Half-year results from SEGRO (SGRO) underline why US industrial real estate investment trust Prologis is keen to buy the European warehouse and data centre developer.
SEGRO, which last week said it was minded to accept an improved £14bn shares and cash offer from Prologis, lifted its interim dividend by 4.5% to 10.14p per share after reporting a 6.3% rise in pre-tax profits to £268m for the six months to 30 June.
Adjusted earnings per share grew by 6.6% to 19.3p supported by a 5.3% increase in like-for-like net rental income growth. The company secured £53m of new headline rent, up 71% from £31m a year ago, comprising of £27m of new leases and £26m from tenants signing up to its new developments.
Best of all, SEGRO believes it is on track to raise earnings per share to 50p by 2030 from 36.6p last year with its pipeline of new data centres. Its existing portfolio of industrial and logistics parks already offers the prospect of £157m additional income if rents rise to their estimated market value.
Chief executive David Sleath said: “SEGRO has delivered a strong set of results in the first half of 2026. We secured £53m of new headline rent and have a record pipeline of development projects under construction or in advanced negotiations, underpinned by improving occupier demand for high-quality, well-located industrial, logistics and data centre space.”
Prologis has until 12 August to firm up its latest offer.
Our view
Richard Williams, senior analyst at QuotedData, said: “Impressive uplift in new rents is a reminder that occupational fundamentals remain exceptionally strong, particularly for well-located logistics assets. Strong rental growth today feeds directly into future cash flow and asset values and raises the question of whether the £14bn bid fully reflects the embedded value of SEGRO’s development pipeline and growing data centre opportunity.”
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