They say, in their results statement, that the strong operating results are due to portfolio quality and operational focus. The report £38.4m of new rental income contracted during the year (compared to £42.7m in 2010), lettings completed at 1.7% above December 2010 ERVs, and an increased retention rate to 74% (2010: 63%).
The report their group vacancy rate reduced to 9.1% from 11.4% at the half year, and the vacancy rate in the former Brixton portfolio reduced to 13.4% (2010: 18.6%).
They have disposed of £110.9m of assets in 2011. Since the year-end they have sold five non-core (outside London/the South East) industrial estates to Ignis Asset Management for £80.2m. Further disposals are expected.
Commenting on the results and outlook, David Sleath, Chief Executive said: “We delivered strong income-generation and earnings growth, driven by an excellent operational performance which included further reducing our vacancy rate, significantly increasing customer retention and building a strong pipeline of future income from pre-let developments. We expect the macro environment to remain unsettled for some time to come, both in the UK and Continental Europe. However, we have started the new year with good momentum in our letting activity and our 20 mainly pre-let development projects underpin future rental income. We have a strong balance sheet and a clear focus to build on our strengths by investing in the strongest locations in resilient sectors, both in the UK and Continental Europe, and to recycle those assets which do not fit our strategic criteria. Given the strengths of our operational teams and core assets, we are well-positioned to continue to capitalise on demand for newly-developed and well-located industrial space from a diverse range of customers and industries.”
“As part of the revised strategy for the Group outlined on 8 November 2011, we have made a promising start to reshaping our portfolio with the completion since the year end of the acquisition of prime logistics assets with a joint venture partner and the disposal of a portfolio of non-core holdings in the UK.”