemes were now 71% pre-let, including the recently agreed CD&R letting, and noted further space under offer.
Upcoming pipeline schemes carried a total capex of £392m, and were expected to generate a combined surplus of £179m based on current rents and yields, rising to £308m assuming 10% rental growth.
Portfolio valuation rose 1.5% to £3.1bn, driven by a 1.8% uplift in offices and a 6.1% increase across developments.
Rental values increased 2.6% overall, while EPRA net tangible assets per share rose 2% since March to 504p.
EPRA earnings climbed to £15.7m, lifting EPRA EPS by nearly 70% to 3.9p.
Return on equity over the past 12 months reached 7.5%.
The company strengthened its financial position with a new five-year £525m revolving credit facility signed in October at a headline margin of 105 basis points over SONIA.
Moody's affirmed its Baa2 long-term rating, and pro-forma EPRA loan-to-value stood at 28.2%, with £462m of cash and undrawn facilities and an average debt maturity of 5.9 years.
At 0933 GMT, shares in Great Portland Estates were down 4.04% at 308.5p.
Reporting by Josh White for Sharecast.com.
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