News

Land Securities upbeat as values return to growth

Land Securities Lavington Street

Land Securities delivered positive annual results with EPRA net tangible assets (NTA) increasing 1.7% over the 12 months to 31 March 2025, as real estate values returned to growth.

The valuation of its portfolio was up 1.1% and is now worth £10.9bn. This reflected a return on equity of 6.4% and contributed to an EPRA NTA uplift of 1.7% to 874p per share.

The central London portfolio was up 1.0%, driven by strong 5.2% growth in ERVs, whilst valuation yields rose slightly. Developments were up 2.5% reflecting ERV growth and a de-risking of on-site schemes. The valuation of its major retail portfolio was up 3.4%, reflecting a combination of 4.0% ERV growth and 22 basis point yield compression.

EPRA earnings were up £3m to £374m, reflecting 5.0% like-for-like net rental income growth and lower overhead costs, which more than offset the impact from significant disposals in the year and a rise in finance costs.

EPRA earnings per share was up 0.4% to 50.3p. The company paid a total dividend of 40.4p, up 2.0%.

The group’s balance sheet remains robust, with a long average debt maturity of 9.6 years. Pro-forma for disposals since the year-end, its LTV is 38.4% and average net debt/EBITDA is 7.7 times. The weighted average cost of debt was 3.4% (2024: 3.3%).

The company said that it anticipates a 20% growth in EPRA earnings by 2030, with a 2%-4% growth expected in 2026.

Operational highlights

  • 5.0% like-for-like net rental income growth, ahead of guidance, with 8% rental uplifts on relettings/renewals in London and major retail, and continued strong leasing momentum since the year-end
  • Increased occupancy by 100 basis points to 97.2%, the highest level in five years
  • 4.2% ERV growth
  • Reduced overhead costs by 5%, with more than 10% further savings expected over 2026-27

Mark Allan, chief executive, commented:

“Our portfolio again delivered very strong performance with like-for-like net rental income growth of 5.0%, supporting growth in both earnings and portfolio valuation over the year. Owning the right real estate has never been more important and, with a very healthy pipeline of occupier demand, this trend looks set to continue, providing a clear trajectory for further near and medium-term EPS growth.

“Our undoubted portfolio quality is a result of proactive and successful capital recycling over recent years and this will continue to be a focus for us. Our capital allocation decisions from here are about ensuring that the growth outlook for our portfolio in 3-5 years’ time is as positive as it is for our current portfolio today. That is why we have set out a clear plan to increase investment in major retail by a further £1bn and establish a £2bn+ residential platform by 2030, to be funded by rotating £3bn of capital out of offices, non-core investments and low or non-yielding pre-development assets. Delivering on this strategy, whilst continuing to drive sustainable income and EPS growth, is our priority and we are firmly underway.

Richard Williams
Written By Richard Williams

Property Analyst

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