Resilient property values in London’s West End

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by Lin Freestone

Great Portland Estates, the landlord which specialises in offices in the West End of London, reports that the value of its property portfolio fell by just 0.2% last year to £1.6bn. This represents a decline of £2.7m.

The firm has benefited over other London property owners by focusing its investments in the West End.

In contrast, British Land, which has large office exposure in the City of London, has just recorded a fall of 10% in its property values.

Space is in short supply in the West End and demand is holding up, cushioning Great Portland from the countrywide slump.

Rental growth for buildings in the heart of the West End was 12.4% in the year to the end of March 2008. Total rental and other fees rose 33.1% to £72m. Pre-tax profit for the year was £23.8m, a rise of 36.8%.

Great Portland specialises in the purchase of rundown commercial buildings, which are improved to push up rents.