Workspace Group upbeat as demand for flexible office space rises
Workspace Group rose as demand for flexible office space rises and prices rise despite transport strikes
- Workspace said customer demand was strong in the three months to March
- Like-for-like rent per square foot increased 2.7% during the quarter, the group reveals
Workspace Group saw customer demand sustained in the three months to March despite union action during the period, averaging 932 applications per month.
The FTSE 250 firm and office space specialist said it managed to convert that demand into new rentals in the fourth quarter, with 341 new rentals completed during the period, generating a total rental value of £8.3m per annum.
The group reported strong price momentum, with like-for-like rent per square foot up 2.7 per cent during the quarter and 9.4 per cent since March last year, to £40.61.
Q: Workspace Group claims that customer demand remained strong in the three months to March
The company’s like-for-like occupancy rate remained stable at 89.1 percent, down slightly from December’s 89.2 percent.
The like-for-like rental roll was up 1.2 per cent, or £1.2m, in the quarter and was up 7.2 per cent since March last year to £97.7m.
The group’s total rent increased by £2.2m, or 1.6 per cent, to £140.1m in the quarter.
The £54m sale of the residential component of the Riverside mixed-use redevelopment in Wandsworth was completed in March, in line with September’s valuation.
Workspace said its balance sheet remained “robust,” with a pro forma loan-to-value ratio of 32 percent based on the September 30 valuation, and an average maturity of borrowed debt of 4.1 years.
It added: “We saw strong demand in the fourth quarter despite the disruption caused by subway and rail strikes.”
Boss Graham Clemett, said: ‘We saw a strong fourth quarter of trading activity with customer demand enabling us to continue to raise our prices.
“This achievement reflects the continued appeal of our offering to the evolving needs of businesses looking for space.
‘We offer flexibility in terms of both rental length and space size at affordable prices in high quality, sustainable buildings in well-connected locations across London.’
Clemett added that while the current economic situation has been “challenging,” the group has a solid balance sheet, with most of its debt on long maturities.
He added: “This will continue to improve as we progress with the sale of non-core assets.
“Our distinctive offering, proven operational track record and ownership of an extensive footprint across London sets us apart from others in the growing market for flexible space.
‘All of this presents us with a great opportunity to achieve sustainable long-term growth.’
Workspace shares rose today, rising 0.22 percent, or 1.00p, to 460.40p in late morning trading.