SEGRO reveals strong first half of 2015
Industrial property giant SEGRO has announced that it has enjoyed a strong first half of 2015, with 4.3% year-on-year rental growth and positive revaluations of assets across all main markets.
In a press release on their website, SEGRO also revealed that IFRS profit before tax increased by over £100m to £330m compared to the previous year, while there was also an 8.3% increase in EPRA, which reflects improving asset values driven by strong investor demand.
Chief executive of SEGRO, David Sleath, said: “2015 is shaping up to be another good year for SEGRO, with strong operating metrics and portfolio performance, as the benefits of the portfolio re-shaping campaign continue to be felt.
We have experienced particularly strong demand from parcel delivery companies, third party logistics operations and retailers as economic conditions in our major markets continue to improve.”
The report also states that there is been strong investor demand for warehouseing across Europe, with the Group’s portfolio increasing in value by 6% to £5.2 billion, including a 7% increase in their completed UK portfolio.
SEGRO have also undergone a development programme geared towards areas with a limited supply of Grade A space and strong occupier demand. This will deliver 332,400 sq ft of new space, equating to £22m of new rent.
Commenting on the lack of supply, Sleath said: “The limited supply of high quality industrial and logistics space in our main markets, together with the impact of powerful structural drivers of demand for our products and sustained investor appetite for high quality assets, should be supportive of property returns for some time to come.
As it becomes increasingly difficult to secure acquisition opportunities which meet our return targets, we are focusing investment activity on our development programme, approving new construction and adding to our land bank in our core markets. We remain optimistic about our future operating performance as well as portfolio values.”