REG - Helical PLC - Trading Update

HelicalAnnouncement

14/10/2024 07:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20241014:nRSN9487Ha&default-theme=true

RNS Number : 9487H  Helical PLC  14 October 2024

 

HELICAL PLC

(“Helical” or the “Company”)

Trading Update for the Period Since 1 April 2024

14 October 2024

Helical today provides an update covering its trading activity for the period
1 April 2024 to 11 October 2024 ("the Period") in advance of its Half Year
results which will be announced on Tuesday 26 November 2024.

 

Commenting on the Company's activities, Matthew Bonning-Snook, Helical's new
Chief Executive, said:

 

"It has been a busy six months during which we have made good progress
delivering on the targets we set ourselves earlier this year.

 

"Construction is now underway on three new office schemes, with plans
progressing at the remaining future development sites. A new Revolving Credit
Facility is in place which pushes out our debt maturity, and proactive
management of our investment portfolio is reducing vacancy. We will continue
to recycle our portfolio, as market conditions allow, providing funds for our
future pipeline as well as containing our gearing levels.

 

"The market appears to be moving in our direction, with our best-in-class
office developments due to deliver into a supply constrained 2026."

 

Operational Performance

 

Development Pipeline - Under Construction

 

100 New Bridge Street, EC4 - Works have started on site for our "carbon
friendly" new office development at 100 New Bridge Street, EC4, located
adjacent to City Thameslink station and a short walk from Farringdon and
Blackfriars stations. In the Period, we signed a JV Agreement with Orion
Capital Managers, a £155m development facility agreement with NatWest and an
institutional lender, as well as the main building contract with Mace. Works
are progressing well with a planned completion date of April 2026.

 

Brettenham House, WC2 - The repositioning of this asset is now underway with
the building fully scaffolded to facilitate the commencement of the cleaning
and repair of the external stonework and new window installation. The
technical design stage is due to be concluded by the end of October with
completion of the works due by April 2026.

 

10 King William Street, EC4 - The first of three initial sites to be
developed in joint venture with Transport for London's property company,
Places for London, this eight storey office development located above the
recently opened Bank station entrance on Cannon Street will deliver 140,000 sq
ft of "best-in-class" office space with an additional 2,000 sq ft of ground
floor retail space. We secured consent in the Summer for the cycle, wellness
and public realm enhancements via a s96a amendment. On 1 October we acquired
the site and the basement construction works are now well underway. We are
finalising the placement of the main building contract and are aiming to
achieve practical completion of the scheme by December 2026.

 

Terms have been agreed for a four year, £125m development facility to fund
the construction works on 10 King William Street and are now in the process of
being legally documented in time for the start of the main contract works in
January 2025.

 

Development Pipeline - Future Schemes

 

Southwark OSD, SE1 - We submitted a planning application on 20 September 2024
to Southwark Borough Council, following extensive consultations through the
Spring and Summer. As the second site in our joint venture with Places for
London, the proposals comprise a purpose-built student accommodation scheme of
429 studio units together with a separate building providing on-site
affordable housing. Designed by AHMM, the new scheme sees a reduction in
height and massing compared to the previously consented office scheme, as well
as retaining and enhancing Joan Street as part of the significant improvements
to local biodiversity and urban greening. We are targeting an implementable
consent in time for the site purchase in July of next year.

 

Paddington OSD, W2 - Situated close to the Elizabeth Line station at
Paddington, this 19-storey building, the third development in our joint
venture with Places for London, will provide 235,000 sq ft of office space. In
the Period, a non-material amendment was approved introducing terrace amenity
to each of the office floors as well as rationalising the south transfer
structure to reduce embodied carbon and cost. We continue to look at
enhancements to the scheme with a particular focus on the end of trip
facilities and arrival experience. We are due to acquire the site, in the
joint venture, in January 2026.

 

Investment Portfolio

 

The JJ Mack Building, EC1

 

At The JJ Mack Building, EC1 we have let 44,103 sq ft of offices during the
Period along with 1,521 sq ft of retail, at 31 March 2024 ERVs, with 13,409 sq
ft of the let office space subject to fixed annual increases of 2.5%. These
lettings take the overall occupancy of the building to 90%, with the only
remaining space being the 21,734 sq ft fifth floor which benefits from a 1,298
sq ft private terrace.

 

The Bower, EC1

 

At The Tower, we have been working to let the space on the first to the sixth
floors, previously occupied by WeWork.

 

The Tower's flex offering, Beyond The Bower, has achieved a series of new
memberships which has brought the overall occupancy on the first floor to 28%
and the second floor to 92%. We are conducting a light refurbishment of the
third floor, released to us by WeWork in June this year, and have undertaken a
refit of the fourth, fifth and sixth floors. We have signed an agreement for
lease on the completed fourth floor, at rents slightly above 31 March 2024
ERV, to a US cyber security company. The works on the fifth and sixth floors
are due to complete later this month and good interest is being shown by
prospective occupiers.

 

The Loom, E1

 

We continue to make good progress in reducing the vacancy at The Loom, which
has reduced from 34.9% at 31 March 2024 to 27.4%. This represents a
combination of new tenants and upsizing of existing building occupiers.

 

Sales

 

On 25 April 2024, we completed on the sale of 25 Charterhouse Square, EC1, for
£43.5m, with contracts having exchanged on the 31 March 2024.

 

On 17 May 2024, we signed a joint venture agreement with Orion Capital
Managers, selling a 50% investment in 100 New Bridge Street, EC4 for £55m.

 

On 15 August 2024, we exchanged contracts for the sale of The Power House, W4,
for £7.0m.

 

 

Financing

 

£210m Revolving Credit facility ("RCF")

 

On 30 September 2024, we renewed the Group's RCF for a further three year term
with two one-year extensions and a revised facility amount of £210m, down
from £300m. Around the same time, we used the mark to market value of the
Group's existing interest rate swaps to enter into £175m of new four-year
interest rate swaps at an average rate of 1.58%. The amount drawn remains at
£188m with an all-in interest rate, including margin and utilisation fee, of
4.0% and an average maturity of 3.0 years, extendable to five years on
exercise of the two extension options.

 

100 New Bridge Street, EC4

 

As at 30 September 2024, in our joint venture, we had drawn £5.8m of the
£77.5m facility (our share) which has an effective interest rate, excluding
commitment fees, of 8.5%. The facility is repayable in 3.6 years, with a one
year extension option.

 

Sustainability

 

We continue to perform well against our sustainability goals and targets,
maintaining our Gold status from the EPRA Sustainability Best Practice
Recommendations and, more recently, we were pleased to receive a GRESB 5 star
rating across both our standing investments and development portfolio with a
score of 88/100 and 96/100 respectively. Most notably in the Period, we
received our design stage Outstanding BREEAM certification for 100 New Bridge
Street, EC4, achieving a score of 95.3%. Alongside this we also received our
WELL pre-certification and NABERS Design for Performance for the scheme. This
impressive result supports our continued commitment to drive sustainability
forward at all our developments and demonstrates what is possible when
sustainability is embedded as a key priority from the outset.

 

The refinanced RCF continues to be a Sustainability Linked Loan incorporating
ESG targets. These targets reflect the ambitions and trajectory of the
business including BREEAM certification and upfront embodied carbon.

 

 

 

For further information, please contact:

 

 Helical plc
 Matthew Bonning-Snook (CEO)  Address:       5 Hanover Square, London W1S 1HQ
 Tim Murphy (CFO)             Website:        www.helical.co.uk (http://www.helical.co.uk)

                              Tel:                 020 7629 0113

 FTI Consulting
 Dido Laurimore               Tel:                 020 3727 1000

 Richard Gotla

 Andrew Davis

Schelical@fticonsulting.com (mailto:Schelical@fticonsulting.com)

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTQFLFFZBLBFBD