Business
First Quarter Business Update
First Quarter Business Update.
About this update from Derwent London Plc
[{"type":"text","content":"\n\n\n\n\n\nDerwent London plc (\"Derwent London\" / \"the Group\")\nFIRST QUARTER BUSINESS UPDATE\n\n\n\n\nPaul Williams, Chief Executive of Derwent London, said:\n\"The central London office market continues to see strong occupational demand against an ongoing backdrop of low supply. Larger occupiers are planning further ahead than ever before as the medium-term pipeline is squeezed. Investment volumes more than doubled to £2.4bn in Q1, compared to the prior year, driven by London's global appeal and the positive rental growth outlook.\nSince the start of the year, £14.3m of leasing and asset management transactions have completed or are under offer across our portfolio, with active discussions on multiple buildings. There is activity across our villages for both larger HQ spaces as well as smaller 'Furnished + Flexible' units.\n25 Baker Street W1 exemplifies our best-in-class offer and will be delivered shortly. All the offices and two of the six retail units are pre-let at rents well above ERV and contracts have exchanged on 20 of the private residential units for £98.4m, significantly exceeding appraisal value. At Network W1, practical completion is due at the end of 2025 and we are in discussions with several potential occupiers. Works are also advancing on our major refurbishments including Middlesex House W1, 1-2 Stephen Street W1 and 1 Oliver's Yard EC1.\nWe have a high quality portfolio with an attractive average lease term and a substantial development pipeline, which positions us strongly for current and future markets. Our focus on earnings, regeneration and recycling underpins our positive total return outlook, and we reiterate our 2025 portfolio ERV guidance of 3-6%.\"\n\nOperational update\n\nLeasing activity in the year to date totals £2.7m, with a further £3.7m of rent under offer. Open market lettings were agreed 2.7% ahead of December 2024 ERV. This includes £0.8m of 'Furnished + Flexible' lettings, signed 6.3% above ERV.\nRenewals and regears totalling £2.9m have also completed since the start of the year, and a further £5.0m of deals are under offer. Excluding a short-term transaction at 50 Baker Street W1 ahead of scheme commencement in H1 2026, new rent agreed was on average 8.7% above the previous rent.\nOur EPRA vacancy rate remains low at 3.4% (31 December 2024: 3.1%).\nAs previously announced, proceed...