Derwent London Plc · LSE:DLN
Derwent London — FY2012 Earnings Presentation
101 slides from Derwent London's earnings presentation, 2013
Slide 1: Derwent London plc Results 2012
Derwent London plc Results 2012
Slide 2: Contents
Contents Presenters: Contents: Page John Burns Introduction 2 Results and financial review 7 Simon Silver Valuation and portfolio analysis 18 Lettings and asset management 26 Damian Wisniewski Acquisitions and disposals 34 Projects 42 Nigel George Outlook for central London property 59 Paul Williams
Slide 3: Introduction
DERWENT LONDON Introduction John Burns
Slide 4: Highlights 2012
Highlights 2012 ● Strong results • NAV growth +11% (Portfolio +7%) • PBT maintained despite increased development • DPS raised 7.5% ● Operations • Vacancies remain at historically low levels (1.6%) • Let 340,000 sq ft of space (7.6% above ERV) ● Portfolio activity • Acquired £101m of Derwent style s
Slide 5: Good demand for our space
Good demand for our space ● Vacancy rate remains low at 1.6% ● Asset management initiatives • 1 Oliver’s Yard & 8 Fitzroy Street - extended £9m of rent with minimum uplifts ● New lettings exceed ERVs and annual market growth • Burberry, largest pre-let in West End in 2012 (1 Page Street) • Ticketmas
Slide 6: Excellent progress on our developments
Excellent progress on our developments ● Completed 4 & 10 Pentonville Road achieving over 60% return on development cost ● Achieved 655,000 sq ft new planning consents, taking consented pipeline to 1.8m sq ft ● Started 170,000 sq ft during the year leading to 495,000 sq ft under construction at the
Slide 7: Further recycling activity
Further recycling activity ● Five principal properties (247,500 sq ft) acquired for £90m • 74% core West End, 26% City borders • Income producing average net initial yield 4.7% • Average cost £365 per sq ft • Also acquired new headlease at 1-5 Grosvenor Place for £8m Net investment (cash) ● Sold thr
Slide 8: Results and financial review
Results and financial review Damian Wisniewski 7
Slide 9: Headline numbers
Headline numbers Dec 2012 Dec 2011 % change Total portfolio at fair value £2,859.6m £2,646.5m 8.1 EPRA net asset value per share1 1,886p 1,701p 10.9 Gross property income £124.8m £125.5m (0.6) EPRA profit before tax 2 £52.5m £52.3m 0.4 EPRA earnings per share 50.36p 51.59p (2.4) Profit for the year
Slide 10: Group balance sheet
Group balance sheet ● EPRA NAV per share up 10.9% • To 1,886p from 1,701p Debt, net assets and gearing • Split 4.1%/6.8% in H1/H2 2,000 100 1,800 1,860 90 ● Equity shareholders’ funds increased to £1,860m 1,739 1,600 1,663 80 1,611 1,400 1,449 70 ● Net debt increased slightly 1,200 60 • To £874.8m f
Slide 11: EPRA NAV movement
EPRA NAV movement ● At £175.3m or 170p per share, the overall revaluation surplus was higher in 2012 than EPRA NAV per share in 2011 2,000 1,950 7 ● Revaluation surplus: 50 (30) 1,900 • income statement £174.4m (7) (5) 1,886 • comprehensive income1 £0.9m 1,850 170 £175.3m 1,800 Pence (p) 1,750 ● EPR
Slide 12: EPRA profit before tax
EPRA profit before tax ● Rental income increased to £124.7m • Strong rise in like-for-like income EPRA profit before tax 140 ● Surrender premiums fell from £1.4m in 2011 2.5 0.1 to £0.1m in 2012 120 124.7 (10.3) ● Admin costs up by 7% due largely to higher 100 (24.5) staff costs 80 £m ● Breakdown of
Slide 13: Gross property income
Gross property income 2012 2011 Increase £m £m £m Rental income 116.5 115.3 1.2 Surrender premiums received1 0.1 1.4 (1.3) SIC15 lease incentives 8.2 8.8 (0.6) Gross property income Gross property income 124.8 125.5 (0.7) movements in 2012 140 135 ● Acquisitions include: Francis House £0.8m 4.6 (2.7
Slide 14: Property outgoings and EPRA like-for-like rental income
Property outgoings and EPRA like-for-like rental income Recurring property outgoings decreased by £1.8m 2012 2011 mainly due to void costs at Angel Building and £m £m Riverwalk House in 2011 Property outgoings 10.4 12.2 Ground rents 0.5 0.3 Property outgoings at Hampstead Road were £0.6m Surrender p
Slide 15: Cashflow
Cashflow Net cashflow movements ● Small increase in net debt 2012 2011 • By £10.3m to £874.8m £m £m Cash from operations 51.8 47.2 ● Disposals include Riverwalk House, Acquisitions (99.8) (91.6) Triangle Centre and 50% share in Grosvenor Place Capex (17.4) (78.6) (2.7) (42.6) Disposal proceeds 161.0
Slide 16: Debt summary
Debt summary Dec 2012 Dec 2011 Net debt £874.8m £864.5m Gearing LTV ratio 30.0% 32.0% NAV 45.6% 50.4% Interest cover ratio 351% 307% Interest cover ratio - excluding capitalised interest 309% 291% Total facilities £1,204m £1,335m Unutilised committed facilities £333m £476m Unutilised facilities draw
Slide 17: Debt facilities, covenants and gearing
Debt facilities, covenants and gearing ● Weighted average maturity • Facilities - 5.4 years • Drawn amounts - 6.1 years Maturity profile of loan facilities1 - as at 31 Dec 2012 £m ● Total facilities excluding overdraft: £1,201m 0 50 100 150 200 250 300 350 400 including overdraft: £1,204m 2013 2014
Slide 18: Liability risk management
Liability risk management Dec 2012 Dec 2011 Proportion of drawn facilities at fixed rates or hedged 92% 98% Weighted average length of swaps 5.8 years 5.0 years 1 Spot weighted average cost of drawn facilities 4.63% 4.65% Spot weighted average cost of drawn facilities 2 4.88% 4.91% Mark-to-market co
Slide 19: Valuation and portfolio analysis
Valuation and portfolio analysis Nigel George 18
Slide 20: Valuation
Valuation ● Strong capital growth throughout 2012 • Underlying 7.3% (2011: 7.6%) • Central London portfolio 7.8% (City borders top performing 10.2%) • Continued strong growth fundamentals (average ‘topped-up’ office rent £31 psf / TEY 5.55%) ● Seven projects on site during 2012, valued at £387.6m •
Slide 21: Valuation performance
Valuation ● Central London continues to perform strongly ● Our portfolio outperformed the IPD Central London Offices Index and the wider market ● Total 2012 property return of 11.6% (2011: 13.4%) • IPD Central London Offices1 8.8% Valuation performance • IPD All UK Property1 2.7% 20 15 15.7 16.5 Val
Slide 22: Yields and income
Yields and income ● EPRA yields • Net initial 4.3% (Dec 2011: 4.4%) • ‘Topped-up’ net initial 4.8% (Dec 2011: 5.2%) ● True equivalent yield (TEY) 5.55% True equivalent yield movement • Tightened by 6bp in 2012 • Yields stable 7.5 ● Net reversionary yield 5.7% 15bp 7.0 True equivalent yield (%) 83bp
Slide 23: Rental value
Rental value ● 2012 rental value growth • Rental growth above our 4-5% expectations in March 2012 • Underlying H1 2.8% and H2 3.8% ● City borders outperforming with growth at 11.4% in 2012 • Examples of ERV movement; Rental value growth • Tea Building +17% • Oliver’s Yard +13% 9 • Morelands Building
Slide 24: Vacancy rates
Vacancy rates ● EPRA vacancy rate1 by rental value 1.6% at Dec 2012 • Slight increase from 1.3% at Dec 2011 • Pentonville Road completed ● Available floorspace 66,000 sq ft with an ERV of £2.1m pa • 50% now let or under offer Vacancy rates ● Projects on site total 495,000 sq ft • Net rental value c.
Slide 25: Lease expiries and breaks
Lease expiries and breaks ● Continued strong tenant retention - highest over five years at 81% ● Active asset management ● 2013 expiries and breaks • Equates to £20m pa or 17% of annual rent roll • 25% relates to 80 Charlotte Street project Lease expiry and break outcomes1 100 ● Portfolio average le
Slide 26: Low average office rents
Low average office rents ● Central London offices represents 86% of current income Income % Central London offices 86 Retail/restaurant 7 Central London office rent profile Leisure/hotel 2 40 Other 2 Dec-11 Jun-12 Dec-12 97 35 Scotland 3 35.64 34.74 Total 100 32.66 30 31.10 31.50 31.18 ● Rents passi
Slide 27: Lettings and asset management
Lettings and asset management Paul Williams 26
Slide 28: 4 & 10 Pentonville Road N1 (55,000 sq ft - 87% let)
4 & 10 Pentonville Road N1 (55,000 sq ft - 87% let) 4 & 10 Pentonville Road Angel Building ● Let 47,700 sq ft to Ticketmaster for £1.9m pa (£42.50 psf on a typical floor) ● 12-year lease (30 months rent free), no breaks, minimum uplift to £2.0m pa in year five ● Good interest in the balance ● New le
Slide 29: 1 Page Street SW1 (127,000 sq ft)
1 Page Street SW1 (127,000 sq ft) Horseferry House 1 Page Street ● Pre-let to Burberry for £5.3m pa (£45 psf on a typical floor) ● Completion due in Q2 2013 ● 127,000 sq ft - largest West End letting in 2012 ● Minimum uplift in year five to £5.7m pa ● In 2008 the Group completed the Burberry headqua
Slide 30: Buckley Building EC1 (85,000 sq ft)
Buckley Building EC1 (85,000 sq ft) Buckley Building Farringdon Crossrail station ● Completion Q1 2013 ● Pre-let 21,100 sq ft to Unilever ● In the heart of Clerkenwell village ● 81,000 sq ft offices, 4,000 sq ft ● Rent £45 psf on ground and £40 ● Close to Farringdon station and will restaurant/retai
Slide 31: 55-65 North Wharf Road W2 (240,000 sq ft)
55-65 North Wharf Road W2 (240,000 sq ft) Existing ownership structure ● Headlease: 83 years unexpired ● Ground rent: Review in 2013 and every 21 years to 15.5% of income ● Net income: £1.5m pa ● Building: 78,000 sq ft Multi-let offices Possession from 2014 Option agreement ● Headlease: 999 years ●
Slide 32: 55-65 North Wharf Road W2 (240,000 sq ft)
55-65 North Wharf Road W2 (240,000 sq ft) Option agreement for 999-yr headlease at 2.5% of income Derwent London European Land Offices Residential 240,000 sq ft 73,000 sq ft 31
Slide 33: 1-5 Grosvenor Place SW1
1-5 Grosvenor Place SW1 ● 50% JV with Grosvenor completed in February 2012 ● New 150-year headlease ● 1.5 acre prime site ● Potential >260,000 sq ft mixed use: hotel, residential, offices ● Pre-planning discussions with partner, architects and potential hotel operators ● Current rent £3.1m (DL share
Slide 34: 132-142 Hampstead Road NW1 (217,000 sq ft)
132-142 Hampstead Road NW1 (217,000 sq ft) ● Acquired September 2007 as major development opportunity ● Obtained planning in December 2010 for 233,000 sq ft offices (White Collar Factory) and 38 residential units ● Significant pre-letting interest ● Project put on hold due to potential HS2 impact ●
Slide 35: Acquisitions and disposals
Acquisitions and disposals David Silverman 34
Slide 36: Acquisitions in 2012
Acquisitions in 2012 Principal acquisitions Property Area Cost1,2 Cost1 Net yield Rent ERV Lease length3 sq ft £m £ psf % £ psf £ psf years 25 and 29 Berners Street W1 79,500 36.5 460 3.8% 18 37 1.5 9 and 16 Prescot Street E1 111,000 23.2 209 5.5% 11 15 2.4 Francis House, 11 Francis Street SW1 57,00
Slide 37: 25 and 29 Berners Street W1 (79,500 sq ft)
25 and 29 Berners Street W1 (79,500 sq ft) ● Long leaseholds (2080). Ground rent £3,125 pa. ● Sale and leaseback from Performing Rights Society for three years (tenant’s break from 18 months) for £1.4m pa (£17.60 psf) ● Net initial yield is 3.8% ● Good floor to ceiling heights, excellent natural lig
Slide 38: 25 and 29 Berners Street W1 - redevelopment potential
25 and 29 Berners Street W1 - redevelopment potential If combined with 28 Berners Street potential for 100,000 sq ft+ redevelopment 29 Berners Street 25 Berners Street Refurbishment Refurbishment 44,300 sq ft 35,200 sq ft 37
Slide 39: 9 and 16 Prescot Street E1 (111,000 sq ft)
9 and 16 Prescot Street E1 (111,000 sq ft) ● A new location for Derwent ● Located in an improving area of Whitechapel, offering asset management angles in the short-term whilst providing an interesting future refurbishment opportunity ● Initial rent £1.3m and net initial yield of 5.5% ● Both freehol
Slide 40: Francis House, 11 Francis Street SW1 (57,000 sq ft)
Francis House, 11 Francis Street SW1 (57,000 sq ft) ● Former Victorian depositary benefiting from good floor to ceiling heights and original warehouse features ● Freehold 57,000 sq ft ● Channel 4 Television expiring 2020 ● Offices let off a low average rent of £37 psf - £1.6m pa until February 2015
Slide 41: Disposals in 2012
Disposals in 2012 ● Sold three properties and a 50% share of Grosvenor Place for £161m after costs on 2.9% disposal yield Riverwalk House 1-5 Grosvenor Place Triangle Centre, Scotland ● Together with 232 Vauxhall Bridge ● Creation of new 50/50 JV with ● Non-core retail asset, part of the Road, sold
Slide 42: Commercial Road E1 - crystallising planning uplift
Commercial Road E1 - crystallising planning uplift ● Recycling capital post year end ● Existing buildings total 36,000 sq ft ● Planning achieved for 122,000 sq ft student accommodation in November 2010 ● Vacant possession received in 2012 ● Sold to a specialist provider for £17m ● Sale reflects 26%
Slide 43: Projects
DERWENT LONDON Projects Simon Silver 42
Slide 44: Creating tomorrow's space today
Creating tomorrow’s space today ● Active projects • Six projects (0.5m sq ft) in hand for completion 2013-14 (Morelands Buildings now completed) • Three projects (0.4m sq ft) to start 2013 for completion 2014-16 ● Three subsequent projects with planning (0.5m sq ft offices and 0.04m sq ft retail) •
Slide 45: Turnmill EC1 (70,000 sq ft)
Turnmill EC1 (70,000 sq ft) Turnmill Farringdon Crossrail station ● Acquired in 2004 for £9m ● Part of our Clerkenwell village ● 41,000 sq ft offices ● Next to new entrance to the Crossrail station at Farringdon ● Prominent corner site ● Planning received for new 70,000 sq ft building in 2011 44
Slide 46: Turnmill EC1 (70,000 sq ft)
Turnmill EC1 (70,000 sq ft) ● 58,000 sq ft offices ● 12,000 sq ft retail/restaurant ● Office ERV c.£47.50 psf ● Completion due Q3 2014 45
Slide 47: Turnmill EC1 (70,000 sq ft)
Turnmill EC1 (70,000 sq ft) 46
Slide 48: 40 Chancery Lane WC2 (100,000 sq ft)
40 Chancery Lane WC2 (100,000 sq ft) 40 Chancery Lane Lincoln’s Inn ● Short leasehold & part freehold interest acquired in 1999 ● Tenure restructured in 2012 onto a 128-year lease ● Ground rent is 18% with an option to reduce to 10% ● Freeholder (Colville Estate) will receive overage above target re
Slide 49: 40 Chancery Lane WC2 (100,000 sq ft)
40 Chancery Lane WC2 (100,000 sq ft) 48
Slide 50: 40 Chancery Lane WC2 (100,000 sq ft)
40 Chancery Lane WC2 (100,000 sq ft) 49
Slide 51: 1-2 Stephen Street W1 & 18-30 Tottenham Court Road W1
1-2 Stephen Street W1 & 18-30 Tottenham Court Road W1 ● Central Cross W1 (251,000 sq ft) acquired for £146m in July 2010 18-30 Tottenham Court Road ● The property is subject to a rolling refurbishment 1-2 Stephen Street ● Rebranding the property, and location ● Following completion of Phases 1-3, c.
Slide 52: 1-2 Stephen Street W1 (86,000 sq ft refurbishment)
1-2 Stephen Street W1 (86,000 sq ft refurbishment) ● Phase 1 creation of new entrance on Stephen Street frontage, and 23,000 sq ft offices ● Phase 2 63,000 sq ft offices ● ERV of Phases 1 & 2 is c.£4.6m ● 18% pre-let to BrandOpus £0.65m (£52.50 psf) ● Completion 2013/2014 51
Slide 53: 18-30 Tottenham Court Road W1 (41,000 sq ft refurbishment)
18-30 Tottenham Court Road W1 (41,000 sq ft refurbishment) ● Phase 3 planning for 41,000 sq ft retail extension achieved in Q3 2012 ● Vacant possession in Q2 2014 ● Capex £11m ● ERV c.£3m (Zone A £270) ● Current rental income £0.7m 52
Slide 54: 2013 starts: 80 Charlotte Street W1
2013 starts: 80 Charlotte Street W1 Charlotte Street projects 80 Charlotte Street 67 Whitfield Street 53-65 Whitfield Street Derwent ownerships 67 Whitfield Street 53-65 Whitfield Street 80 Charlotte Street 53
Slide 55: 80 Charlotte Street W1
80 Charlotte Street W1 ● New pocket park in Fitzrovia 54
Slide 56: 80 Charlotte Street W1
80 Charlotte Street W1 ● Saatchi & Saatchi lease expires Q3 2013 ● 300,000 sq ft new offices ● 20,000 sq ft retail/restaurant ● 65,000 sq ft related space (see Appendix 17) ● Commit in 2013 55
Slide 57: White Collar Factory EC1
White Collar Factory EC1 ● In December 2012, Government announced it will invest £50m in the Silicon Roundabout area ● Latest estimates are that 3,200 TMT firms employing some 48,000 people in the Hoxton to Soho area 1 Oliver’s Yard White Collar Factory Silicon Roundabout 56
Slide 58: White Collar Factory EC1
White Collar Factory EC1 ● Six existing properties (124,000 sq ft) form 1 acre site for the new development ● In 2011 planning secured for 289,000 sq ft new development: • 220,000 sq ft 16-storey office building • 62,000 sq ft office campus (4 buildings) • 7,000 sq ft residential 57
Slide 59: White Collar Factory EC1
White Collar Factory EC1 ● Q1 2013 completion of 3,000 sq ft ‘live suite’ to finalise design ● Capex c.£100m ● ERV c.£11m ● ERV £40-45 psf 58
Slide 60: Outlook for central London property
Outlook for central London property John Burns 59
Slide 61: West End office supply
West End office supply 2012 Outlook West End office development pipeline Vacancy rate 2.5 12.5 Proposed Under construction Completed Vacancy Rate ● Potential supply increasing 2.0 10.0 • Vacancy rate fell from 4.3% to 4.2% Floor area (million sq ft) • 10-year average 5.3% Vacancy rate (%) • Only 31%
Slide 62: West End office demand
West End office demand 2012 Outlook 2012 Outlook West End take-up Rental Take-up 6 values ● Take-up of 3.5m sq ft 5 ● 16% below 10-year average Average Take-up (million sq ft) ● Only one letting >100,000 sq ft 4 ● TMT represented 23% of take-up ● Consumer & Leisure (19%) and Business Services (17%)
Slide 63: London's Tech Belt
London’s Tech Belt ● Boundaries are dynamic ● Estimated size c.22m sq ft or around 10% of central London office market Expedia Angel Building Film London Tea Building Krow Communications 80 Goswell Road Method Tea Building Mother Advertising Tea Building 151 Rosebery R/GA Avenue Sage Angel Building
Slide 64: London's Tech Belt
London’s Tech Belt City Fringe availability (ex SE1) ● Increasingly a focus of demand due to improving areas, 4.5 18 Available space Vacancy rate transport, and rental pressures in the centre 4.0 16 3.5 14 Available space (m sq ft) ● Wide range of office property sizes and quality. Lower density. 3.
Slide 65: Central London office investment market
Central London office investment market 2012 Outlook Central London office investment Yields 18 16 Value of investment transactions (£bn) ● One of the strongest in recent years 14 • Transactions of £14bn in 2012 • 28% above 10-year average 12 Average 10 • Overseas investors accounted for 67% • Overs
Slide 66: Outlook for Derwent London
Outlook for Derwent London John Burns 65
Slide 67: On-site development projects
On-site development projects + 25% pre-let 100% pre-let Buckley Building 1 Page Street Turnmill Chancery Lane Total Anticipated completion date Q1 2013 Q2 2013 Q3 2014 Q4 2014 Floor area (sq ft) 85,000 127,000 70,000 100,000 382,000 Estimated capex to complete (£m) 3 15 19 34 71 Total cost (£m)1 43
Slide 68: 2013 project starts
2013 project starts Bishop’s Bridge Road 73 Charlotte Street 80 Charlotte Street 2 Total Start/anticipated completion Q1 2013/Q4 2014 Q4 2013/Q2 2015 Q4 2013/Q2 2016 Floor area (sq ft) 21,000 16,000 385,0001 422,000 Current rent (£m) - 0.2 5.1 5.3 Estimated capex to complete (£m) 12 9 147 168 Total
Slide 69: Platform for growth
Platform for growth Based on December 2012 rents ● Existing investment portfolio has potential to add £31m pa (44% contracted) ● Committed development programme has potential to add £35m (21% pre-let) after c.£225m future capex ● Positioned to start two major projects with potential to add £21m afte
Slide 70: Potential delivery 2013-20
Potential delivery 2013-20 ● c.2.7m sq ft probable deliveries by 2020 (average 0.3m sq ft pa) Potential development delivery by 20201 ● Two thirds consented 0.7 Current 2013 Starts Potential • Of which half to be committed by end 2013 0.6 Estimated completions (million sq ft) 0.5 0.4 0.3 White Colla
Slide 71: Outlook for 2013
Outlook for 2013 Our ● Rental growth estimated at c.4-6% market ● Yields expected to remain firm ● Property portfolio well positioned for • Market growth • Organic growth Growth ● Right-sized financial base platform • Sound interest/dividend cover • LTV 30% • Undrawn facilities £333m at a marginal c
Slide 72: Appendices
DERWENT LONDON Appendices 71
Slide 73: Appendices
Appendices Page Page 1. Group balance sheet 73 15. Rent banding and tenant profile 87 2. Net asset value per share 74 16. Lease extensions meeting tenants’ requirements 88 3. Group income statement 75 17. Other Charlotte Street W1 projects (65,000 sq ft) 89 4. Reconciliation of IFRS and EPRA profits
Slide 74: Appendix 1 - Group balance sheet
Appendix 1 - Group balance sheet Dec 2012 Dec 2011 £m £m Investment property 2,772.6 2,444.9 Owner-occupied property 17.9 17.1 Other non-current assets 74.2 67.4 2,864.7 2,529.4 Non-current assets held for sale 16.5 137.5 Other current assets and liabilities (31.4) (27.5) Cash and cash equivalents 4
Slide 75: Appendix 2 - Net asset value per share
Appendix 2 - Net asset value per share Dec 2012 Dec 2011 Basic Diluted Basic Diluted £m p p £m p p Net assets attributable to equity shareholders 1,860.4 1,824 1,814 1,662.7 1,636 1,625 Fair value of secured bonds (21.2) (20.8) Fair value of unsecured bonds (20.0) 2.4 Fair value of fixed rate secure
Slide 76: Appendix 3 - Group income statement
Appendix 3 - Group income statement Year ended Year ended Dec 2012 Dec 2011 £m £m Gross property income 124.8 125.5 Other income 2.5 2.0 Property outgoings (10.6) (11.4) Property outgoings Rates credits 0.3 (10.3) (9.8) 1.6 Net property income 117.0 117.7 Admin expenses (24.5) (22.8) Total administr
Slide 77: Appendix 4 - Reconciliation of IFRS and EPRA profits
Appendix 4 - Reconciliation of IFRS and EPRA profits Reconciliation of IFRS profit before tax to EPRA and underlying profit before tax Year ended Dec 2012 Year ended Dec 2011 EPS p £m £m IFRS profit before tax 222.76 228.1 233.0 Revaluation surplus (174.4) (170.1) Joint venture revaluation surplus (
Slide 78: Appendix 5 - EPRA like-for-like rental income
Appendix 5 - EPRA like-for-like rental income Properties owned throughout Development the period Acquisitions Disposals property Total £m £m £m £m £m 2012 Rental income 112.3 3.6 1.4 7.4 124.7 Property expenditure (5.7) (0.6) (0.9) (3.4) (10.6) Net rental income 106.6 3.0 0.5 4.0 114.1 Other1 2.6 -
Slide 79: Appendix 6 - Debt facilities
Appendix 6 - Debt facilities Dec 2012 £m £m Maturity 6.5% secured bonds 175 March 2026 3.99% secured loan 83 October 2024 2.75% unsecured convertible bonds 175 July 2016 Overdraft 2.5 On demand Committed bank facilities Term 28 June 2018 Term/revolving credit 90 December 2017 Revolving credit 150 Ja
Slide 80: Appendix 7 - Net debt
Appendix 7 - Net debt Dec 2012 Dec 2011 £m £m £m £m Overdraft - - Financial liabilities - due within 1 year - 32.5 Financial liabilities - due after more than 1 year 879.2 835.5 Acquired fair value of secured bonds less amortisation (16.4) (17.2) Unamortised loan arrangement costs 6.7 3.5 Leasehold
Slide 81: Appendix 8 - Valuation performance by village
Appendix 8 - Valuation performance by village Valuation Valuation Weighting movement Dec 2012 Dec 2012 20121 £m % % West End: Central Fitzrovia2 1,074.3 38 6.3 Victoria 370.5 13 5.2 Baker Street/Marylebone 140.4 5 8.6 Soho/Covent Garden 123.0 4 5.0 Belgravia 78.0 3 2.0 Mayfair 60.0 2 5.1 Paddington
Slide 82: Appendix 9 - Valuation drivers & rental value growth
Appendix 9 - Valuation drivers & rental value growth Drivers of valuation movement1 Other Rental value growth Yield shift Dec-12 24 61 15 Jun-12 -5 75 30 Dec-11 - 68 32 Jun-11 -6 70 36 Dec-10 28 42 30 -20 0 20 40 60 80 100 120 Rental value growth Contribution to valuation movement (%) 2011 H1 2012 H
Slide 83: Appendix 10 - Valuation yields
Appendix 10 - Valuation yields Yields EPRA initial yields 9 Pre-EPRA EPRA Net initial ‘Topped-up’ 8 yield initial yield % % 7 West End 4.2 4.6 Yield (%) 6 City Borders 4.7 5.3 Central London 4.3 4.8 5 Provincial 6.3 7.0 4 EPRA portfolio 4.3 4.8 Initial yield True equivalent yield Reversionary yield
Slide 84: Appendix 11 - Portfolio reversion
Appendix 11 - Portfolio reversion Rental uplift pa Rental pa £m £m £m Contracted rental income, net of ground rents 119.6 Contractual rental uplifts 1 Page Street SW1 (pre-let) 5.3 Buckley Building EC1 (pre-let) 0.9 1-2 Stephen Street W1 (pre-let) 0.7 Morelands Buildings EC1 (pre-let) 0.6 Other (ste
Slide 85: Appendix 12 - Vacant space - available and projects
Appendix 12 - Vacant space - available and projects Vacant Pre-let Total Total Total area area area Vacant Pre-let gross Ground net ‘000 ‘000 ‘000 ERV ERV ERV rent ERV sq ft sq ft sq ft £m pa £m pa £m pa £m pa £m pa Comment Available to occupy Tea Building E1 10 - 10 0.3 - 0.3 - 0.3 Greencoat House
Slide 86: Appendix 13 - Portfolio statistics by village
Appendix 13 - Portfolio statistics by village Rent Vacant Net Vacant review / Floor floor contracted Average space lease Estimated area area rental rental rental renewal Total rental Valuation Weighting sq ft sq ft income income value reversion reversion value £m % ‘000 ‘000 £m pa £ psf £m pa £m pa
Slide 87: Appendix 14 - Lease expiry profile and lease length
Appendix 14 - Lease expiry profile and lease length Expiries and breaks as percentage of portfolio income1 West City End Borders 2013 2014 2015 2016 2017 Total Expiries 8 2 10 4 6 4 2 26 Holding over - - - - - - - - Rolling breaks 3 2 5 2 - - - 7 Single breaks 1 1 2 8 2 4 2 18 12 5 17 14 8 8 4 51 Pr
Slide 88: Appendix 15 - Rent banding and tenant profile
Appendix 15 - Rent banding and tenant profile Central London ‘topped-up’ office rent banding1 Profile of tenants’ business sector2 £60+ psf £0 - £20 psf Other Government and 7% 3% 7% public admin £50 - £60 psf 3% Media, TV, marketing 12% Charities £20 - £30 psf and advertising 5% 29% 14% Financial 5
Slide 89: Appendix 16 - Lease extensions meeting tenants' requirements
Appendix 16 - Lease extensions meeting tenants’ requirements 1 Oliver’s Yard EC2 (185,000 sq ft) 8 Fitzroy Street W1 (148,000 sq ft) Charlotte Building W1 ● Sage - lease extensions on 40,300 sq ft ● Arup - five-yearly upward only rent ● Surrender and immediate re-letting from 2 to 7 years with stepp
Slide 90: Appendix 17 - Other Charlotte Street W1 projects
Appendix 17 - Other Charlotte Street W1 projects (65,000 sq ft) 67 Whitfield Street W1 53-65 Whitfield Street W1 Suffolk House, 1 Whitfield Place W1 ● 13,700 sq ft private residential ● 11,700 sq ft offices ● 12,700 sq ft affordable housing ● 3,900 sq ft retail ● 20,700 sq ft private residential (13
Slide 91: Appendix 18 - Queens, Bishop's Bridge Rd W2
Appendix 18 - Queens, Bishop’s Bridge Rd W2 (21,400 sq ft) ● Cinema conversion ● 16 private flats (18,700 sq ft) ● 2,700 sq ft of retail ● Completion Q4 2014 90
Slide 92: Appendix 19 - 73 Charlotte Street W1
Appendix 19 - 73 Charlotte Street W1 (15,500 sq ft) ● Planning achieved Q4 2012 ● 11,700 sq ft private residential (9 units) ● 1,900 sq ft affordable (2 units) ● 1,900 sq ft offices 91
Slide 93: Appendix - Central London office vacancy
Appendix 20 - Central London office vacancy 16 West End 14 City Central London 12 West End 10-yr average City 10-yr average Vacancy rate (%) 10 8 6 4 2 0 Q4 02 Q4 03 Q4 04 Q4 05 Q4 06 Q4 07 Q4 08 Q4 09 Q4 10 Q4 11 Q4 12 Source: CBRE 92
Slide 94: Appendix - Central London office vacancy v rental growth
Appendix 21 - Central London office vacancy v rental growth 6 12 Rental growth (quarter-on-quarter %) 3 10 0 8 Vacancy rate (%) -3 6 -6 4 -9 2 IPD rental growth CBRE vacancy rate -12 0 Q4 02 Q4 03 Q4 04 Q4 05 Q4 06 Q4 07 Q4 08 Q4 09 Q4 10 Q4 11 Q4 12 Source: CBRE, IPD 93
Slide 95: Appendix - Central London office rental growth
Appendix 22 - Central London office rental growth 30 20 Rental growth (% pa) 10 0 Q1 03 Q1 04 Q1 05 Q1 06 Q1 07 Q1 08 Q1 09 Q1 10 Q1 11 Q1 12 -10 -20 Central London -30 City West End -40 Source: CBRE 94
Slide 96: Appendix 23 - Current project programme map
Appendix 23 - Current project programme map Islington Camden Euston Thameslink Old Street Bloomsbury Clerkenwell 5 1 Fitzrovia 3 e 9 Farringdon Shoreditch Marylebone/ 8 Liverpool Street Paddington Baker Street North of Oxford St 6 Tottenham 7 Court Road 4 Holborn The City Paddington Bond Street Tham
Slide 97: Appendix 24 - Project pipeline
Appendix 24 - Project pipeline On-site 2013 Other consented Current Potential pipeline projects1 + starts + projects + appraisals = (by 2020) 0.5m 0.4m 0.9m 0.9m 2.7m sq ft 73 Charlotte St W1 Bishop’s Bridge Rd W2 1-5 Grosvenor Pl SW1 19-35 Baker Street W1 Current On-site and appraisal consented stu
Slide 98: Appendix 25 - Projects summary 2013-14
Appendix 25 - Projects summary 2013-14 Dec 2012 Pre Current net scheme Proposed 2013 2014 2015+ Total office income area area capex1 capex1 capex1,2 capex1 Delivery ERV £m pa ‘000 sq ft ‘000 sq ft £m £m £m £m date £psf On site at Dec 2012 Buckley Building EC1 2.5 75 85 3 - - 3 Q1 2013 c.45 1 Page St
Slide 99: Appendix 26 - Projects summary 2015+
Appendix 26 - Projects summary 2015+ Dec net Pre scheme Proposed Earliest income area area possession £m pa ‘000 sq ft ‘000 sq ft year Comment White Collar Factory EC1 0.8 124 289 2013 Consented - offices, capex c.£100m Jaeger House, Broadwick Street W1 0.8 25 c.30 2013 Appraisal studies Wedge House
Slide 100: Appendix 27 - Management structure - executive team
Appendix 27 - Management structure - executive team John Burns Chief Executive Officer Damian Wisniewski Finance Director Simon Silver Property Director Nigel George Property Director Paul Williams Property Director David Silverman Property Director Tim Kite Company Secretary Richard Baldwin Head of
Slide 101: Disclaimer
Disclaimer This presentation has been prepared by Derwent London plc (the apparent. Past performance is not indicative of future results and “Company”). No representation or warranty (express or implied) forward-looking statements are not guarantees of future performance. of any nature is given nor