Shaftesbury swings to £120m profit as West End rebounds in FY22

Shaftesbury, the real estate investment trust that owns a 16.4-acre portfolio in London's West End, has announced the West End saw a “rapid rebound” in its full-year results, as it welcomed a strong recovery in footfall and spending, sustained occupier demand and a return to pre-pandemic occupancy. Its full-year profit-after-tax hit £119.1m, up from a £194.9m loss the prior year, while net property income rose by 28% to £82.8m, up from £64.7m previously. According to the group, a sustained recovery in confidence and activity drove growing footfall and spending ahead of 2019 levels. In light of this, occupiers reported average monthly sales that were now 6% ahead of pre-pandemic levels, with both hospitality and leisure and retail reporting rises of 6%. Over the period, Shaftesbury reported a strong demand for space across all uses which has in turn led to a return to pre-Covid occupancy levels and growth in rental values. Some 59 new hospitality and retail lettings were secured during the year. Meanwhile, rent collection now stands at 99%, back to pre-pandemic levels. Overall, the cash generated from operating activities was up 61.4% to £61.8m following the cessation of Covid-rent support as well as improvements in rent collections and occupancy. Looking ahead, the group said that prospects for London and the West End “remain bright,” despite the current range of macroeconomic challenges, adding that it “remains confident” in the long-term potential of its portfolio. In its latest update, the group also noted its proposed merger with Capco, the owner of Covent Garden, has been approved by Shaftesbury and Capco shareholders. Both groups are now engaged in customary pre-notification discussions with the CMA, which remain ongoing, though the proposed merger is expected to take place during the first quarter of 2023. Brian Bickell, CEO, said: "The year has seen a rapid rebound in the West End economy as Covid-related disruption receded and patterns of everyday activity returned to pre-pandemic normality. The sustained recovery in footfall and trading since the early months of 2022 has been matched by the strength of occupier demand in our carefully curated and popular locations. “Although London and the West End cannot be immune from the unprecedented range of challenges which are now dominating the national outlook, their long-term prospects remain bright, thanks to their enduring appeal to global, domestic and local visitors, businesses and investors, their dynamic economies and ability to attract talent and creativity from across the world.” He added: “These features are mirrored in the locations in which we invest and, together with our proven, innovative management strategy and our experienced and enthusiastic team, reinforce our confidence in the long-term potential of our exceptional portfolio."

Shaftesbury swings to £120m profit as West End rebounds in FY22

Over the period, Shaftesbury reported a strong demand for space across all uses which has in turn led to a return to pre-Covid occupancy levels and growth in rental values

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