REG - Shaftesbury Capital - Final Results
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RNS Number : 2467U Shaftesbury Capital PLC 25 February 2026
PRESS RELEASE
SHAFTESBURY CAPITAL PLC ("THE COMPANY")
AUDITED PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2025
25 FEBRUARY 2026
DELIVERING SUSTAINED INCOME AND VALUE GROWTH
Ian Hawksworth, Chief Executive, commented:
"We are pleased to report another excellent year, delivering growth in rental income, earnings, dividends, property valuation and net tangible assets per share. Our West End estates continue to perform, with vibrant destinations supported by high occupancy, footfall and customer sales. Leasing demand remains strong, with 434 transactions completed during the year at 10 per cent ahead of December 2024 ERV. Portfolio valuations increased by 6.6 per cent and we enter 2026 with a strong leasing pipeline across our destinations.
The investment in Covent Garden by a leading global real estate investor, NBIM, further underlines the quality and long-term appeal of our portfolio. With enhanced liquidity and a strong balance sheet, we are well-positioned to pursue accretive opportunities and grow assets under management."
Highlights
· EPRA NTA increased by 7.2 per cent to 214.7 pence per share
delivering total accounting return of 9.1 per cent
· Portfolio valuation increased by 6.6 per cent like-for-like to £5.4
billion, supported by a 6.2 per cent like-for-like increase in ERV to £270
million
· Underlying earnings improved 12 per cent to 4.5 pence per share and
dividends increased by 14 per cent to 4.0 pence per share
· 434 leasing transactions, representing £39 million of contracted
rent, 10.3 per cent ahead of December 2024 ERV and 13.9 per cent ahead of
previous passing rents
· High occupancy: 2.6 per cent of ERV available to let, with positive
start to 2026 with strong footfall and customer sales
· Portfolio investment through £113.3 million of capital expenditure
and acquisitions providing excellent asset management and rental growth
opportunities
· Completion of long-term partnership with Norges Bank Investment
Management ("NBIM") in respect of the Covent Garden estate
· Well-positioned for growth, expansion and investment with a strong
balance sheet, access to significant liquidity and low leverage
Presentation of information
The property level information set out within the annual results, including
valuation and rental data, reflects the portfolio under management at 100 per
cent. Further information on the Group share, reflecting the Covent Garden
estate at 75 per cent ownership, following the long-term partnership with
NBIM, is set out on page 48. The Group financial statements are prepared under
IFRS whereby the Group fully consolidates the Covent Garden estate, reporting
NBIM's 25 per cent interest in Covent Garden as a non-controlling interest.
Key financials
As at As at
31 December 31 December
2025 2024
Total equity attributable to owners of the Parent £3,954.2m £3,674.3m
IFRS total equity per share(1) 214.6p 200.4p
EPRA net tangible assets(1) £3,954.9m £3,671.1m
EPRA net tangible assets per share(1) 214.7p 200.2p
Market value of property portfolio under management(2) £5,407.1m £4,973.5m
Like-for-like property valuation movement +6.6% +4.5%
Like-for-like ERV growth +6.2% +7.7%
Market value of property portfolio (Group share)(2) £4,700.7m £4,973.5m
Net debt £813.3m £1,405.0m
EPRA LTV 16.8% 27.4%
Net debt to EBITDA 6.6x 10.9x
1. Refer to note 3 'Performance Measures'.
2. Refer to note 10 'Property Portfolio'
Year ended Year ended
31 December 31 December
2025 2024
Profit for the year attributable to owners of the Parent(1) £340.2m £252.1m
JSE headline earnings per share(2) 3.3p 3.4p
Underlying earnings per share(2) 4.5p 4.0p
Dividend per share(3) 4.0p 3.5p
Total property return 10.1% 7.6%
Total accounting return 9.1% 7.0%
Total shareholder return 18.6% (6.9%)
1. Refer to the 'Consolidated Income Statement'.
2. Refer to note 3 'Performance Measures'
3. Refer to note 9 'Dividends'
Refer to Glossary of terms.
Enquiries:
Shaftesbury Capital PLC +44 (0)20 3214 9150
Ian Hawksworth Chief Executive
Situl Jobanputra Chief Financial Officer
Sarah Corbett Director of Commercial Finance and Investor Relations
Media enquiries:
UK: Hudson Sandler Michael Sandler +44 (0)20 7796 4133
UK: RMS Partners Simon Courtenay +44 (0)20 3735 6551
SA: Narrate Rachel Quigley +27 (0)11 447 3030
A presentation to analysts and investors will take place today at 09:30am (UK
time) at the offices of Peel Hunt LLP, 100 Liverpool Street, London, EC2M 2AT.
The presentation will also be available to analysts and investors through a
live audio call and webcast and after the event on the Group's website at
www.shaftesburycapital.com.
A copy of this announcement is available for download from our website at
www.shaftesburycapital.com (http://www.shaftesburycapital.com) .
About Shaftesbury Capital
Shaftesbury Capital PLC ("Shaftesbury Capital") is the leading central London
mixed-use REIT and is a constituent of the FTSE-250 Index. Our property
portfolio under management, valued at £5.4 billion, extends to 2.8 million
square feet of lettable space across the most vibrant areas of London's West
End. With a diverse mix of shops, restaurants, cafés, bars, residential
apartments and offices, our destinations include the high footfall, thriving
neighbourhoods of Covent Garden, Carnaby, Soho and Chinatown. Our properties
are close to the main West End Underground stations and transport hubs for the
Elizabeth Line. Shaftesbury Capital shares are listed on the London Stock
Exchange ("LSE") (primary) and the Johannesburg Stock Exchange ("JSE")
(secondary) and the A2X (secondary).
Our purpose
Investing to create thriving destinations in London's West End where people
enjoy visiting, working, and living.
Our values
We have a set of values that are fundamental to our behaviour, decision making
and the delivery both of our purpose and strategy: Act with integrity; Take a
creative approach; Listen and collaborate; Take a responsible, long-term view;
and Make a difference.
CHIEF EXECUTIVE STATEMENT
Overview
We are pleased to report another excellent year with growth in rental income,
earnings, dividends, property valuation and net tangible assets per share. Our
West End estates are busy and vibrant, with high occupancy, footfall and
customer sales. Our customers recognise the exceptional features of our
actively managed portfolio which has broad appeal to domestic and
international consumers. We start 2026 with a strong leasing pipeline and
repositioning opportunities across the portfolio that support our long-term
growth prospects.
The independent valuation of properties under management increased by 6.6 per
cent, resulting in 14.5 pence increase in EPRA NTA per share to 214.7 pence
per share. We continue to deliver rental income growth and cost efficiencies,
resulting in a 12.2 per cent increase in underlying earnings and 14.3 per cent
growth in dividends.
In April 2025, we established a long-term partnership with Norges Bank
Investment Management ("NBIM") which acquired a 25 per cent non-controlling
interest in the Covent Garden estate, in line with the December 2024
valuation. The partnership brings together two long-term investors with a
shared confidence in and ambitions for the growth prospects of the Covent
Garden estate and the West End.
With our strong performance, pipeline, balance sheet and liquidity position,
we are well-positioned to deliver attractive total accounting returns.
Strength of demand for our unique West End portfolio
As one of the largest property owners in London's West End, we play an
important role in shaping the area's long-term future. Our iconic portfolio
provides world-class retail, food & beverage, office and residential
space, supporting London's position as a leading global destination.
London's rich cultural offering, strong transport links, globally-recognised
educational hub and innovative business environment continue to underpin its
global appeal. The West End remains a thriving hub for culture, retail,
dining, leisure and entertainment. With limited new supply and consistently
high demand for prime space, the fundamentals of the West End market are
supportive of sustainable long-term rental growth.
Leasing demand is strong, with prime West End locations widely regarded as an
essential "shop window" for global brands. Our portfolio continues to benefit
from active asset management and curation, ensuring our locations remain
vibrant, distinctive and well-positioned to capture customer demand. Hotel
occupancy in the West End remains high, while the Elizabeth Line continues to
broaden catchment for visitors and workers alike.
There is significant growth potential and rental reversion across each of our
locations. Footfall and sales continue to strengthen, reflecting consumer
confidence and underpinning leasing activity. 2025 has been a positive year,
with demand remaining resilient despite uncertainty arising from higher
employment costs and ongoing geopolitical and macroeconomic volatility.
We have made significant progress and remain confident and excited about the
prospects for each of our destinations. We are generating rental income growth
through our asset management activities. The benefit of unifying the Covent
Garden district including the Piazza and surrounding streets, together with
Seven Dials, through leasing, asset management and marketing activities is
clear. The changes implemented across Seven Dials over the past three years
have delivered 32 per cent rental growth with continued leasing demand,
reinforcing consumer interest in the wider Covent Garden area.
The evolution of Carnaby Street has moved forward, with 19 new concepts
introduced this year, with brand and category selection designed to address
the evolving needs of our customers and consumers. We have undertaken initial
engagement on public realm enhancements, including streetscape, lighting and
wayfinding, which are expected to commence later this year while carefully
preserving Carnaby Street's distinctive character and heritage.
In Chinatown we are continuing to introduce more variety and new concepts to
the area, increasing the pan-Asian offering at a range of price points, whilst
preserving the character of the area. This is delivering good rental growth
with ERVs up 18 per cent since 2022.
Active investment market
The West End investment market is very active for smaller lot sizes. Property
yields are stable, with marginal yield compression observed across certain
properties, supported by transactional evidence from a broad range of
investors including in many cases owner-occupiers. There is now also enhanced
appetite for larger lot sizes with lower interest rates contributing to
improved liquidity conditions.
The formation of the long-term partnership on Covent Garden with NBIM, a
leading global real estate investor, demonstrates the quality of our
portfolio. Through partnering with private capital, we leveraged our operating
expertise and assets, enhancing growth and expansion opportunities across our
portfolio whilst strengthening our financial position and providing
significant optionality to the Group.
We remain disciplined in our approach to capital allocation and continue to
look at opportunities to expand selectively, adding to our growth prospects,
ensuring that we deploy resources to enhance the overall portfolio and
generate long-term value for shareholders. Over the past three years,
Shaftesbury Capital has deployed £278 million of capital through acquisitions
and capital expenditure and generated proceeds of £1 billion from disposals
in line with valuation. We assess the merits of all capital decisions
including investment in our portfolio and repositioning opportunities,
accretive acquisitions, the disposal of non-strategic assets and the return of
surplus capital to shareholders as appropriate.
We continue to deliver capital initiatives, particularly across Covent Garden
and Carnaby | Soho. This year, we invested £113.3 million in our portfolio,
comprising £33.1 million in capital expenditure and £80.2 million in
targeted acquisitions. These acquisitions present attractive asset management
opportunities with rental growth potential. We continue to invest where
appropriate, with an encouraging pipeline of acquisition opportunities
currently under review.
Significant growth in earnings, dividends and valuation
Our prime West End portfolio is anticipated to continue to deliver long-term
sustained total returns. NTA increased by 7.2 per cent over the year to 214.7
pence per share. Annualised gross income increased by 5.3 per cent
(like-for-like) to £215.0 million from leasing activity and asset management
initiatives. ERV increased by 6.2 per cent (like-for-like) to £270.3 million,
reflecting favourable supply-demand dynamics in our markets for high-quality
real estate with only 2.6 per cent of portfolio ERV available to let. 434
leasing transactions completed during the year, 10.3 per cent ahead of
December 2024 ERV and 13.9 per cent ahead of previous passing rents. Total
property return for the year was 10.1 per cent, significantly ahead of the
MSCI Total Return Index which recorded 7.1 per cent.
Cost savings continue to be identified and implemented across the business.
Current initiatives include supplier consolidation across portfolio
operations, such as security, cleaning, facility management and property
management, which are anticipated to generate efficiencies and enhance
customer service. Underlying administration costs were £33.3 million
excluding the share award charge, reflecting an 8 per cent reduction relative
to 2024. Underlying earnings increased by 12.2 per cent to £81.9 million,
equivalent to 4.5 pence per share and the Board has proposed a final dividend
of 2.1 pence per share taking the total dividend for the year to 4.0 pence per
share, up 14.3 per cent over the year, reflecting the progression in
underlying and cash earnings. Total accounting return for the year was 9.1 per
cent.
We maintain a strong balance sheet with a focus on resilience, flexibility and
efficiency. Net debt to EBITDA is 6.6 times, EPRA LTV is 17 per cent and the
interest cover ratio is 4.0 times, with substantial headroom against debt
covenants. The Group has access to significant liquidity ensuring it is
well-positioned to act on market opportunities.
Prime portfolio positioned for long-term growth
Operational performance continues to be strong and there is a specific plan
for each estate and the connections between them to deliver growth from the
portfolio. With limited new supply and strong demand, the prospects for rental
growth are positive, with leasing activity completed well ahead of previous
passing rents and ERV. We are improving the quality of our offer via letting
activity which enhances our customer mix.
Market rent (as represented by ERV) for the portfolio is 26 per cent higher
than current passing rent, resulting in significant upside potential in rental
income through leasing and asset management activity. The portfolio remains
virtually full at 97 per cent occupancy. Based on our consumer data and
experience, average spend and dwell time have the potential to be
significantly higher in areas of our portfolio, with mix, category and brand
selection designed to generate higher productivity which should support rental
growth.
We place the customer at the heart of our business, delivering high-quality
service, while creating vibrant, differentiated experiences for visitors,
workers and residents. Our approach focuses on building and maintaining close
customer relationships together with our partners. Customer retention remains
a strength, underpinned by consistently high renewal rates and trusted
partnerships with our customers. The scale and depth of the portfolio provide
opportunities to support the growth of our customers with numerous examples of
customers having upsized or expanded across the portfolio in recent years.
This year we launched a Customer Satisfaction Survey which included customer
interviews and was very well received. We have now rolled out our customer
connection portal, allowing more frequent engagement.
Our marketing programme continues to focus on the consumer calendar,
supporting footfall and sales prospects in our destinations. Our digital
channels continue to grow, extending our reach and providing marketing
opportunities with customers and partners. Activations and events provide
further collaboration opportunities with brands across our portfolio providing
ancillary revenue opportunities whilst benefiting stakeholders across the
wider West End.
Commitment to environmental stewardship
Our Sustainability Strategy is founded in future-proofing our heritage
buildings and creating sustainable and healthy places where people enjoy
visiting, working and living. Throughout 2025, we continued to reduce the
environmental impact of our operations. We have ambitious targets to
decarbonise, reduce energy use and deliver positive environmental, social and
economic impact.
We continue to work towards our aim to be a leader in sustainable heritage
buildings and are proud to be included in the Financial Times list of Europe's
Climate Leaders 2025. We are committed to meeting our 2030 carbon reduction
targets and have reset our Net Zero Carbon target to 2040. We have already
made great progress in reducing our carbon emissions and, working with our
customers, will continue to decarbonise by replacing gas with electricity
where practical to do so. As we look ahead, we will utilise technology and
innovation to enhance our sustainability activities and work closely with
customers and our stakeholders to deliver shared sustainability goals.
Our scale allows us to shape not only buildings, but also the spaces around
them. We are working with local stakeholders to enhance the public realm
across our destinations, making them greener and more enjoyable for everyone.
Covent Garden's Henrietta Street public realm is currently being improved,
with completion expected by the end of 2026, delivering wider, more accessible
pavements and enhanced al fresco dining with greening. We are also undertaking
early engagement on improvements to Carnaby Street to enhance the experience
while preserving the area's unique character.
Active community engagement
As a responsible long-term investor, community engagement and collaboration
are important to us. We recognise the importance of fostering relationships
within the communities that help make our places thrive. Our community
programme prioritises initiatives and charitable partnerships within
Westminster and Camden, and includes financial contributions, provision of
space and employee volunteering.
In 2025, we published our first Community Impact Report highlighting our
contribution and the valuable work of community partners. In addition, we
commenced our three-year community strategy, prioritising support for local
people into employment as the area with the greatest potential to deliver
lasting impact through partnerships across a range of charitable and community
initiatives.
Our people, values and culture
Our people are one of our competitive strengths and critical to our success.
We provide a collaborative environment where people are inspired to give their
best and contribute to the Company's success. During the year, Shaftesbury
Capital carried out a second employee survey, with a very high participation
rate of 90 per cent and an overall engagement score of 84 per cent, ahead of
the global benchmark. Overall, the employee feedback received was positive,
reflecting strong levels of pride and commitment across the organisation. We
thank our employees for taking part in the survey and for their commitment
during the year.
We have a very experienced leadership team as well as a breadth of talent
across the Group. At the end of the year, two valued colleagues, Michelle
McGrath and Andrew Price, stepped down from the business and we thank them for
their contribution over many years. Following this, a number of the senior
leadership team have taken on greater responsibility in Asset Management,
Leasing, Marketing and Investment reporting directly to the Chief Executive
and Chief Financial Officer.
We are proud to be named Britain's Most Admired Company 2025 in the Property /
Residential & Commercial REITs sector which is an endorsement of our
strategy and our people. We continue to invest in our people and have
introduced a number of initiatives to support our colleagues, providing
greater development opportunities.
Outlook
Our growth prospects are underpinned by strong fundamentals. The West End
market has delivered attractive, predictable growth over the long-term with
annualised rental growth of approximately 4 per cent. Our strategy is to
deliver consistent, long-term rental growth generating attractive
risk-adjusted returns, earnings and valuation progression. The West End market
is characterised by consistently high occupancy, scarcity value and limited
new supply. We continue to actively rotate capital into core locations and
prime streets, supported by selective capital investment. Our forward-looking
customer and consumer focus, including optimising use, category and brand mix,
is designed to enhance productivity and value. There are benefits of scale
through aggregation, improved public realm and greater use of data continue to
support sustainable growth. These strong fundamentals and our active approach
have enabled us to outperform.
Despite ongoing macroeconomic and geopolitical uncertainty, the West End
continues to perform well, with high footfall, sales growth, limited vacancy
and a strong leasing pipeline. The investment in Covent Garden by a leading
global real estate investor, NBIM, underlines the quality of our portfolio.
With enhanced liquidity and a strong balance sheet, we are well-positioned to
pursue accretive opportunities and grow assets under management.
We are confident in delivering our medium-term target rental growth of 5 to 7
per cent, which, alongside stable yields, supports total property returns of 7
to 9 per cent and total accounting returns of 8 to 10 per cent per annum.
Through active management of our prime West End portfolio and the strength of
our operating platform, we are focused on sustained long-term growth in rental
income, earnings, dividends and property valuation.
Ian Hawksworth
Chief Executive
24 February 2026
OPERATING AND PORTFOLIO REVIEW
Overview
Shaftesbury Capital owns and manages an impossible-to-replicate portfolio that
extends to 2.8 million square feet of lettable space across the most vibrant
areas of London's West End. The Group's portfolio of adaptable mixed-use
buildings provides diversified income streams with a long history of occupier
demand exceeding availability of space. With a broad mix of shops,
restaurants, cafés, bars, apartments and offices, our destinations include
the high-footfall, thriving neighbourhoods of Covent Garden, Carnaby Street,
Soho and Chinatown. Our properties are located at the heart of the West End's
entertainment and cultural attractions, benefitting from excellent
connectivity through close proximity to the main West End Underground and
train stations together with transport hubs for the Elizabeth Line. These
locations are characterised by high occupancy, low capital requirements and
reliable, growing long-term cash flows.
Fundamentals supportive of rental growth
There is significant rental growth potential for each of our locations with
embedded reversion in the portfolio of over 600 buildings. 434 leasing
transactions completed during the year, 10.3 per cent ahead of December 2024
ERV, in turn delivering 6.2 per cent ERV growth over the year. Annualised
gross income increased by 5.3 per cent (like-for-like) to £215 million. The
valuation of the property portfolio under management increased by 6.6 per cent
(like-for-like) to £5.4 billion.
· Market rent (as represented by ERV) for the portfolio is 26 per
cent higher than current passing rent, resulting in significant upside
potential in rental income through leasing and asset management activity.
Customer sales in aggregate are approximately 30 per cent ahead of
pre-pandemic levels, while retail ERVs are only marginally ahead of 2019
levels, both in nominal terms.
· Based on our consumer data and experience, average spend and
dwell time have the potential to be significantly higher in areas of our
portfolio, with our mix, category and brand selection designed to generate
higher productivity which should be supportive of rental growth over time.
· With a weighted average term to lease expiry or break of five
years, approximately 20 per cent of the portfolio ERV re-prices annually,
providing consistent opportunities to capture rental uplifts and align leases
with prevailing market rates.
Our approach and aggregated ownership of estates enables us to deliver rental
growth whilst establishing new rental tones, the benefit of which is often
compounded across nearby buildings. Our focus is on converting the portfolio's
reversionary potential into contracted income and cash flow. Total reversion
is £55.3 million, with approximately two-thirds represented by the retail and
F&B portfolio. 2025 retail and F&B new leases and renewals transacted
22 per cent ahead of previous passing rents with a strong leasing pipeline.
Components of the reversion under management (1)
31 December 31 December
2025 2024
£m £m
Annualised gross income 215.0 202.8
Contracted (includes rent-free periods and contractual rent increases) 15.6 14.9
Under offer 4.0 3.0
Available-to-let 6.8 6.3
Under refurbishment 11.3 13.5
Net under-rented 17.6 10.1
ERV 270.3 250.6
1. Represents portfolio under management, at 100 per cent ownership.
Disciplined capital allocation
We continue to deliver a range of refurbishments demonstrating our ability to
drive significant performance improvements, unlocking income and value through
active asset management.
Our investment activity is focused on Covent Garden, Carnaby | Soho and
Chinatown. We maintain a targeted approach and look for opportunities to
expand, adding to our growth prospects. Ongoing asset management initiatives
continue across Covent Garden and Carnaby | Soho in particular. During the
year, £113.3 million has been invested in our portfolio, comprising £33.1
million in capital expenditure and £80.2 million (before costs) in targeted
acquisitions in Covent Garden and Soho, presenting asset management
opportunities with excellent rental growth prospects. The pipeline of
acquisitions is encouraging, with a number of buildings currently under
review. Three properties, including the last remaining Fitzrovia assets, have
been disposed of during the year for gross proceeds of £12.4 million, in line
with the 31 December 2024 valuation.
Capital commitments totalled £10.8 million as of 31 December 2025. On
average, approximately 1 per cent of portfolio value is invested annually in
refurbishment, asset management, and repositioning initiatives, including
measures to improve energy performance.
Delivering valuation growth
The valuation of the property portfolio under management increased by 6.6 per
cent on a like-for-like basis to £5.4 billion, equivalent to approximately
£1,962 per square foot on average (Dec 2024: £1,833 per square foot).
The valuation gain has been driven by leasing and asset management activity.
Leasing activity was on average 10.3 per cent ahead of December 2024 ERV,
resulting in an overall increase in portfolio ERV of 6.2 per cent
(like-for-like) to £270.3 million (Dec 2024: £250.6 million). The equivalent
yield moved inwards marginally by 2 basis points to 4.43 per cent, whilst the
portfolio net initial yield is 3.6 per cent and topped-up net initial yield
(allowing for the expiry of rent-free periods) is 3.9 per cent. The equivalent
yield for the commercial portfolio (excluding residential) is 4.6 per cent.
Total property return for the year was 10.1 per cent, outperforming the MSCI
Total Return Index which recorded 7.1 per cent.
Prime West End property yields are stable, and certain properties have seen
marginal yield compression, supported by occupational and investment
transactional evidence demonstrating demand for high-quality, prime central
London real estate, from both international and domestic investors. There is
renewed appetite for larger lot sizes with lower interest rates contributing
to improved liquidity conditions. There is also growing demand for London
retail investments with owner-occupiers continuing to acquire.
Retail properties, which represent 36 per cent of the portfolio, performed
particularly strongly with ERVs up 8.1 per cent and valuations 10.4 per cent
higher.
Covent Garden generated ERV growth of 5.6 per cent through leasing and asset
management activity across the retail and food & beverage space, with 196
leasing transactions signed 9.6 per cent ahead of ERV. Across Carnaby | Soho,
ERV growth was 7.5 per cent during the year, as a result of 164 new leases and
renewals agreed 9.8 per cent ahead of ERV, primarily driven by retail lettings
and asset management activity. During the year, 74 new leases and renewals
were agreed in Chinatown, 13.9 per cent ahead of ERV. ERV growth in Chinatown
was 5.5 per cent over the year, driven by food & beverage letting
activity.
Portfolio by use for year ended 31 December 2025 Retail Food & Offices Total Residential Portfolio under management Portfolio on a Group share basis
beverage commercial
Valuation (£m)(1) 1,977.6 1,782.0 1,006.8 4,766.4 638.8 5,405.2 4,698.8
Valuation (%) 36% 33% 19% 88% 12% 100% 100%
L-f-L valuation movement (FY 2025) +10.4% +5.8% +5.6% +7.6% -0.6% +6.6% +6.7%
L-f-L valuation movement (H2 2025) +5.8% +2.8% +2.5% +4.0% -0.3% +3.4% +3.5%
Annualised gross income (£m) 75.8 76.4 39.0 191.2 23.8 215.0 187.6
Annualised gross income (%) 35% 36% 18% 89% 11% 100% 100%
L-f-L annualised gross income movement (FY 2025) +3.2% +5.0% +12.0% +5.6% +3.2% +5.3% +5.4%
L-f-L annualised gross income movement (H2 2025) +3.4% +3.4% +2.5% +3.2% +2.0% +3.1% +2.9%
ERV (£m) 97.9 89.3 57.1 244.3 26.0 270.3 234.8
ERV (%) 36% 33% 21% 90% 10% 100% 100%
ERV psf (£) 137 95 83 104 62 98 98
L-f-L ERV movement (FY 2025) +8.1% +4.9% +5.8% +6.4% +4.4% +6.2% +6.3%
L-f-L ERV movement (H2 2025) +4.7% +2.3% +1.6% +3.1% +2.2% +3.0% +3.0%
Net initial yield 3.6% 3.9% 3.4% 3.7% 3.0% 3.6% 3.6%
Topped up net initial yield 3.8% 4.2% 3.8% 3.9% N/A 3.9% 3.9%
Equivalent yield 4.5% 4.6% 4.8% 4.6% 3.3% 4.4% 4.4%
WAULT (years) 3.1 8.1 2.7 4.8 N/A 4.8 4.8(3)
Floor Area (sq ft m)(2) 0.8 0.9 0.7 2.4 0.4 2.8 2.8(3)
Unit Count(2) 419 392 436 1,247 659 1,906 1,906(3)
1. Excludes £1.9 million of Group properties primarily held in Lillie
Square LP Limited (a wholly-owned subsidiary).
2. Excluding long-leasehold residential interests.
3. WAULT, floor area and unit count have not been adjusted and reflect 100
per cent of the portfolio.
Portfolio by location for year ended 31 December 2025 Covent Garden Carnaby | Soho Chinatown Portfolio under management Portfolio on a Group share basis
Valuation (£m)(1) 2,825.5 1,816.9 762.8 5,405.2 4,698.8
Valuation (%) 52% 34% 14% 100% 100%
L-f-L valuation movement (FY 2025) +5.5% +8.5% +6.4% +6.6% +6.7%
L-f-L valuation movement (H2 2025) +2.7% +4.8% +3.1% +3.4% +3.5%
Annualised gross income (£m) 109.5 72.2 33.3 215.0 187.6
Annualised gross income (%) 51% 34% 15% 100% 100%
L-f-L annualised gross income movement (FY 2025) +4.8% +6.8% +4.0% +5.3% +5.4%
L-f-L annualised gross income movement (H2 2025) +4.2% +2.0% +1.9% +3.1% +2.9%
ERV (£m) 142.1 91.9 36.3 270.3 234.8
ERV (%) 53% 34% 13% 100% 100%
ERV psf (£) 102 99 86 98 98
L-f-L ERV movement (FY 2025) +5.6% +7.5% +5.5% +6.2% +6.3%
L-f-L ERV movement (H2 2025) +3.3% +2.9% +2.2% +3.0% +3.0%
Net initial yield 3.5% 3.5% 3.9% 3.6% 3.6%
Topped up net initial yield 3.9% 3.8% 4.3% 3.9% 3.9%
Equivalent yield 4.5% 4.4% 4.2% 4.4% 4.4%
WAULT (years) 4.8 4.1 6.5 4.8 4.8(3)
Floor Area (sq ft m)(2) 1.5 0.9 0.4 2.8 2.8(3)
Unit Count(2) 854 702 350 1,906 1,906(3)
1. Excludes £1.9 million of Group properties primarily held in Lillie
Square LP Limited (a wholly-owned subsidiary).
2. Excluding long-leasehold residential interests.
3. WAULT, floor area and unit count have not been adjusted and reflect 100
per cent of the portfolio.
Independent valuations of the portfolio under management have been undertaken
in accordance with Royal Institution of Chartered Surveyors guidelines by CBRE
and Cushman & Wakefield. The valuations represent the aggregated value of
predominantly freehold properties. There is no reflection of any premium or
discount which some potential investors may ascribe to the comprehensive
ownership of a combination of some, or all, parts of the portfolio.
Excellent leasing activity
The portfolio under management represents 2.8 million square feet of lettable
space, comprising 1.7 million square feet of retail and food & beverage
space together with 0.7 million square feet of offices and 659 residential
apartments.
During the year, 434 leasing transactions were concluded with a combined
rental value of £38.8 million, comprising:
· 149 commercial lettings and renewals: £27.9 million, 11.9 per
cent ahead of 31 December 2024 ERV and 20.1 per cent ahead of previous passing
rents; and
· 285 residential lettings: £10.9 million, 6.4 per cent ahead of
31 December 2024 ERV and 3.9 per cent ahead of previous passing rents
In addition, 56 commercial rent reviews with a rental value of £14.1 million
were concluded on average 7.7 per cent ahead of previous passing rents.
Leasing transactions across the portfolio by use concluded during the year
New contracted rent % above % above previous passing rent
Use Transactions £m Dec-2024
ERV
Retail 66 13.1 11.8 18.7
Food & beverage 37 8.7 15.7 27.3
Offices 46 6.1 7.2 11.1
Residential 285 10.9 6.4 3.9
Total 434 38.8 10.3 13.9
Leasing transactions by destination concluded during the year
New contracted rent % above % above previous passing rent
Destination £m Dec-2024
Transactions ERV
Covent Garden 196 18.3 9.6 17.8
Carnaby | Soho 164 14.2 9.8 9.9
Chinatown 74 6.3 13.9 11.6
Total 434 38.8 10.3 13.9
Retail (36 per cent of the property portfolio under management value)
Demand for West End retail is excellent, with brands placing considerable
value on locations that combine high footfall, culture and a diverse consumer
base. Scarcity continues to support rental tones with availability on many of
our streets at or near record lows, driving competitive tension. Our districts
benefit from a seven-days-a-week trading environment, supported by strong
tourism levels. Trading conditions have been generally positive, with strong
performance in luxury, premium, fashion and lifestyle categories. The
portfolio now comprises over 400 shops with an average ERV of £137 per square
foot, across a range of rental tones. Units continue to attract multiple
interested parties and supporting uplifts in rents through new lettings and
renewals.
Our estates are attractive for both global brands entering or expanding in the
UK and home-grown operators. During the year, there were 30 new retail
openings across the portfolio, with customers continuing to choose our
portfolio to expand their operations. There have been a number of successful
openings across Covent Garden including Nespresso and Dolce & Gabbana.
Leading performance brand Saucony opened on James Street joining Swatch, which
relocated to a larger unit. Recent additions such as Matiere Premiere, Byredo
and Parfums de Marly reinforced the district's appeal for lifestyle and
experiential retail. A number of high-quality brands have been added to Seven
Dials including luxury activewear brand Alo Yoga, Swedish outdoor specialist
Thule and German lifestyle brand Kapten & Son, all of which have opened on
Neal Street.
Soho and Carnaby Street continue to attract an exciting mix of brands,
including Tala, Farm Rio and Pure Seoul. Luxury beauty brand Charlotte Tilbury
has opened a brand-new store at the key entrance to Carnaby Street, following
the success of its Covent Garden flagship. MAC Cosmetics has launched a new
experience-led concept as part of a relocation on Carnaby Street, emulating
the vibrancy of Soho's nightlife. US fashion brand Edikted will open its
European debut store, its first location outside the US. Global beauty
retailer Sephora has also taken space on Carnaby Street and is due to open
later this year. French-Swedish menswear brand Ron Dorff will launch a new UK
flagship store in Soho later this year, relocating from Covent Garden.
Reflecting demand during the year, 66 lettings and renewals were completed,
securing a rental value of £13.1 million, at an average of 11.8 per cent
above December 2024 ERV and 18.7 per cent ahead of previous passing rents.
A total of 20 retail rent reviews, with a rental value of £3.3 million, were
concluded at an average uplift of 13.1 per cent on previous passing rents.
Food & beverage (33 per cent of the property portfolio under management
value)
Our West End F&B portfolio welcomed 24 new dining concepts, reflecting the
continued appeal of our districts to both independent operators and
international entrants. The new arrivals span a range of cuisines, formats and
price points, offering a wide variety of experiences across our predominantly
pedestrian-centric destinations. The food & beverage portfolio extends to
nearly 400 units. There were a small number of failures and sales moderated in
certain restaurants in H1 2025; however trading levels improved in the second
half, with particularly strong performance from bars and differentiated
restaurants. Going out remains a priority for consumers with prime areas in
demand. Health-conscious menus and wellness-led concepts continue to see
strong consumer interest. Leasing demand has resulted in available space being
filled quickly with just 0.5 per cent of the F&B portfolio available to
let.
In Covent Garden, Harry's Bar opened a new Italian concept overlooking the
Piazza, while Buvette, the celebrated gastrothèque by chef Jody Williams,
will open in Neal's Yard this summer, offering a day-to-night dining concept.
High-quality Italian dining concept, Burro, will open its first location in
Floral Court in the coming months, with al fresco seating in the courtyard.
Inception Group, the operator of unique hospitality concepts across London,
will open a new flagship Mr Fogg's Tavern in the Market Building. The all-day
dining offer has been supported by the arrivals of Qima Café, Copain, Hagen
and St. JOHN Neal's Yard Bakery and Bar. Neal's Yard will welcome Kricket, and
ADOH! has opened on Maiden Lane, led by the team behind the highly regarded
Kolomba. The operators of Ergon House are set to open its Greek-inspired
boutique hotel-and-dining experience on King Street later this year.
There continues to be strong performance from our Soho portfolio. Founder-led
Soho restaurant Heard opened on Foubert's Place, alongside pizza and natural
wine concept Ria's, joined by French-inspired restaurant and wine bar
Marjorie's. Breadstall Pizza, which takes the best elements from both New York
and Neapolitan-style pizzas, opened on Berwick Street. Northern
Spanish-inspired ALTA opened in Kingly Court over two floors with an outdoor
terrace and Soho icon The Shaston Arms relaunched under new management.
Italian restaurant, Padella, signed to Kingly Street, a milestone for the
brand as its first in the West End. Pioneering Indian restaurant, Darjeeling
Express, will relocate from Kingly Court to a larger space on Rupert Street
joining the likes of The Palomar and Speedboat Bar.
Chinatown continues to attract strong interest from operators looking to
establish a presence in one of the West End's most distinctive, high-footfall
dining destinations. Both local and international restaurateurs regard the
district as a preferred location, benefiting from its high footfall, loyal
customer base and unique cultural resonance. Interest in Chinatown, especially
from new international entrants, is positive, with active demand from existing
customers. Recent openings include Noodle & Beer, Sushinoya and Arome
Bakery, each contributing to the area's expanding mix of pan-Asian cuisine and
specialist bakery operators. Ning's Fresh Beef Hot Pot has joined Chinatown
for what will be the brand's second location, serving authentic Cantonese
cuisine. Chinatown London was at the centre of the Chinese New Year
festivities, the largest celebration in the world outside of Asia, welcoming
thousands of visitors over the 15-day celebration period.
During the year, 37 lettings and renewals were completed with a rental value
of £8.7 million, 15.7 per cent ahead of December 2024 ERV and 27.3 per cent
ahead of previous passing rents.
A total of 30 rent reviews, representing £10.5 million of rental value, were
concluded at an average uplift of 6.1 per cent above previous passing rents.
Office (19 per cent of the property portfolio under management value)
Our prime West End office portfolio is well let, with customers continuing to
prioritise high-quality, well-designed space in locations that support
employee experience and productivity. Demand is increasingly centred around
buildings that offer high-quality fit-outs, access to exceptional district
amenities and strong sustainability credentials.
Our offices benefit from unparalleled connectivity, with short walking
distances to busy West End stations including Covent Garden, Leicester Square,
Charing Cross, Oxford Circus, Piccadilly Circus and Tottenham Court Road.
Customers place high value on being located within vibrant mixed-use
neighbourhoods, where retail, dining, culture and leisure are on the doorstep.
We continue to see customers relocating from other parts of central London as
employers recognise the importance of location in attracting and retaining
talent. Our Carnaby | Soho and Covent Garden offices have captured this
demand, with lettings to occupiers in the financial, professional services and
real estate sectors.
Our refurbishment strategy remains focused on delivering spaces that meet a
broad spectrum of customer requirements - from larger floorplates to highly
flexible, ready-to-occupy suites - ensuring we can accommodate both
established organisations and fast-growing businesses. The range of options
across our portfolio continues to support customer expansion and long-term
retention. During the year, refurbishment of 23,000 square feet at The Floral,
Covent Garden, rated BREEAM Excellent, completed and is fully occupied,
together with new signings on King Street, Ganton Street and Carnaby Street,
commanding rents of over £110 per square foot.
During the year, 46 office leasing transactions were completed with a rental
value of £6.1 million, achieving 7.2 per cent ahead of December 2024 ERV and
11.1 per cent ahead of previous passing rents.
A total of six rent reviews, representing £0.3 million of rental value, were
concluded at an uplift of 8.5 per cent above previous passing rents.
Residential (12 per cent of the property portfolio under management value)
The residential portfolio has performed well, with sustained leasing demand
and high rates of renewal across our 659 apartments. Demand continues to be
driven by the quality and character of our period buildings, which combine
modern specification with the advantages of vibrant neighbourhoods and
well-managed estates. These attributes remain highly valued by residents
seeking convenience, connectivity and cultural proximity. Throughout the year
we have seen competitive demand across all unit types, limited voids and short
re-letting periods, reflecting the appeal of our homes and the continued
strength of the central London rental market, with limited new supply
supporting rental levels and occupancy. Investor sentiment towards the
residential sector weakened in 2025, notwithstanding the continued rental
growth, as regulatory uncertainty weighed on transaction volumes.
Looking ahead, our focus is on maintaining quality, improving energy
efficiency and ensuring the residential portfolio continues to play a role in
supporting our vibrant, mixed-use neighbourhoods. Across the year, 285
residential lettings and renewals were completed, generating a rental value of
£10.9 million, averaging 6.4 per cent ahead of December 2024 ERVs and 3.9 per
cent ahead of previous passing rents. At 31 December 2025, 0.7 per cent of the
portfolio was available to let, demonstrating the depth of demand and the
resilience of occupancy levels.
Creating unrivalled consumer experiences across our West End portfolio
Through carefully crafted events, targeted campaigns and memorable consumer
moments, we enliven our vibrant, predominantly pedestrianised and
traffic-calmed destinations, attracting visitors, building loyalty and driving
repeat visits.
Our year-round, differentiated consumer experiences enhance key metrics
including footfall, conversion and spend and, alongside strong customer
partnerships, directly support long-term rental growth prospects.
Our digital platforms including social media, email newsletters and websites
continue to see significant growth. During the year, our level of engagement
and number of followers increased by 17.8 per cent in aggregate across all
destinations. We have direct engagement with over 1.6 million consumers across
our channels and in December 2025 launched a new consumer website for Covent
Garden.
Our West End portfolio has welcomed a number of unique activations from global
brands seeking a world-class destination to engage with both new and existing
customers. For example, Chanel unveiled an experiential installation that
reimagined skate culture through a luxury lens, celebrating a decade since
opening their first ever beauty store in Covent Garden.
Carnaby Street celebrated the start to the Christmas season with the switch-on
of the 'All Is Bright' festive lights, attracting thousands of visitors to the
area. The lights were switched on by Charlotte Tilbury MBE, following the
recent opening of a flagship store on Carnaby Street, marking a high-profile
moment for the destination. In Covent Garden, Hollywood and West End actress
Hayley Atwell switched on the Christmas lights alongside British stars of
stage and screen. The "Theatre of Christmas" celebration honoured Covent
Garden's theatrical heritage, in support of charity partner Acting For Others.
Chinatown once again played host to the annual Chinese New Year parade, the
largest outside of Asia, welcoming thousands of visitors over the 15-day
celebration period.
High occupancy
At 31 December 2025, EPRA vacancy (including units under offer) was 4.2 per
cent of portfolio ERV (Dec 2024: 3.9 per cent); as summarised in the tables
below, 1.6 per cent was under offer and 2.6 per cent was available-to-let.
Under offer
Use % of portfolio under management ERV ERV Area
£m ('000 sq. ft.)
Retail 0.7 1.7 9
Food & beverage 0.8 2.0 26
Offices 0.1 0.2 4
Residential 0.0 0.1 2
Total(1) 1.6 4.0 41
1. Includes nine units let on a temporary basis (ERV: £1.3 million) (Dec
2024: £1.5 million).
Available-to-let space
Use % of portfolio under management ERV
ERV Area
£m ('000 sq. ft.)
Retail 0.7 1.7 15
Food & beverage 0.5 1.4 19
Offices 0.7 1.9 32
Residential 0.7 1.8 31
Total 2.6 6.8 97
Refurbishment activity
Active asset management and refurbishment initiatives continue to realise
income and value while enhancing environmental performance across the
portfolio. £33.1 million was invested in capital expenditure in 2025.
Refurbishment projects currently underway represent £11.3 million in ERV
across 130,000 square foot equating to 4.2 per cent of total portfolio ERV,
with delivery expected over the next 12-18 months.
Larger refurbishments include a retail scheme on Broadwick Street, mixed-use
retail and office schemes on Floral Street and an important gateway site on
Neal Street as well as an office-to-residential conversion on the upper parts
of James Street, Covent Garden. Improvements to the Henrietta Street public
realm are underway and are expected to be completed by the end of 2026. The
works include widening the footway, creating a level surface to improve
accessibility, and upgrading the surfacing to enhance the historic character.
Public lighting will be improved while retaining the heritage-listed gas lamp
columns. Clearer pedestrian routes and sightlines will help activate the
street, alongside enhanced al fresco dining through the introduction of
awnings and greening.
Under refurbishment
Use % of portfolio under management ERV ERV (£m) Area
('000 sq. ft.)
Retail 0.3 0.8 7
Food & beverage 0.7 1.8 22
Offices 3.0 8.2 93
Residential 0.2 0.5 8
Total 4.2 11.3 130
Lillie Square joint venture
Shaftesbury Capital owns 50 per cent of the Lillie Square joint venture, a
residential estate and remaining development phases located in West London.
Investor sentiment towards the residential sector weakened in 2025, as
regulatory uncertainty weighed on transaction volumes. The property valuation
of our 50 per cent share as at 31 December 2025 was £62.3 million, 4.6
(like-for-like) per cent below the 31 December 2024 valuation of £65.3
million. In addition, Shaftesbury Capital owns £1.9 million of other related
assets adjacent to the Lillie Square estate. The joint venture has cash of
£9.7 million (£4.9 million Shaftesbury Capital share). In total, 355 Phase 1
and 2 residential apartments have been sold.
Commitment to environmental stewardship
Sustainability is central to Shaftesbury Capital's values and long-term
investment approach. Our approach to future-proofing our West End heritage
buildings recognises their role as long-term carbon stores, prioritising
low-carbon refurbishment while enhancing energy efficiency. We continue to
deliver measurable improvements through a rolling programme of
energy-efficient refurbishments, aligned with a Science Based Targets
initiative (SBTi)-validated 2040 Net Zero Carbon target. New commercial
refurbishments are designed to achieve a minimum EPC rating of B. As at
December 2025, 94 per cent of our portfolio by ERV is rated EPC A to C, with
85 per cent of commercial EPCs rated A or B by ERV. We have enhanced our
environmental data through increased coverage of meters. 2025 saw a 29 per
cent annual decrease in our scope 1 and 2 carbon emissions, and a 7 per cent
decrease in associated scope 3 emissions. We remain on track for our 2040 net
zero carbon targets with a cumulative decrease in absolute greenhouse gas
emissions of 54 per cent from our 2019 baseline year.
We participate in a range of external benchmarks and indices, providing
independent recognition of our sustainability performance and identifying
opportunities for improvement. In 2025, we maintained Gold Award status for
our EPRA Sustainability disclosures, and achieved a CDP climate disclosure
rating of B, an MSCI rating of BBB and a GRESB score of 66.
Active community investment
Shaftesbury Capital has a strong record of supporting the local community. We
partner with a wide range of charitable and community initiatives across
Westminster and Camden, focusing on local employment and community cohesion.
In 2025, we implemented our three-year community strategy, which is centred on
supporting local employment opportunities, the area where we can deliver the
greatest long-term benefit. This year, our direct total community contribution
was £1.1 million. Employee volunteering hours increased by 12 per cent from
2024. We have also introduced a measure to quantify the wider social value of
our estate management initiatives, using the nationally recognised TOMs
("Themes, Outcomes, Measures") framework, totalling social value of £5.9
million for 2025.
Supporting local employment is a focus of our investment, which includes our
partnership with the Department for Work & Pensions to launch Shaftesbury
Capital Recruit, a free service supporting retail customers with recruitment.
We also collaborated with industry peers to deliver a West End recruitment
fair attended by more than 700 people. We support a range of community-led
initiatives, working with partners to deliver employment and education
programmes. Our impact extends beyond our buildings, and through thoughtful
placemaking we continue to enhance the public realm across our portfolio,
delivering pedestrianisation, streetscape improvements, greening, outdoor
seating and measures to reduce traffic congestion and air pollution.
We have a Community Investment Forum ("CIF") comprising employees from across
the business which is responsible for overseeing our programme of community
investment. It enables us to review our community investments and consider
applications for our community grants. We continue our support of culture and
the arts, including the patronage of the Donmar Theatre in Seven Dials, as
well as partnerships with the Society of London Theatres, British Fashion
Council and London & Partners.
FINANCIAL REVIEW
2025 was a year of positive performance with growth in rental income,
earnings, dividends, property valuation and net tangible assets per share. We
are pleased to have introduced private capital through the formation of a
long-term partnership on Covent Garden with the Norwegian sovereign wealth
fund which highlights the fundamental value and attractiveness of our
portfolio, and to have further strengthened our balance sheet through our
financing activities and enhanced the Group's financial flexibility.
Total accounting return for the year was 9.1 per cent and a total property
return of 10.1 per cent was achieved, representing 3 percentage points of
outperformance against the MSCI UK property index. ERV increased by 6.2 per
cent resulting in 6.6 per cent growth in the valuation of property under
management on a like-for-like basis. Underlying earnings increased by 12.2
percent to £81.9 million and the dividend increased by 14.3 per cent for the
year, reflecting the progression in underlying and cash earnings. The Group
maintains a strong balance sheet with EPRA loan-to-value of 16.8 per cent and
significant headroom against debt covenants. The Group has access to liquidity
of £1.0 billion, positioning it to act on market opportunities.
On 1 April 2025, the Group completed the sale of a 25 per cent non-controlling
interest in the Covent Garden estate to Norges Bank Investment Management
("NBIM"). The transaction valued the Covent Garden estate in line with its
independent property valuation as at 31 December 2024 and generated gross cash
proceeds of £574 million for the Group.
Presentation of information
The Group financial statements are prepared under IFRS whereby the Group fully
consolidates the Covent Garden estate, with NBIM's 25 per cent interest in
Covent Garden presented as a non-controlling interest.
Prior to the establishment of the Covent Garden partnership, the Group's focus
was primarily on the wholly-owned portfolio with information presented on an
IFRS basis. Following the sale of the 25 per cent non-controlling interest in
the Covent Garden estate, management considers the business principally on a
Group share basis with the non-controlling interest removed on a line-by-line
basis. The key financial performance indicators are also presented on this
basis. Results for the first quarter of the year reflect 100 per cent
ownership of Covent Garden, whilst the remaining three quarters reflect a
gross cash inflow of £574 million and the Group's 75 per cent ownership
post-completion of the transaction.
The Group's share of joint ventures and associates continues to be viewed as a
single line item. The Group holds a 50 per cent interest in the Lillie Square
joint venture. Lillie Square is not considered to be a core part of the
operations of the Group and therefore its results are not included on a Group
share basis and are excluded from the calculation of underlying earnings. In
the prior year the Group also held a 50 per cent interest in the Longmartin
investment, which was sold to the partner in October 2024.
A summary income statement and balance sheet which reconcile the IFRS reported
results to Group share are set out within the alternative performance and EPRA
measures on page 46.
Financial highlights
We have delivered continued strong operational and financial performance
across the Group. Activity levels remained consistently high, as evidenced by
the vibrancy of our estates, footfall, customer sales, leasing volumes and the
strong pipeline.
Underlying earnings increased by 12.2 per cent to £81.9 million, equivalent
to 4.5 pence per share, driven primarily by higher net rental income, on a
like-for-like basis, and cost efficiencies including lower net finance costs.
The Group's cost ratio, which adjusts for the non-cash share award charge, has
reduced to 33.1 per cent (Dec 2024: 36.2 per cent). The Directors have
proposed a final dividend of 2.1 pence per share, which when combined with the
interim dividend of 1.9 pence results in a total dividend for the year of 4.0
pence per share. This represents an increase of 14 per cent compared with the
3.5 pence per share dividend for 2024 (H1 2024: 1.7 pence; H2 2024: 1.8
pence).
Property assets under management have been independently valued at £5,407.1
million, reflecting 6.6 per cent like-for-like growth. ERV increased by 6.2
per cent (like-for-like) to £270.3 million and annualised gross income was up
5.3 per cent like-for-like to £215.0 million. The equivalent yield of the
portfolio was 4.43 per cent, reflecting a marginal inward movement of 2 basis
points since 31 December 2024.
During the year, £113.3 million was invested into asset acquisitions and
capital expenditure across the portfolio and proceeds of £12.4 million were
realised on the sale of three properties.
Overall EPRA NTA (net tangible assets) per share increased by 7.2 per cent
from 200.2 pence to 214.7 pence. Combined with the 3.7 pence per share
dividend paid to shareholders during the year, the total accounting return for
the year was 9.1 per cent. Total shareholder return for the year was 18.6 per
cent, reflecting dividends paid and the change in the share price from 125.5
pence to 144.5 pence per share. Total property return was 10.1 per cent,
outperforming the 7.1 per cent return on the MSCI Total Return Index.
Net finance costs have been reduced by 28 per cent from £57.2 million to
£41.4 million primarily due to the increase in interest income earned on the
cash proceeds received from the sale of a non-controlling interest in Covent
Garden. The proceeds were used in part to reduce gross debt by £242 million
and are expected in due course to be used for the repayment of the £275
million of exchangeable bonds which are due to mature in March 2026.
The Group has a strong balance sheet with an EPRA loan-to-value ratio of 16.8
per cent (Dec 2024: 27.4 per cent) and net debt of £0.8 billion (Dec 2024:
£1.4 billion). The ratio of net debt to EBITDA has been reduced from
approximately 11 to under 7 times. There is substantial headroom against debt
covenants and access to liquidity, including undrawn committed bank facilities
of £675 million.
Alternative performance measures
As is usual practice in the real estate sector, alternative performance
measures ("APMs") are presented for certain indicators, including earnings,
earnings per share and EPRA net tangible assets, making adjustments set out by
EPRA in its Best Practice Recommendations. These recommendations are designed
to make the financial statements of public real estate companies more
comparable across Europe, enhancing the transparency, comparability and
coherence of the sector.
One of the key performance measures which the Group uses is underlying
earnings. The underlying earnings measure reflects the underlying financial
performance of the Group's West End property rental business, on a Group share
basis, and is a relevant metric in determining dividends. The measure aligns
with the main principles of EPRA earnings. EPRA earnings excludes valuation
movements on the property portfolio, profit or loss on disposal of investment
properties and investment in subsidiaries and associates, fair value changes
of financial instruments, cost of early close out of debt and adjustments in
relation to any other non-operating and exceptional items.
The non-operating and exceptional items adjusted for by the Group in the
current and prior year include non-recurring corporate and transaction costs.
These costs are considered non-recurring as they relate to significant
transactions outside the ongoing operations of the Group. Other exceptional
items adjusted for include the fair value movements of the option component of
the exchangeable bond, and following the completion of the all-share merger in
March 2023, the unwinding of the IFRS 3 fair value of debt.
In calculating underlying earnings, additional adjustments of £6.7 million
(Dec 2024: £2.3 million) are made to EPRA earnings to exclude the financial
performance of the Lillie Square joint venture, associated tax adjustments and
the interest receivable on the loan issued to the joint venture by the Group.
Lillie Square is not considered to be a core part of the operations of the
Group and therefore its results are not included in underlying earnings.
Further details on APMs used and how they reconcile to IFRS are set out on
page 46.
INCOME STATEMENT
Underlying earnings is a key measure used by the Group to assess performance. The numbers for 2025 presented below are on a Group share basis for the Covent Garden estate (reflecting the Group's 75 per cent ownership) and profits from associates (which relate to the prior year) are reflected as a single line item. Further details regarding underlying earnings are set out in note 3 'Performance measures'.
2025 2024
£m £m
Gross profit(1) 161.1 167.1
Other income(1) 3.0 -
Administration expenses(1) (41.0) (39.4)
Net finance costs(1) (41.4) (57.2)
Profit from associates(1) - 2.8
Taxation(1) 0.2 (0.3)
Underlying earnings for the year(1) 81.9 73.0
Non-controlling interest 47.2 -
EPRA and non-underlying adjustments 258.3 179.1
IFRS profit for the year 387.4 252.1
Underlying earnings per share 4.5p 4.0p
IFRS earnings per share 18.7p 13.8p
Dividend per share 4.0p 3.5p
1. Numbers for 2025 are presented on a Group share basis.
Gross profit
2025 2024
£m £m
Rent receivable 212.7 197.2
Straight lining of tenant lease incentives 3.6 7.8
Revenue attributable to non-controlling interest for 9-month period April to (20.7) -
December 2025
Revenue 195.6 205.0
( )
Property expenses (33.7) (33.1)
Expected credit loss provision (3.3) (3.9)
Tenant lease incentives written off (1.6) (0.9)
Costs attributable to non-controlling interest for 9-month period April to 4.1 -
December 2025
Costs (34.5) (37.9)
Gross profit(1) 161.1 167.1
1. Gross profit for 2025 is presented on a Group share basis.
Positive leasing and asset management activity across the portfolio has
resulted in an increase in rent receivable, up 5.9 per cent on a like-for-like
basis, adjusting for acquisitions and disposals, and for the sale of the 25
per cent interest in the Covent Garden estate, which took effect on 1 April
2025.
Cash collections have continued to be strong with limited customer
administrations or anticipated failures in the year. Property costs have
remained consistent on an IFRS basis, with inflationary pressures offset by
operational efficiencies.
Gross profit attributable to the non-controlling interest for the nine-month
period 1 April to 31 December 2025 was £16.6 million.
Other income
Following the 25 per cent investment by NBIM in the Covent Garden estate, the
Group provides day-to-day asset management and property management services.
Asset management fees, broadly reflecting the costs of managing the estate,
are paid to the Group and together with other items, £3.0 million of income
was recognised in the year in respect of the 9 months commencing on 1 April
2025.
Administration expenses
Underlying administration expenses of £41.0 million have been incurred during
the year, reflecting ongoing efficiencies with an offsetting increase in
non-cash share award charges (which were £4.6 million higher than in the
prior year). Administration expenses now include a running cost of three
years of share award charges for the first time since merger completion in
2023. In view of strong relative performance against the peer group on the TAR
measure, expected vesting assumptions have been increased in relation to the
2023 awards. Adjusting for this, and reflecting the effect of ongoing
efficiencies, cash administration costs were effectively eight per cent lower
relative to 2024, and further cost savings are targeted over the next two
years.
£5.9 million (Dec 2024: £3.3 million) of non-recurring corporate and
transaction related administration costs, which do not relate to the ongoing
operations of the Group, have been incurred during the year.
The Group's cost ratio, which adjusts for the non-cash share award charge, has
reduced to 33.1 per cent (Dec 2024: 36.2 per cent).
Net finance costs
The cash inflow from the transaction of £574 million brought net debt down
significantly. Net finance costs have been reduced to £41.4 million (Dec
2024: £57.2 million). Finance costs of £61.6 million were incurred in the
year with the average gross drawn debt balance of £1.4 billion, reducing to
£1.2 billion at 31 December 2025.
Finance income of £20.2 million comprises £3.2 million in relation to
interest rate hedging arrangements and £17.0 million interest on cash held on
deposit.
The majority of the Group's debt is at fixed rates, and as at the year end,
the Group had only £75 million of drawn debt at variable rates. Protection is
currently in place in relation to the interest rate exposure on the Group's
expected drawn variable rate debt until the end of 2026 through derivative
contracts entered into in December 2025. These comprise interest rate caps for
SONIA exposure at 3 per cent for notional value of £150 million in each of
Covent Garden and the Group. It is expected that further interest rate hedging
arrangements will be put into place in due course, as appropriate, in relation
to variable rate exposure for future years.
In 2026, we will refinance or repay £400 million of maturing debt, comprising
the exchangeable bonds and private placement loan notes; however based on
current borrowing levels we are targeting finance costs to be broadly flat
overall.
Profit from associates
In October 2024 the sale of our 50 per cent share in Longmartin investment was
completed. Up until October 2024 the investment was presented as an associate
with our share of the profit included in the underlying metrics.
Taxation
The Group continues to satisfy the requirements to qualify for REIT status.
Therefore, as its income is derived substantially from qualifying property
rental business activities within the REIT regime, the majority of its income
is exempt from tax. There is a tax credit of £0.2 million in the year (2024:
£0.3 million charge) arising in respect of an adjustment to the prior period
tax charge relating to non-REIT activity.
Dividends
The Board has proposed a final dividend of 2.1 pence per share, bringing the
total dividend to 4.0 pence per share (2024: 3.5 pence per share), reflecting
progression in underlying earnings and cash generation. The dividend is to be
paid wholly as a PID on 22 May 2026 to shareholders on the register at 24
April 2026.
SUMMARY BALANCE SHEET
The summary balance sheet below as at 31 December 2025 is presented on a Group
share basis, excluding the 25 per cent non-controlling interest in the Covent
Garden estate.
31 December 31 December 2024
2025
IFRS Adjustment for non-controlling interest Group share IFRS
£m £m £m £m
Property portfolio(1) 5,358.0 (697.1) 4,660.9 4,929.0
Net debt(2) (901.5) 88.2 (813.3) (1,405.0)
Other assets and liabilities 111.6 (5.0) 106.6 150.3
Non-controlling interest (613.9) 613.9 - -
Net assets (IFRS and Group share) 3,954.2 - 3,954.2 3,674.3
EPRA net tangible assets 3,954.9 - 3,954.9 3,671.1
EPRA net tangible assets per share (pence) 214.7p - 214.7p 200.2p
Adjusted, diluted number of shares(3) 1,842.3m - 1,842.3m 1,833.3m
1. Includes £20.7 million (2024: £20.1 million) accounted for as
owner-occupied property and £nil (2024: £9.8 million) accounted for as held
for sale. The market value of the property portfolio under management is
£5,407.1 million (2024: £4,973.5 million).
2. Net debt based on nominal value of debt drawn less cash, excluding tenant
deposits of £11.6 million (2024: £14.2 million).
3. Number of shares excludes 128.4 million shares held in relation to the
exchangeable bond and 3.1 million within an approved Employee Benefit Trust.
Total shares in issuance, including these components, was 1,953.2 million
shares.
IFRS net assets and EPRA NTA have increased by 7.2 per cent in the year,
primarily due to the like-for-like increase in the valuation of the property
portfolio. The non-controlling 25 per cent interest in the Covent Garden
partnership is £613.9 million, having increased by £47.2 million since
completion of the transaction in April 2025. £7.9 million of dividends were
paid to NBIM during the year, representing 25 per cent of the Covent Garden
dividends for the period April to September 2025.
Property portfolio
The carrying value of the portfolio under management, reflected at 100 per
cent, as at 31 December 2025 is £5,358.0 million having increased from
£4,929.0 million at 31 December 2024.
The independent market valuation of the portfolio of £5,407.1 million has
increased by 6.6 per cent (like-for-like) since 31 December 2024 driven by ERV
growth of 6.2 per cent (like-for-like) and the equivalent yield of 4.43 per
cent (Dec 2024: 4.45 per cent).
£80.2 million (before costs) has been invested in targeted acquisitions in
Covent Garden and Soho, presenting asset management opportunities with
excellent rental growth prospects and the pipeline of acquisitions is
encouraging, with a number of buildings currently under review.
Capital expenditure during the year was £33.1 million, predominantly relating
to office refurbishments in Covent Garden.
The sale of three properties, including the last remaining Fitzrovia assets,
was completed in the year for total proceeds of £12.4 million, in line with
the 31 December 2024 valuation.
Debt and gearing
The Group maintains a strong financial position, with diversified sources of funding, a spread of debt maturities, significant headroom against debt covenants, access to liquidity, modest capital commitments, significant unencumbered asset value and interest rate hedging in place for 2026.
The Group's cash and undrawn committed facilities as at 31 December 2025 were
£1,014.1 million (Dec 2024: £559.8 million). As at 31 December 2025, the
Group had capital commitments of £8.9 million.
Group share(1) 31 December 31 December 2024
2025 £m
£m
Cash and cash equivalents(2) 339.1 109.8
Undrawn committed facilities 675.0 450.0
Cash and undrawn committed facilities 1,014.1 559.8
Commitments (8.9) (24.1)
Available resources 1,005.2 535.7
1. Numbers for 2025 are presented on a Group share basis.
2. Excludes tenant deposits of £11.6 million (Dec 2024: £14.2 million).
It is expected that £275 million of the cash and cash equivalents on balance
sheet will be applied towards repayment of the exchangeable bonds upon
maturity in March 2026.
The loan-to-value ("LTV") ratio and EPRA LTV at 31 December 2025 were 17 per
cent. This is comfortably within the Group's limit of no more than 40 per
cent. Net debt to EBITDA has been reduced from a multiple of approximately 11
to under 7 times.
Group share(1) 31 December 31 December 2024
2025
£m
£m
Cash and cash equivalents 339.1 109.8
Debt at nominal value (1,152.4) (1,514.8)
Net debt (813.3) (1,405.0)
Loan-to-value 17.3% 28.2%
EPRA loan-to-value 16.8% 27.4%
Net debt to EBITDA 6.6x 10.9x
Interest cover 396.4% 292.1%
Weighted average debt maturity - drawn facilities 4.0 years 4.6 years
Weighted average cost of debt - gross 3.6% 4.0%
Weighted average cost of debt - net 3.4% 3.7%
Drawn debt with interest rate protection(2) 100% 100%
1. Numbers for 2025 are presented on a Group share basis.
2. Taking account of interest on cash deposits and interest rate caps.
At 31 December 2025, Group net debt was £813.3 million having reduced
significantly following the receipt of the £574 million of gross proceeds
from the creation of the Covent Garden partnership with NBIM. Proceeds have
been used to reduce drawn debt, with partial repayment of the Canada Life term
loan (£67.4 million of the £135 million, which utilised approximately £42
million of the proceeds net of restricted cash), repayment of a £200 million
term loan in October 2025 and in due course we are positioned for repayment of
the £275 million of exchangeable bond due in March 2026. In the meantime, the
remaining proceeds are held on deposit until deployed.
In October 2025, the Covent Garden partnership entered into a new five-year
£300 million (£225 million at Group share) unsecured revolving credit
facility which is undrawn.
The maturity of the Group's £150 million unsecured revolving credit facility
was extended from December 2027 to December 2030 and the £300 million
unsecured revolving credit facility from December 2028 to December 2029. The
margins on these loans were reduced to better reflect market conditions and
further strengthen the Group's position. The facilities are currently undrawn.
The weighted average cash cost of drawn debt is 3.6 per cent (Dec 2024: 4.0
per cent) which reduces to an effective cash cost of 3.4 per cent (Dec 2024:
3.7 per cent) taking into account interest income on cash deposits and the
benefit of interest rate hedging. As maturing debt is repaid or refinanced
(including the £275 million of exchangeable bond, which has a cash coupon of
2 per cent), based on current market interest rates, it is currently
anticipated that the weighted average cost of debt will increase.
All of the Group's drawn debt is at fixed rates or currently has interest rate
protection in place. £300 million of hedging (comprising £150 million at
Group and £150 million in the Covent Garden partnership) has been entered
into during the year and is in place until the end of 2026 which provides for
a cap of 3.0 per cent on SONIA exposure.
Financing opportunities will continue to be reviewed over the coming year,
taking advantage of the Group's attractive credit profile.
Cash flows
Movement in cash flow - Group share 2025
£m
Cash, excluding tenant deposits, as at 31 December 2024 109.8
Non-controlling interest's share of cash acquired (7.5)
Operating inflow 104.0
Investing outflow (107.1)
Financing inflow 306.6
Dividends paid (66.7)
Cash, excluding tenant deposits, as at 31 December 2025 339.1
The overall balance of cash increased by £229.3 million to £339.1 million as at 31 December 2025. This is due largely to:
· Operating cash inflows of £104.0 million reflecting growing
gross profit and continuing high levels of cash collection, partly offset by
administrative and finance costs. The inflow is further reduced for the
payment of non-underlying administrative costs, non-underlying transaction
costs for property acquisitions and disposals and costs related to the sale of
Covent Garden partnership.
· Investing cash outflows of £107.1 million, including £9.4
million of gross proceeds from the sale of three properties offset by £31.5
million capital expenditure and £85.1 million for property acquisitions
(including acquisition costs).
· The £267.4 million financing outflow reflects the net movement
in facilities drawn and repaid in the year. In addition, £574 million of
gross proceeds were received on completion of the long-term Covent Garden
partnership.
· Total dividends paid in the year excludes £4.7 million paid to a
Group entity which holds 128.4 million shares in relation to the exchangeable
bonds. Following the dividend threshold test, as set out in the exchangeable
bond conditions, substantially all of the dividend was subsequently retained
by the Group.
Going concern
Further information on the going concern assessment is set out in note 1
'Principal accounting policies'.
The Group has a strong balance sheet with EPRA loan-to-value of 16.8 per cent,
Group interest cover of 4.0 times, and access to cash of £339.1 million and
undrawn facilities of £675.0 million as at 31 December 2025. There remains
sufficient liquidity and debt covenant headroom even in a "severe but
plausible" downside scenario.
There continues to be a reasonable expectation that the Group will have
adequate resources to meet both ongoing and future commitments for at least 12
months from the date of signing these financial statements. Accordingly, the
Directors consider it appropriate to adopt the going concern basis of
accounting in preparing the 2025 Annual Report.
Situl Jobanputra
Chief Financial Officer
24 February 2026
PRINCIPAL RISKS AND UNCERTAINTIES
Risk management
The Board has overall responsibility for Group risk management. It determines
its risk appetite and reviews principal risks and uncertainties regularly,
together with the actions taken to mitigate them. The Board has delegated
responsibility for the review of the adequacy and effectiveness of the Group's
internal controls framework to the Audit Committee.
Risk is a standing agenda item at management meetings. This gives rise to a
more risk-aware culture and consistency in decision-making across the
organisation in line with the corporate strategy and risk appetite. All
corporate decision-making takes risk into account, in a measured way, while
continuing to drive an entrepreneurial culture. The Executive Committee and
senior management team are responsible for the day-to-day commercial and
operational activity across the Group and are, therefore, responsible for the
management of business risk.
The principal risks and uncertainties facing the Group are set out on the
following pages with the potential impact and the mitigating actions and
controls in place. These risks are reviewed and updated on a regular basis.
The Group's approach to the management and mitigation of these risks is
included in the 2025 Annual Report. The Board has confirmed that its risk
appetite and key risk indicators remain appropriate.
Risk outlook and emerging risks
Looking ahead to 2026, there is a high degree of interconnectedness between
macroeconomic conditions and the global geopolitical climate which could
affect the Group's risk profile. While inflationary pressures and interest
rates may show signs of improvement, shifts in trade policy, regional
conflicts, regulatory changes, inflation, and capital market volatility could
continue to influence investor sentiment, financing costs, occupational
demand, travel patterns, consumer behaviour and real estate valuations.
Climate change, environmental regulation and sustainability expectations
continue to represent an area of focus and potential risk. Failure to comply
with evolving regulatory requirements or meet stakeholder expectations could
result in financial, operational or reputational impacts. In addition,
physical climate risks and the cost of adapting assets to meet environmental
standards may increase over time, requiring ongoing investment and active
management. The regulatory landscape also continues to evolve and bring
additional challenges and costs of compliance.
The Group actively monitors emerging risks to identify and assess issues that
could affect the delivery of its strategic objectives. These risks arise from
evolving circumstances or trends which may develop rapidly and could have a
significant impact on the Group's financial strength, competitive position or
reputation, either over the next three years or in the longer term. At this
stage, the likelihood and potential impact of such risks are often uncertain,
and appropriate mitigation actions may not yet be fully developed.
The Group undertakes regular horizon-scanning to identify potential risks and
emerging trends that may become significant in the future. The most relevant
risks and opportunities identified through this process are assessed to
determine their relevance and whether any additional actions are required.
Prioritised emerging risks are then reviewed and validated by senior
management to better understand their potential impact and to develop
appropriate strategies to manage them. A non-exhaustive list of emerging risks
is outlined below.
Emerging risks with a one to three-year time horizon include:
· UK fiscal and monetary policy and political uncertainty,
alongside evolving geopolitical risks, impacting confidence, investment and
occupier demand;
· Landlord, tenant and wider regulatory reform, including
implementation of the Renters' Rights Act from 2026;
· Implementation of the Building Safety Act and evolving UK
property valuation standards and practices;
· Planning and environmental policy changes affecting development
feasibility, cost and timelines;
· Changes to residential rent controls; and
· Technology disruption (particularly the impact of AI) and
associated cyber, fraud and business-model impacts across customer and
operations.
Emerging risks with a longer-term horizon include:
· Shifts in social dynamics and demographics, including changes in
how space is used, patterns of urbanisation, consumer spending and travel
patterns;
· Evolving consumer preferences and behaviours;
· Long-term impacts of climate change;
· Influence of technological developments, including in areas such
as digital currencies on consumer behaviour and payment practices; and
· Changes to property-related tax and regulatory changes.
Economic and political
Risk Impact on Strategy Mitigation
Decline in real estate valuations driven by macroeconomic conditions, interest Lower rental income due to customer demand, affordability pressures or tenant Maintain appropriate liquidity to meet operational and financial commitments
rates and investor sentiment failures
Target longer and staggered debt maturities, and diversified sources of
Changes to government policy, legislation and regulation impacting the Increased vacancy levels, incentives or longer letting periods resulting in funding
property sector lower rental income
Undertake early refinancing of upcoming debt maturities where appropriate
Weak or volatile business and consumer confidence Downward pressure on capital values and portfolio valuations
Covenant headroom monitored and stress tested
Inflationary pressures on operating costs, including energy and the Higher finance costs due to increased interest expense on new or refinanced
cost-of-living debt Fixed rate financing and derivative contracts to provide interest rate
protection
Increased material costs, supply chain disruptions and labour shortages Higher operating costs due to inflation in property operating costs, energy,
affecting customers insurance and service contracts Counterparty credit monitoring, early intervention, diversification by
concept, price point and covenant quality
Reduced availability and/or increased cost of debt or equity funding; Reduced financial and operational flexibility due to constraints on capital
financial market volatility and/or disruption investment, development activity or asset repositioning Monitoring proposals and emerging policy and legislation, with industry
lobbying where appropriate
Uncertainty over the level and trajectory of interest rates
Engagement with key stakeholders and local authorities
Persistent discount of The Group's share price relative to EPRA NTA
Monitoring of key indicators including interest rate and yield movements,
capital market liquidity, valuation trends, customer demand and occupancy
levels, and the Group's EPRA NTA discount
Change in 2025: Stable
Context and actions taken:
The Group's focus on prime West End assets has historically provided
resilience through economic cycles, supported by strong underlying demand, low
vacancy levels and sustained footfall.
The Group has had a long-term focus on maintaining a strong balance sheet,
with sufficient liquidity and debt covenant headroom, to ensure it is able to
withstand market volatility and take advantage of opportunities. As at 31
December 2025, the Group had access to cash of £339 million and undrawn
facilities of £675 million providing substantial headroom against foreseeable
commitments. Funding, debt and treasury metrics are monitored on a continual
basis with a focus on preserving liquidity and capital, maintaining leverage
and managing refinancing risks.
Extensive forecasting, stress testing and scenario modelling has been
undertaken, including sensitivities to interest rates, valuation movements,
rental income and cost inflation, to help inform decision making and capital
allocation.
A downside scenario has been analysed in connection with the going concern
assessment, details of which are set out in note 1 'Principal accounting
policies' within 'Going concern'. The financial statements have been prepared
on a going concern basis.
The Group remains in close dialogue with local authorities and key
stakeholders to understand policy developments and future plans, and to
position the estate constructively in response to potential legislative,
planning and regulatory changes.
Portfolio
Risk Impact on Strategy Mitigation
Inability of the Group to adopt the appropriate portfolio strategy to respond Inability to deliver the Group's business plan or need for structural change Focus on prime assets, locations and uses where, in normal conditions, there
effectively to changing market conditions and shifts in consumer behaviour and to the business plan impacting returns or capital values is a structural imbalance between availability of space and demand
customer requirements
Reduced flexibility to respond to adverse market conditions Concentration of assets where scale and control can be leveraged to influence
Portfolio concentration
place-making outcomes
Misalignment with joint venture partners Establish asset clusters to provide the opportunity to drive long-term growth
and returns
Volatility in the investment and capital markets, including changes in
investor sentiment and fluctuations in property yields and values
Regular strategic analysis with focus on creating mixed-use destinations and
residential districts with distinct and sustainable attributes
Market monitoring and valuation through regular assessment of investment
market condition and bi-annual external valuations to monitor portfolio
performance and value
Regular communication and agreed business plan with joint venture partners
Reconfigure and repurpose space to respond to, and anticipate, evolving
customer demand and consumer behaviour
Change in 2025: Stable
Context and actions taken:
The Group focuses on prime assets in the West End of London, predominantly
within the retail and food & beverage sectors.
While this portfolio concentration presents inherent risk, the Group considers
this focus to be a strategic strength, providing a high degree of influence
over defined areas and the ability to curate customer mix, uses and the public
realm in order to drive long-term value.
The Group actively promotes and manages its areas to sustain high levels of
footfall and to maintain locations that remain relevant, attractive and
commercially vibrant.
During 2025, sustained customer demand resulted in low vacancy levels across
the portfolio and consistently strong footfall performance.
Further to the introduction of NBIM as an investor in Covent Garden, the Group
has retained 75 per cent ownership and management control over the Covent
Garden estate but does not have sole control over all strategic, operational
and financial decisions relating to these assets. Contractual agreements for
the management are in place with regular communication between parties
throughout the year with performance tracked to the agreed business plan.
Through regular dialogue with current and potential customers, combined with
ongoing assessments of market conditions, the Group is able to better
understand market demand and consumer preferences and reconfigure and adapt
space as appropriate to support leasing performance and long-term returns.
Operational resilience
Risk Impact on Strategy Mitigation
Misconduct or poor operational or sustainability standards Reduced rental income as a result of business disruption, reduced footfall or Supplier procurement policy in place, with regular monitoring of third party
tenant impacts advisers and contractors
Poor performance, failure or misconduct by third-party advisers, contractors
or service providers including during period of transition Higher operating costs, including remediation, security, insurance or recovery Engagement with key stakeholders and local authorities
costs
Catastrophic or disruptive event such as a terrorist attack, natural disaster,
Comprehensive insurance cover, including building reinstatement, loss of rent
health pandemic or cyber security incident or cyber crime Reduced capital values and investment attractiveness and terrorist insurance
Reduced financial and operational flexibility Detailed business continuity and crisis communication plans in place
Business disruption or damage to property assets On-site physical security measures and cyber security systems in place to
protect data and IT infrastructure
Reputational damage to the Group and/or diminished attractiveness of London
as a destination Health and safety policies and procedures
Close liaison with police, National Counter Terrorism Security Office (NaCTSO)
and local authorities
Change in 2025: Stable
Context and actions taken:
While geographic concentration presents inherent risk, the Group's ownership
of prime West End real estate is also a significant strength, providing an
element of control and enabling active curation of areas to maintain locations
that are popular, safe and resilient. Given the high-profile nature of the
Group's assets, the risk of an external event is inevitably heightened. The
Group therefore places significant emphasis on maintaining appropriate
insurance cover and implementing effective security, operational and health
and safety frameworks. Business continuity plans for both employees and
service providers have been reviewed, including the introduction of external
resources if required, alongside associated HR policies, technology and
communication arrangements. IT security systems that support data security and
disaster recovery are in place.
Cyber security risk, including both widespread threats such as state-sponsored
attacks and those targeted directly at the Group's systems and data, remains a
key area of focus. The Group is supported by external advisers, including
specialist consultants, to ensure appropriate controls and security protocols
are maintained, and employees receive regular cyber security and phishing
awareness training.
Operational resilience, cyber security and business continuity arrangements
are reviewed regularly by management, with key risks and mitigation measures
reported to the Board.
Leasing and asset management
Risk Impact on Strategy Mitigation
Inability to achieve target rents or to attract and retain desired customer Decline in customer demand for the Group's properties Maintain a high quality and diversified customer mix aligned to each location
mix and high occupancy due to changing market conditions, shifts in consumer
behaviour and spending patterns and increased competition from alternative Reduced income and increased vacancy Strategic focus on creating mixed-use destinations with distinctive and
locations/formats
sustainable attributes
Reduced return on investment and development property
Unfavourable planning/licensing policy, legislation or action impacting on the
Early engagement with local and national authorities
ability to secure approvals or consents Reduced ability to deliver targeted rental growth and long-term valuation
creation Pre-application and consultation with key stakeholders and landowners
Regular assessment of market conditions, leasing performance and development
strategy
Active asset management to respond to changing customer and consumer demands
Business strategy based on delivering sustainable, long-term returns
Change in 2025: Stable
Context and actions taken:
The Group takes measured risks by using its expertise in place-making and
creative and active asset management to deliver long-term value through rental
growth and attracting new customers. During 2025, leasing activity remained
strong, with high occupancy levels reflecting the strength of demand for prime
central London real estate.
Many of the Group's customers operate within the retail and food &
beverage sectors and are exposed to a range of external pressures, including
the availability and cost of credit, cost-of-living impacts on consumer
spending, business and consumer confidence, inflation, energy costs and supply
chain disruption, labour availability and other operational cost pressures.
The Group actively seeks opportunities to create or enhance value through the
planning process, cognisant of the risks but leveraging the Group's experience
and capabilities to deliver strategic objectives.
The Group has a focused leasing, asset management and marketing strategy in
place, ensuring the business is well-positioned and regularly engages with
customers, suppliers and partners to ensure requirements, standards and
operational resilience is maintained
People
Risk Impact on Strategy Mitigation
Inability to attract, retain and develop suitable skilled and experienced Reduced ability to execute the Group's strategy and business plan Succession planning and identification of key roles and critical skills
employees, leadership and succession planning within the business
Key person risk Constrained growth and loss of strategic or commercial opportunities Regular performance evaluations, training and professional development
Increased pressure on corporate costs and operational effectiveness Long-term, competitive and performance-linked incentive arrangements
Flexible and modern working practices
Change in 2025: Stable
Context and actions taken:
The Group's success is driven by a dedicated team of skilled and talented
individuals working collaboratively across the business. The health, safety
and well-being of our people and service providers is of the utmost
importance, supported by a culture and environment that allows individuals to
grow, develop and perform to the best of their abilities.
There remains a risk of illness or absence across employees, management or
service providers which would disrupt the day-to-day activities of the Group's
business and running of the estate. Team communication and management
strategies have been implemented to ensure appropriate support, supervision
and collaboration where employees are working flexibly or remotely.
Recruiting and on-boarding policies have been reviewed and adapted where
necessary to ensure that the business is able to continue to attract, develop
and retain high-quality talent.
The Group continues to monitor employees' mental and physical well-being and
the health and safety of our employees and service providers remains a top
priority with regular seminars and webinars from external experts.
Climate change
Risk Impact on Strategy Mitigation
Physical impact to the Group's assets from rising temperatures or other Reduced income, capital values or business disruption resulting from physical Active management of climate-related risks and opportunities, supported by a
extreme climate-related event such as flooding climate events dedicated sustainability team
Transitional challenge of increasing and more onerous climate-related Increased operating costs associated with compliance, reporting and achieving We have set a 2040 Net Zero Carbon target to align with the Science Based
regulation, compliance and reporting requirements target environmental metrics Targets initiative long-term carbon reduction targets. For more detail on the
mitigation measures in place for climate risk, please refer to the Group's
The cost, complexity and feasibility of retrofitting, insuring or leasing Increased capital costs of retrofitting, or inability to resolve listed TCFD disclosures in the 2025 Annual Report as well as the Group's Net Zero
heritage assets and listed buildings on a whole life carbon basis building or planning challenges, leads to buildings becoming "carbon stranded" Carbon Pathway.
Failure to progress cost-effective retrofit pathways for heritage assets may Reduced rental income through lower rents and longer void periods due to External reporting and performance monitoring through recognised indices and
reduce lettability, ERVs, and exit liquidity risk reduced customer demand for less sustainable buildings benchmarks, including EPRA, CDP, MSCI and GRESB
Inability to keep pace with customer and consumer demand for proactive action Continued engagement with stakeholders to preserve heritage buildings, while
to manage and mitigate climate-related risk enhancing environmental performance
Pro-active customer and consumer engagement programme and setting of
appropriate climate-related targets on both development and operations
Change in 2025: Stable
Context and actions taken:
The Group believes in taking a responsible and forward-looking approach to
environmental issues sustainability and recognises the urgent need to tackle
climate change. The Group is committed to meeting our 2030 carbon reduction
targets and 2040 Net Zero Carbon target. As a long-term steward of the West
End, the Group recognised the importance of preserving and celebrating the
area's heritage through carefully considered refurbishments and developments.
The Group has made material progress in the decarbonisation of the portfolio
and recognises that it is at acritical point for action and will continue our
efforts in 2026 to reduce greenhouse gas emissions in our buildings and
operations. This requires more innovative and sustainable ways of working and
includes supply chain partners across development and operational disciplines,
customers, as well as corporate actions.
Compliance with law and regulations
Risk Impact on Strategy Mitigation
Breach of legislation, regulation or contractual obligations, including Prosecution for non-compliance with legislation or regulation Appointment of external advisers to monitor changes in law or regulation
shareholders agreement with joint venture partners
Litigation or fines and associated reputational damage Employees attend external briefings to remain cognisant of legislative and
Failure to anticipate, respond to or comply with changes in legal or
regulatory changes
regulatory requirements, including potential reforms to the Landlord and Distraction of management from strategic objectives
Tenant Act or other property related legislation
Governance frameworks within joint venture agreements with regular
Adverse financial consequences, including potential loss of REIT tax benefits communication with partners
Health and Safety incidents, including accidents or near misses, causing loss
of life or very serious injury to employees, contractors, customers or Robust health and safety policies, procedures, training and governance
visitors frameworks across the Group
Loss of REIT status due to non-compliance with REIT requirements Appointment of reputable and competent contractors
Added complexity of reporting requirements because of joint venture Adequate insurance held to cover the risks inherent in property ownership,
arrangements management and construction projects
Change in 2025: Stable
Context and actions taken:
Compliance with law and regulations, including health and safety, remains a
key priority for the Board.
Protocols are in place and communicated across the various stakeholder groups
to ensure awareness of, and compliance with, new legislation and requirements.
The health and safety of our people and the public is a key priority. The
Group works closely with its stakeholders to mitigate health and safety risks.
The Group remains in ongoing communication with HMRC regarding its REIT
status, its compliance with the requirements and HMRC's approach in the event
of any potential breach of the REIT conditions.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The statement of Directors' responsibilities below has been prepared in
connection with the Group's full Annual Report for the year ended 31 December
2025. Certain parts of the Annual Report have not been included in this
announcement as set out in Note 1 to the condensed financial information.
The Directors consider that the Annual Report, taken as a whole, is fair,
balanced and understandable and provides the information necessary for
shareholders to assess the Group's position and performance, business model
and strategy.
Each of the Directors, whose names and functions are listed in the Governance
section of the Annual Report confirm that, to the best of their knowledge:
· the Group financial statements, which have been prepared in
accordance with UK-adopted international accounting standards, give a true and
fair view of the assets, liabilities, financial position and profit of the
Group;
· the Strategic Report includes a fair review of the development and
performance of the business and the position of the Group, together with a
description of the principal risks and uncertainties that it faces.
The responsibility statement was approved by the Board of Directors on 24
February 2026 and signed on its behalf by:
Ian Hawksworth
Chief Executive
24 February 2026
Situl Jobanputra
Chief Financial Officer
24 February 2026
CONSOLIDATED INCOME STATEMENT
For the year ended 31 December 2025
Note 2025 2024
£m
£m
Revenue 4 238.9 227.1
Costs 4 (61.2) (60.0)
Gross profit 4 177.7 167.1
Other income 3.0 -
Administration expenses 5 (50.2) (42.7)
Gain on revaluation and sale of investment property 321.8 194.6
Change in value of investments and other receivables (6.5) (7.0)
Operating profit 445.8 312.0
Finance income 6 20.5 14.8
Finance costs 7 (63.8) (72.0)
Other finance income 6 4.0 4.5
Other finance costs 7 (9.7) (6.5)
Change in fair value of derivative financial instruments (3.0) (0.9)
Net finance costs (52.0) (60.1)
Net profit from joint ventures and associates 11 - 0.5
Loss on sale of investments and subsidiaries 12 (6.7) -
Profit before tax 387.1 252.4
Taxation 8 0.3 (0.3)
Profit for the year 387.4 252.1
Profit attributable to:
Owners of the Parent 340.2 252.1
Non-controlling interest 12 47.2 -
Earnings per share attributable to owners of the Parent:
Basic earnings per share 3 18.7p 13.8p
Diluted earnings per share 3 18.5p 13.8p
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2025
Note 2025 2024
£m
£m
Profit for the year 387.4 252.1
Other comprehensive income
Items that will not be reclassified to profit or loss:
Revaluation gain/(loss) on owner-occupied property 0.6 (0.1)
Total comprehensive income for the year 388.0 252.0
Total comprehensive income attributable to:
Owners of the Parent 340.8 252.0
Non-controlling interest 12 47.2 -
CONSOLIDATED BALANCE SHEET
As at 31 December 2025
Note 2025 2024
£m
£m
Non-current assets
Investment property 10 5,337.3 4,899.1
Property, plant and equipment 25.2 25.5
Trade and other receivables 13 113.8 139.7
5,476.3 5,064.3
Current assets
Trade and other receivables 13 41.3 30.4
Derivative financial instruments 1.6 3.4
Tax receivable 0.3 -
Cash and cash equivalents 14 361.4 124.0
404.6 157.8
Assets held for sale
Investment property held for sale 10 - 9.8
- 9.8
Total assets 5,880.9 5,231.9
Non-current liabilities
Borrowings 15 (772.4) (1,467.8)
Lease liabilities (2.3) (2.7)
Derivative financial instruments - (1.8)
(774.7) (1,472.3)
Current liabilities
Borrowings 15 (438.4) -
Lease liabilities (0.3) (0.3)
Tax liabilities - (0.2)
Derivative financial instruments (1.3) -
Trade and other payables (98.1) (84.8)
(538.1) (85.3)
Total liabilities (1,312.8) (1,557.6)
Net assets 4,568.1 3,674.3
Equity
Share capital 17 488.2 488.2
Other components of equity 3,466.0 3,186.1
Equity attributable to owners of the Parent 3,954.2 3,674.3
Non-controlling interest 12 613.9 -
Total equity 4,568.1 3,674.3
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2025
Note Share-based payments reserve Non-controlling interest Total equity
£m
Share Share Merger Other Retained Total £m £m
capital
premium
reserves(2)
earnings
£m
£m
£m reserve(1)
£m
£m
£m
At 1 January 2025 488.2 232.5 1,256.0 4.4 (31.6) 1,724.8 3,674.3 - 3,674.3
Profit for the year - - - - - 340.2 340.2 47.2 387.4
Other comprehensive income for the year - - - - - 0.6 0.6 - 0.6
Total comprehensive income for the year - - - - - 340.8 340.8 47.2 388.0
Contribution from non-controlling interest 12 - - - - - - - 574.6 574.6
Dividends(3) 9 - - - - - (67.5) (67.5) (7.9) (75.4)
Fair value of share-based payments - - - 6.5 - - 6.5 - 6.5
Realisation of cash flow hedge - - - - 0.1 - 0.1 - 0.1
Balance at 31 December 2025 488.2 232.5 1,256.0 10.9 (31.5) 1,998.1 3,954.2 613.9 4,568.1
1. Represents non-qualifying consideration received following previous share
placings and the all-share merger with Shaftesbury PLC in March 2023. The
amounts taken to the merger reserve do not currently meet the criteria for
qualifying consideration and therefore will not form part of distributable
reserves as they form part of linked transactions.
2. Other reserves represent own shares of £32.9 million and cash flow hedge
reserve of £0.1m offset by a capital redemption reserve of £1.5 million. Own
shares represent the nominal value of 128,350,793 shares issued to a
controlled entity, of which 127,008,786 shares are held as collateral for the
exchangeable bond, and 3,146,886 shares held by the Group's Employee Benefit
Trust in respect of employee share awards.
3. Excludes £4.7 million paid to a controlled entity, Capco Investment
London (No.7) Scottish Limited Partnership, in respect of 128,350,793 shares,
of which 127,008,786 are held as collateral for the exchangeable bond. The
entity has provided an undertaking not to exercise its voting rights in
respect of such ordinary shares but has received its dividend, all of which
was retained by the Group following calculation of the dividend threshold test
as set out in the exchangeable bond conditions.
For year ended 31 December 2024
Note Share-based payments reserve Non-controlling interest Total equity
£m
Share Share Merger Other Retained Total £m £m
capital
premium
reserves(2)
earnings
£m
£m
£m reserve(1)
£m
£m
£m
At 1 January 2024 488.2 232.5 1,256.0 1.3 (31.7) 1,533.9 3,480.2 - 3,480.2
Profit for the year - - - - - 252.1 252.1 - 252.1
Other comprehensive expense for the year - - - - - (0.1) (0.1) - (0.1)
Total comprehensive income for the year - - - - - 252.0 252.0 - 252.0
Dividends(3) 9 - - - - - (61.1) (61.1) - (61.1)
Fair value of share-based payments - - - 3.1 - - 3.1 - 3.1
Realisation of cash flow hedge - - - - 0.1 - 0.1 - 0.1
Balance at 31 December 2024 488.2 232.5 1,256.0 4.4 (31.6) 1,724.8 3,674.3 - 3,674.3
1. Represents non-qualifying consideration received following previous share
placings and the all-share merger with Shaftesbury PLC completed in March
2023. The amounts taken to the merger reserve do not currently meet the
criteria for qualifying consideration and therefore will not form part of
distributable reserves as they form part of linked transactions.
2. Other reserves represent own shares of £32.9 million and cash flow hedge
reserve of £0.2m offset by a capital redemption reserve of £1.5 million. Own
shares represent the nominal value of 128,350,793 shares issued to a
controlled entity, of which 127,008,786 are held as collateral for the
exchangeable bond, and 3,146,886 shares held by the Group's Employee Benefit
Trust in respect of employee share awards.
3. Excludes £4.3 million paid to a controlled entity, Capco Investment
London (No.7) Scottish Limited Partnership, in respect of 128,350,793 shares,
of which 127,008,786 are held as collateral for the exchangeable bond. The
entity has provided an undertaking not to exercise its voting rights in
respect of such ordinary shares but has received its dividend, all of which
was retained by the Group following calculation of the dividend threshold test
as set out in the exchangeable bond conditions.
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 December 2025
Note 2025 2024
£m
£m
Cash flows from operating activities
Cash generated from operations 20 161.2 108.7
Finance costs paid (65.1) (72.0)
Interest received 20.3 15.0
Net cash inflow from operating activities 116.4 51.7
Cash flows from investing activities
Purchase and development of property (120.4) (130.4)
Purchase of fixed assets - (2.3)
Sale of property 9.4 136.6
Dividends received from associate - 1.2
Sale of associate - 82.5
Loans to joint ventures and associate's repayment received - 15.6
Net cash (outflow)/inflow from investing activities (111.0) 103.2
Cash flows from financing activities
Borrowings repaid (292.4) (305.0)
Borrowings drawn 25.0 135.0
Gross proceeds from disposal of 25 per cent interest in Group subsidiaries 574.0 -
Cash dividend paid to owners of the Parent 9 (66.7) (61.1)
Cash dividends paid to non-controlling interest 12 (7.9) -
Net cash inflow/(outflow) from financing activities 232.0 (231.1)
Net movement in cash and cash equivalents 237.4 (76.2)
Cash and cash equivalents at 1 January 124.0 200.2
Cash and cash equivalents 31 December 14 361.4 124.0
NOTES TO THE ACCOUNTS
1 PRINCIPAL ACCOUNTING POLICIES
General Information
Shaftesbury Capital PLC (the "Company") was incorporated and registered in
England and Wales and domiciled in the United Kingdom on 3 February 2010 under
the Companies Act 2006 as a public company limited by shares, registration
number 7145051. The registered office of the Company is Regal House, 14 James
Street, London, WC2E 8BU, United Kingdom. The principal activity of the
Company is to act as the ultimate parent company of Shaftesbury Capital PLC
Group (the "Group"), whose principal activity is the investment and management
of property.
The Group's assets principally comprise investment property within the West
End of London, including Covent Garden, Carnaby, Soho and Chinatown.
Basis of preparation
The financial information set out in this announcement has been extracted from
the Company's consolidated financial statements for the year ended 31 December
2025 and does not constitute statutory accounts within the meaning of section
434 of the Companies Act 2006.
The consolidated financial statements and this announcement were approved by
the Board of Directors on 24 February 2026. The auditors have reported on the
consolidated financial statements for the year ended 31 December 2025 under
section 495 of the Companies Act 2006. The auditors' report is unqualified and
does not contain a statement under section 498(2) or (3) of the Companies Act
2006. The Company's statutory financial statements for the year ended 31
December 2024 have been filed with the Registrar of Companies and those for
the year ended 31 December 2025 will be filed following the Company's Annual
General Meeting.
The Group's consolidated financial statements are prepared in accordance with
United Kingdom-adopted international financial accounting standards
("UK-adopted IFRS" or "IFRS"), and the applicable legal requirements of the
Companies Act 2006. While the financial information included in this
preliminary announcement has been prepared in accordance with the recognition
and measurement criteria of international accounting standards ("IAS") in
conformity with the requirements of the Companies Act 2006 and UK-adopted IFRS
and complies with the disclosure requirements of the Listing Rules of the UK
Financial Conduct Authority, this announcement does not itself contain
sufficient information to comply with IASs and IFRSs. The Group expects to
publish full financial statements that comply with IFRS in March 2026.
The consolidated financial statements have been prepared on a going concern
basis under the historical cost convention as modified for the revaluation of
property and derivative financial instruments.
The accounting policies used by the Group in these consolidated financial
statements are consistent with those applied in the Shaftesbury Capital
financial statements for the year to 31 December 2024, as amended to reflect
the adoption of new standards, amendments and interpretations which became
effective in the year.
Going concern
The Directors have considered the appropriateness of adopting the going
concern basis in preparing the consolidated financial statements. The Group's
going concern assessment covers the period to 30 June 2027 (the "going concern
period"), being at least 12 months from the date of authorisation of these
consolidated financial statements.
Our West End portfolio continues to demonstrate its enduring appeal with
positive trends in footfall and sales, high occupancy and overall leasing
activity levels well ahead of ERV. Occupational demand across all uses is
delivering rental income evaluation growth. While there continue to be
macroeconomic uncertainties and geopolitical risks, our customers continue to
recognise the exceptional features of London's West End.
There is significant headroom against debt covenants and access to significant
liquidity.
In preparing the assessment of going concern, the Directors have considered
projections of the Group's liquidity, committed capital expenditure, income,
costs, cash flows and debt covenants.
The Directors have assessed a base case and a downside scenario (being a
"severe but plausible" scenario).
As at year end, the Group had net debt of £0.8 billion, an EPRA LTV ratio of
17 per cent and Group interest cover of 4.0 times. The Group is projected to
have sufficient cash reserves and undrawn facilities to meet debt maturities
during the going concern period. Drawn debt is at fixed rates or currently has
interest rate protection in place.
The Group's debt matures between March 2026 and 2037. Debt maturities during
the going concern assessment period relate to the £275 million exchangeable
bond, and £162.5 million of private placement loan notes, both of which can
be repaid through existing cash resources or undrawn facilities of
approximately £1.0 billion in both the base case and the downside scenario.
The Group's financial resources are expected to be sufficient to cover its
commitments over the going concern period.
Relative to the Group's base case forecast, the downside scenario includes the
following key assumptions:
Substantial reduction in forecast rental income due to a combination of
extended voids and tenant failures;
Elevated interest rates in excess of current market expectations; and
Declines in rental values, along with a widening of valuation yields,
resulting in reduced asset values.
The near-term impact of climate change risks within the going concern period
has been considered in the downside scenario and is expected to be immaterial.
Under the downside scenario, the Group is expected to remain in compliance
with all financial covenants of its debt arrangements.
In addition to considering a downside scenario, the Board has undertaken
reverse stress testing, which indicates that the Group could withstand a
decrease of approximately 52 per cent in valuations and 49 per cent in income
before breaching its debt financial covenants.
Based on their analysis, the Directors are satisfied that there is a
reasonable expectation that the Group will be able to meet its ongoing and
future commitments for at least 12 months from the date of approval of the
consolidated financial statements and have therefore resolved that the Group's
consolidated financial statements be prepared on a going concern basis.
Critical accounting judgments and key sources of estimation and uncertainty
The preparation of consolidated financial statements in accordance with IFRS
requires the Directors to make judgements, estimates and assumptions that
affect the reported amounts of assets, liabilities, equity, income and
expenses from sources not readily apparent. Although these estimates and
assumptions are based on management's best knowledge of the amount, historical
experiences and other factors, actual results ultimately may differ from those
estimates. The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the period in which
the estimate is revised if the revision affects only that period.
The most significant area of estimation uncertainty is in respect of the
valuation of the property portfolio where external valuations are obtained.
The fair value of the Group's investment and trading property (trading
property included within the Lillie Square joint venture) at 31 December 2025
was determined by independent, appropriately qualified external valuers CBRE
and Cushman & Wakefield for the property portfolio under management, and
JLL for the Lillie Square joint venture. The valuations conform to the Royal
Institution of Chartered Surveyors ("RICS") Valuation Professional Standards.
As various inputs used in the valuation calculations are based on assumptions,
property valuations are inherently subjective and subject to a degree of
estimation uncertainty. The Group's external valuers have made a number of
assumptions including, but not limited to, market yields, ERVs and void
periods. These assumptions are in accordance with the RICS Valuation
Professional Standards, however, if any prove to be incorrect, it may mean
that the value of the Group's properties differs from their valuation reported
in the financial statements, which could have a material effect on the Group's
financial position. The key unobservable inputs used in the valuation models
are those in respect of equivalent yields and ERV, which are summarised within
note 10 'Property portfolio' and additional information is provided on page
54. Further information on the approach taken by the valuers in valuing the
property portfolio and a sensitivity analysis on equivalent yields and ERV,
which are the most significant assumptions impacting the fair values, is set
out in note 10 'Property portfolio'.
Other areas of judgement and estimation in the financial statements (which are
not considered critical) include accounting for non-controlling interest, REIT
compliance, the impairment of and expected credit loss allowance on trade
receivables and share-based payments
New accounting policies
In the current year, the Group has applied the below amendments to IFRS
Standards and Interpretations issued by the International Accounting Standards
Board that are effective for annual periods that begin on or after 1 January
2025.
IAS 21 'The Effects of Changes in Foreign Exchange Rates' (amendment) (Lack of
Exchangeability).
The adoption of the above amendment has not had a material impact on the
amounts reported in the consolidated financial statements or on the
disclosures.
At the date of approval of the consolidated financial statements the following
new accounting standards and amendments to accounting standards were in issue
but are not yet effective. These new standards and amendments have not been
applied in these consolidated financial statements.
· IFRS 9 'Financial Instruments' and IFRS 7 'Financial Instruments:
Disclosures' (amendment) (Classification and Measurement of Financial
Instruments);
· IFRS 9 'Financial Instruments' and IFRS 7 'Financial Instruments:
Disclosures' (amendment) (Contracts Referencing Nature-dependent Electricity);
· IFRS 18 'Presentation and Disclosure in Financial Statements' (new
standard).
The amendments to IFRS 9 and IFRS 7 are effective for annual periods beginning
on or after 1 January 2026. The Group has assessed the impact of these
amendments and does not anticipate any material impact on the consolidated
financial statements.
IFRS 18 is effective for annual periods beginning on or after 1 January 2027.
The Group is assessing the impact of this new standard and the Group's
financial reporting will be presented in accordance with this standard from 1
January 2027, in line with requirements.
Subsidiaries
Subsidiaries are fully consolidated from the date on which the Group has
control, it is exposed, or has rights, to variable returns from its
involvement with an entity and has the ability to affect those returns through
its power over an entity. Subsidiaries cease to be consolidated from the date
this control is lost.
Non-controlling interests are recognised on the basis of their proportionate
share in the recognised amounts of a subsidiary's identifiable net assets. On
the balance sheet, non-controlling interests are presented separately from the
equity of the owners of the Parent. Profit or loss and total comprehensive
income for the period attributable to non-controlling interests are presented
separately in the income statement and the statement of comprehensive income.
2 SEGMENTAL REPORTING
The Group's operating segments are established on the basis of information
evaluated and regularly reviewed in decisions on how to allocate resources and
assess performance by the chief operating decision maker ("CODM"). IFRS 8
requires operating segments to be reported in a manner consistent with the
internal financial reporting reviewed by the CODM. The Group has determined
the CODM to be the Executive Committee.
The principal activity of the Group is the investment in property to earn
income and generate long-term capital returns. The Group operates primarily
within the West End of London.
The performance of the Group is assessed based on the key performance
indicators, which are the IFRS, EPRA and underlying performance measures.
Following completion of the long-term partnership with NBIM on 1 April 2025,
the Group has reassessed the way it evaluates performance. Effective from 1
April 2025, reporting on the performance of the Covent Garden segment is
presented separately to the CODM. As such the Covent Garden segment has become
a separate reporting segment from 1 April 2025 with prior year comparatives
presented by segment.
For the remainder of the portfolio there has been no change in the way
information is reported to the CODM. The allocation of funding and management
of overheads and financing continues to be determined at an overall Group
level as the Group continues to look to maximise the potential from investment
opportunities across the whole of the portfolio and investment opportunities
continue to be assessed on a building-by-building basis.
The CODM reviews information on a segmental basis for gross profit and market
value of property portfolio only. No other assets or liabilities are monitored
by segment.
Gross profit
2025 2024
Covent Garden Other Total Covent Garden Other Total
£m £m £m £m £m £m
Revenue(1) 108.9 107.4 216.3 102.4 102.6 205.0
Costs(1) (20.3) (18.3) (38.6) (20.4) (17.5) (37.9)
Gross profit per consolidated income statement 88.6 89.1 177.7 82.0 85.1 167.1
Attributable to non-controlling interest (16.6) - (16.6) - - -
Gross profit - Group share 72.0 89.1 161.1 82.0 85.1 167.1
1. Revenue and costs exclude service charge income and expenses of £22.6
million (31 December 2024: £22.1 million).
Market value of property portfolio
2025 2024
Covent Garden Other Total Covent Garden Other Total
£m £m £m £m £m £m
Market value of property portfolio under management(1) 2,825.5 2,581.6 5,407.1 2,652.7 2,320.8 4,973.5
Attributable to non-controlling interest (706.4) - (706.4) - - -
Market value of property portfolio - Group share 2,119.1 2,581.6 4,700.7 2,652.7 2.320.8 4,973.5
1. Refer to note 10 'Property portfolio' for a reconciliation to carrying
value of property portfolio per the consolidated balance sheet.
3 PERFORMANCE MEASURES
The Group has applied the European Securities and Markets Authority guidelines
on alternative performance measures ("APMs") in these annual results. An APM
is a financial measure of historical or future financial performance, position
or cash flow of the Group which is not a measure defined or specified in IFRS.
Details of all APMs used by the Group are set out in the APM section on page
46.
As is usual practice in the sector, the Group presents APMs for certain
indicators, including earnings, earnings per share and net tangible assets,
making adjustments as set out by EPRA in its Best Practice Recommendations.
These recommendations are designed to make the financial statements of public
real estate companies more comparable across Europe, enhancing the
transparency, comparability and coherence of the sector.
A summary of the number of shares, on a basic and diluted basis, in issue at
year end, and on a weighted average basis for the year, is set out in the
table below:
Number of shares
2025 2025 2024 2024
Weighted average In issue Weighted average In issue
million
million
million million
Ordinary shares 1,953.2 1,953.2 1,953.2 1,953.2
Own shares - Employee Benefit Trust (3.1) (3.1) (3.1) (3.1)
Own shares - exchangeable bond(1) (128.4) (128.4) (128.4) (128.4)
Number of shares - basic(2) 1,821.7 1,821.7 1,821.7 1,821.7
Dilutive effect of contingently issuable share option awards 14.2 18.4 5.7 10.0
Dilutive effect of contingently issuable deferred share awards 1.5 2.2 0.7 1.6
Number of shares - diluted(3) 1,837.4 1,842.3 1,828.1 1,833.3
1. Includes 127,008,786 shares held as collateral for the exchangeable bond.
2. Weighted average number of ordinary shares used as the denominator in
calculating basic earnings per share.
3. Weighted average number of ordinary shares and potential ordinary shares
used as the denominator in calculating diluted earnings and net assets per
share.
Earnings per share - IFRS
2025 2024
£m
£m
Basic earnings attributable to owners of the Parent 340.2 252.1
Basic earnings per share 18.7p 13.8p
Diluted earnings per share 18.5p 13.8p
Headline earnings per share
Headline earnings per share is calculated in accordance with Circular 1/2023
issued by the South African Institute of Chartered Accountants, a requirement
of the Group's Johannesburg Stock Exchange secondary listing. This measure is
not a requirement of IFRS.
2025 2024
£m
£m
Basic earnings attributable to owners of the Parent 340.2 252.1
Group adjustments:
Loss on sale of associate - 4.0
Loss on sale of investments and subsidiaries 6.7 -
Gain on revaluation and sale of investment property(1) (286.1) (194.6)
Headline earnings 60.8 61.5
Basic and diluted headline earnings per share (pence) 3.3p 3.4p
1. Excludes gain on revaluation of investment property attributable to
non-controlling interest of £35.7 million (31 December 2024: nil).
One of the key performance measures which the Group uses is underlying
earnings. The underlying earnings measure reflects the underlying financial
performance of the Group's West End property rental business and is used for
the calculation of dividends. The measure aligns with the main principles of
EPRA earnings. EPRA earnings excludes valuation movements and profit or loss
on disposal of investment properties, fair value changes of financial
instruments, cost of early close out of debt, certain allowable non-operating
and exceptional items and the amounts allocated to non-controlling interest in
respect of these.
The non-operating and exceptional items adjusted for by the Group in the
current and prior year include non-recurring corporate and transaction costs.
These costs are considered non-recurring as they relate to significant
transactions outside the ongoing operations of the Group. Other exceptional
items adjusted for include the fair value movements of the option component of
the exchangeable bond, and following the completion of the all-share merger in
March 2023, the unwinding of the IFRS 3 fair value of debt.
In calculating underlying earnings in both years, additional adjustments are
made to exclude the financial performance of the Lillie Square joint venture,
associated tax adjustments and the interest receivable on the loan issued to
the joint venture by the Group. Lillie Square is not considered to be a core
part of the operations of the Group and therefore its results are not included
in underlying earnings.
Earnings per share - EPRA and Underlying
Note 2025 2024
£m
£m
Basic earnings 387.4 252.1
Basic earnings attributable to non-controlling interest 12 (47.2) -
Basic earnings attributable to owners of the Parent 340.2 252.1
EPRA Group adjustments:
Gain on revaluation and sale of investment property(1) (286.1) (194.6)
Change in value of investments and other receivables 6.5 7.0
Change in fair value of derivative financial instruments - interest rate 3.5 6.3
derivatives
Fair value acceleration and costs associated with early close out of debt 7 4.1 1.0
Loss on sale of investments and subsidiaries 12 6.7 -
Loss on sale of associate - 4.0
EPRA non-operating and exceptional items:
Non-underlying administration expenses 5 5.9 3.3
Change in fair value of financial instruments - exchangeable bond option (0.5) (5.4)
Other exceptional finance items(2) 5.4 5.8
EPRA joint venture and associate adjustments:
Adjustments in respect of joint ventures and associate 2.9 (4.2)
EPRA earnings 88.6 75.3
EPRA earnings per share (pence) 4.9 4.1
Underlying earnings adjustments:
Joint ventures adjustment - Lillie Square(3) (6.7) (2.3)
Underlying earnings 81.9 73.0
Underlying earnings per share (pence) 4.5 4.0
1. Excludes gain on revaluation of investment property attributable to
non-controlling interest of £37.5 million (31 December 2024: nil).
2. Other exceptional finance items consists of £4.9 million (31 December
2024: £6.1 million) IFRS 3 fair value of debt unwind, exceptional legal fees
and non-underlying finance income of £0.5 million (31 December 2024: £0.3
million offset).
3. The Lillie Square joint venture is not considered part of the core
underlying business of the Group and therefore its results are excluded from
underlying earnings. The adjustment includes £3.8 million (31 December 2024:
£3.8 million) interest receivable by the Group on the interest-bearing loans
issued to the joint venture and £2.9 million (31 December 2024: £1.5 million
offset) of adjustments made to EPRA earnings for profit on sale and transfer
of trading property, loss on revaluation of investment property and write down
of trading property.
Net assets per share
2025 2024
EPRA NRV EPRA NTA EPRA NDV EPRA NRV EPRA NTA EPRA NDV
£m
£m
£m
£m
£m
£m
Equity attributable to owners of the Parent(1) 3,954.2 3,954.2 3,954.2 3,674.3 3,674.3 3,674.3
Unrecognised surplus on trading property - joint venture 0.1 0.1 0.1 0.1 0.1 0.1
Fair value of financial instruments - interest rate derivatives (1.6) (1.6) - (3.4) (3.4) -
Fair value adjustment of exchangeable bond(2) 2.2 2.2 - (0.4) (0.4) -
Real Estate Transfer Tax 316.1 - - 333.1 - -
Adjustment of fixed rate debt from carrying value to fair value(3) - - 5.1 - - 50.8
Deferred tax adjustments - - - 0.5 0.5 -
NAV 4,271.0 3,954.9 3,959.4 4,004.2 3,671.1 3,725.2
NAV per share (pence) 231.8p 214.7p 214.9p 218.4p 200.2p 203.2p
1. IFRS total equity attributable to owners of the Parent of 214.6 pence per
share (31 December 2024: 200.4 pence per share).
2. Adjustment to remove the exchangeable bond option fair value and include
the exchangeable bond liability at nominal value of £275 million.
3. Excludes the fair value of exchangeable bond option component included
under derivative liabilities.
4 GROSS PROFIT
2025 2024
£m
£m
Rental receivable 212.7 197.2
Straight-lining of tenant lease incentives 3.6 7.8
Service charge income 22.6 22.1
Revenue 238.9 227.1
Property expenses (33.7) (33.1)
Provision for expected credit loss (3.3) (3.9)
Tenant lease incentives written off (1.6) (0.9)
Service charge expenses (22.6) (22.1)
Costs (61.2) (60.0)
Gross profit 177.7 167.1
All revenue has been generated from operations within the United Kingdom.
5 ADMINISTRATION EXPENSES
2025 2024
£m
£m
Depreciation 0.2 0.3
Employee costs 20.7 19.9
Share option charge 7.7 3.1
Head office administration expenses 15.7 16.1
Non-underlying administration expenses(1) 5.9 3.3
Administration expenses 50.2 42.7
1. Non-underlying administration expenses relate to non-recurring corporate
and transaction-related costs.
6 FINANCE INCOME
2025 2024
£m
£m
Finance income:
On deposits and current accounts 17.3 5.0
On interest rate derivatives 3.2 9.8
Finance income 20.5 14.8
Other finance income:
On loans to joint ventures and associates 3.8 4.2
Non-underlying finance income 0.2 0.3
Other finance income 4.0 4.5
7 FINANCE COSTS
2025 2024
£m
£m
On bank facilities and loan notes 29.8 35.8
On exchangeable bond(1) 8.6 8.5
On secured loans 25.1 27.4
On obligations under lease liabilities 0.3 0.3
Finance costs 63.8 72.0
Other finance costs:
Non-underlying finance charges(2) 9.7 6.5
Other finance costs 9.7 6.5
1. On 30 November 2020 the Group issued £275 million of secured
exchangeable bond maturing in March 2026. The net proceeds received from the
issue of the exchangeable bond have been split between the financial liability
element and an option component. The debt component is accounted for at
amortised cost and, after taking into account transaction costs, accrues
interest at an effective interest rate of 3.1 per cent, of which 2 per cent
(£5.5 million) represents the cash coupon on the bond.
2. Non-underlying finance charges have been excluded from the calculation of
underlying earnings as these are non-recurring costs and do not represent the
underlying performance of the business. These finance charges include £4.9
million (31 December 2024: £5.5 million) IFRS 3 fair value of debt unwind,
£2.7 million (31 December 2024: nil) accelerated fair value unwind and £2.1
million (31 December 2024: £1.0 million) costs associated with early close
out of debt and exceptional legal fees.
8 TAXATION
2025 2024
£m
£m
Current income tax:
Current income tax charge - 0.5
Adjustments in respect of previous years (0.3) (0.2)
Current tax on profits (0.3) 0.3
Deferred income tax:
On accelerated capital allowances (0.5) -
On Group losses (1.6) 0.9
On other temporary differences 2.1 (0.9)
Deferred tax on profits - -
Total taxation (credit)/charge in the consolidated income statement (0.3) 0.3
As a UK REIT, the Group is exempt from UK corporation tax on income and gains
from qualifying activities. Non-qualifying activities are subject to UK
corporation tax.
9 DIVIDENDS
PID Non-PID Date paid 2025 2024
£m
£m
Pence per share
Ordinary shares
For year ended 31 December 2023:
Final dividend of 1.65 pence per share 0.65 1.0 31 May 2024 - 32.2
For year ended 31 December 2024:
Interim cash dividend of 1.7 pence per share 1.0 0.7 1 October 2024 - 33.2
Final dividend of 1.8 pence per share 1.8 - 30 May 2025 35.2 -
For the year ended 31 December 2025:
Interim dividend of 1.9 pence per share 1.5 0.4 1 October 2025 37.0 -
Dividend expense(1) 72.2 65.4
1. Includes £4.7 million (31 December 2024: £4.3 million) paid to a
controlled entity, Capco Investment London (No.7) Scottish Limited
Partnership, in respect of 128,350,793 shares, of which 127,008,786 are held
as collateral for the exchangeable bond. The entity has provided an
undertaking not to exercise its voting rights in respect of such ordinary
shares but has received its dividend, all of which was retained by the Group
following calculation of the dividend threshold test as set out in the
exchangeable bond conditions. The Group's dividend expense recorded in the
consolidated statement of cash flows is £66.7 million (31 December 2024:
£61.1 million), which includes a £0.8 million adjustment for dividend
withholding tax not yet paid at year end.
As a UK REIT, Shaftesbury Capital is required to distribute at least 90 per
cent of the Group's income profits from its tax-exempt property rental
business, and 100 per cent of the Group's UK REIT investment profits, by way
of a PID.
These distributions can be subject to withholding tax at 20 per cent.
Dividends from profits of the Group's taxable residual business are ordinary
dividends and will be taxed as an ordinary dividend.
On 24 February 2026, the Directors proposed a final cash dividend for 2025 of
2.1 pence per ordinary share which will be paid wholly as a PID. The final
cash dividend will be paid on 22 May 2026 to all shareholders on the register
on 24 April 2026.
10 PROPERTY PORTFOLIO
Carrying value of property portfolio
2025 2024
£m
£m
Carrying value of investment property at 1 January 4,899.1 4,740.2
Carrying value of investment property held for sale at 1 January 9.8 -
Carrying value at 1 January 4,908.9 4,740.2
Additions from acquisitions 85.4 84.9
Additions from subsequent expenditure 33.1 43.1
Disposals(1) (12.8) (162.2)
Gain on revaluation 322.7 202.9
Transfer to held for sale(1) - (9.8)
Carrying value of investment property 5,337.3 4,899.1
Adjustment in respect of fixed head leases (2.6) (3.0)
Adjustment in respect of tenant lease incentives and deferred letting fees 51.7 47.5
Market value of investment property 5,386.4 4,943.6
The investment property valuation comprises:
Freehold properties 4,248.6 3,849.0
Leasehold properties 1,137.8 1,094.6
Market value of investment property 5,386.4 4,943.6
1. At 31 December 2024, two properties had exchanged for sale and were
accordingly classified as held for sale. Both transactions have subsequently
completed and are included in the disposals value of £12.8 million for the
current year.
Valuation process
The fair value of the Group's investment property and owner-occupied property
at 31 December 2025 was determined by independent, appropriately qualified
external valuers, CBRE and Cushman & Wakefield. The valuations conform to
the Royal Institution of Chartered Surveyors ("RICS") Valuation Professional
Standards. Fees paid to valuers are based on fixed price contracts.
Each period the Company appoints the external valuers. The valuers are
selected based on their knowledge, independence and reputation for valuing
assets such as those held by the Group.
Valuations are performed bi-annually and are performed consistently across all
properties in the Group's portfolio. At each reporting date, appropriately
qualified employees of the Group verify all significant inputs and review
computational outputs. Valuers submit and present summary reports to the
Group's Audit Committee, with the Executive Committee reporting to the Board
on the outcome of each valuation round.
Market value of property portfolio
2025 2024
£m
£m
Market value of investment property 5,386.4 4,943.6
Market value of investment property held for sale - 9.8
Market value of owner-occupied property 20.7 20.1
Market value of property portfolio under management 5,407.1 4,973.5
Market-value of investment property attributable to non-controlling interest (706.4) -
Market value of property portfolio (Group share) 4,700.7 4,973.5
Valuation techniques
Valuations are based on what is determined to be the highest and best use.
When considering the highest and best use a valuer will consider, on a
property-by-property basis, its actual and potential uses which are
physically, legally and financially viable. Where the highest and best use
differs from the existing use, the valuer will consider the cost and the
likelihood of achieving and implementing this change in use in arriving at its
valuation.
The fair value of the Group's investment properties has primarily been
determined using a market approach, which provides an indication of value by
comparing the subject asset with similar assets for which price information is
available. The external valuers use information provided by the Group, such as
tenancy information and capital expenditure expectations. In deriving fair
value, the valuer also makes a series of assumptions, using professional
judgement and market observations. These assumptions include, but are not
limited to, market yields, ERVs and void periods. The critical key assumptions
are the equivalent yields and estimated future rental income (ERVs), as set
out within the table on the next page and within the Analysis of Property
Portfolio on page 54. Equivalent yields are based on current market prices,
depending on, inter alia, the location, condition and use of the properties.
ERVs are calculated using a number of factors which include current rental
income, market comparatives and local occupancy levels. Whilst there is market
evidence for the key inputs, and recent transaction prices for similar
properties, there is still a significant element of estimation and judgement.
As a result of adjustments made to market observable data, these significant
inputs are deemed unobservable.
Non-financial assets carried at fair value, as is the case for investment
property held by the Group, are required to be analysed by level depending on
the valuation method adopted under IFRS 13 'Fair Value Measurement' ("IFRS
13").
Valuation techniques continued
The different valuation levels are defined as:
Level 1: valuation based on quoted market prices traded in active markets;
Level 2: valuation based on inputs other than quoted prices included within
Level 1 that maximise the use of observable data either directly or from
market prices or indirectly derived from market prices; and
Level 3: where one or more inputs to valuation are not based on observable
market data. Valuations at this level are more subjective and therefore more
closely managed, including sensitivity analysis of inputs to valuation models.
When the degree of subjectivity or nature of the measurement inputs changes,
consideration is given as to whether a transfer between fair value levels is
deemed to have occurred. Unobservable data becoming observable market data
would determine a transfer from Level 3 to Level 2. All investment properties
held by the Group are classified as Level 3 in the current and prior year.
The following table sets out the key unobservable inputs used in the valuation
models of the property portfolio under management:
2025 2024
Key unobservable inputs
Range
Range
(weighted average)
(weighted average)
£18-£323 £19-£296
(£92)
Estimated rental value per sq. ft per annum (£98)
Equivalent yield 2.7%-6.8% 2.9%-6.5%
(4.45%)
(4.43%)
Sensitivity to changes in key assumptions
As noted in the critical accounting judgements and key sources of estimation
and uncertainty section in note 1 'Principal accounting policies', the
valuation of the Group's property portfolio is inherently subjective. As a
result, the valuations are subject to a degree of uncertainty and are made on
the basis of assumptions which may not prove to be accurate, particularly in
periods of volatility or low transaction flow in the commercial property
market.
The sensitivity analysis below illustrates the impact on the fair value of the
Group's properties, from changes in the key assumptions:
Change in ERV
-10% -5% +5% +10%
£m £m £m £m
(Decrease)/increase in fair value (436.3) (219.9) 224.4 449.3
Change in Yield
-50bps -25bps +25bps +50bps
£m £m £m £m
Increase/(decrease) in fair value 588.4 273.2 (256.8) (481.6)
The table above shows movements in key assumptions in isolation. These key
unobservable inputs are interdependent. All other factors being equal, a
higher equivalent yield would lead to a decrease in the valuation, and an
increase in estimated rental value would increase the capital value, and vice
versa. However, there are interrelationships between the key unobservable
inputs which are partially determined by market conditions, which would impact
these changes.
At 31 December 2025, the Group was contractually committed to £10.8 million
(31 December 2024: £24.1 million) of future expenditure for the purchase,
development and enhancement of investment property. Refer to note 18 'Capital
commitments' for further information on capital commitments.
Net Zero Carbon and EPC compliance
We are committed to meeting our 2030 carbon reduction targets and have reset
our Net Zero Carbon target to 2040 to align with the Science Based Targets
initiative ("SBTi") long-term carbon reduction targets. A key element in
achieving this will come from carbon efficiencies created through
refurbishments of the Group's property portfolio.
During 2025, the Group's additions from subsequent expenditure were £33.1
million (31 December 2024: £43.1 million). Included within the £33.1 million
total subsequent expenditure is work which related to enhancing the
environmental performance of assets, and design stage work aimed at delivering
environmental enhancements.
We aim for commercial units to have a "B" or above and residential units a "C"
or above rating by 2030. We have already exceeded our interim target of 75
per cent of commercial units having a "B" or above EPC. Any committed capital
expenditure has been included in note 18 'Capital commitments'.
11 INVESTMENTS IN JOINT VENTURES AND ASSOCIATES
Investments in joint ventures and associates are measured using the equity
method. At 31 December 2025, investments comprised of Lillie Square joint
venture ("LSJV"), which is held with other investors on a 50:50 basis. The net
profit from joint ventures and associates of £0.5 million included in the
prior year consolidated income statement consists of £4.5 million share of
profit from Longmartin, offset by a loss on sale on its disposal in October
2024 of £4.0 million.
The table below reconciles the opening to closing carrying value of
investments as presented in the consolidated balance sheet.
Investment in joint ventures and associates Longmartin LSJV Total
£m
£m
£m
At 1 January 2024 83.4 - 83.4
Share of profit/(loss) for the period 4.5 (1.8) 2.7
Losses restricted for the year(1) - 1.8 1.8
Dividend received (1.2) - (1.2)
Disposal of associate (86.7) - (86.7)
At 31 December 2024 - - -
Share of loss for the year - (6.5) (6.5)
Losses restricted for the year(1) - 6.5 6.5
At 31 December 2025 - - -
1. The loss from the Lillie Square joint venture for the year of £6.5
million (31 December 2024: £1.8 million) has been restricted in accordance
with the requirements of IAS 28. Cumulative losses of £46.7 million (31
December 2024: £40.2 million), which exceed the Group's investment in the
joint venture, have been restricted to date and as a result the carrying value
of the investment in LSJV is nil (31 December 2024: nil). The Group holds
£68.2 million (31 December 2024: £70.7 million) of recoverable loans from
LSJV within note 13 'Trade and other receivables'.
LSJV was established as a joint venture arrangement with KFI in August 2012.
The joint venture was established to own, manage and develop land interests at
Lillie Square. LSJV comprises Lillie Square LP, Lillie Square GP Limited,
acting as general partner to the partnership, and its subsidiaries.
All major decisions regarding LSJV are taken by the Board of Lillie Square GP
Limited, through which the Group shares strategic control.
The summarised income statement and balance sheet of LSJV are presented below.
Summarised income statement 2025 2024
£m £m
Revenue 4.3 3.6
Gross profit 1.5 1.3
(Loss)/gain on revaluation, sale and transfer of investment and trading (5.8) 3.0
property
Administration expenses (1.4) (0.7)
Net finance costs(1) (7.3) (7.1)
Loss for the year after taxation (13.0) (3.5)
1. Net finance costs include £7.6 million (31 December 2024: £7.6 million)
interest payable on the interest-bearing loans issued to the joint venture by
the Group and KFI. Finance income receivable by the Group from LSJV of £3.8
million (31 December 2024: £3.8 million) is recognised in the consolidated
income statement within other finance income.
Summarised balance sheet 2025 2024
£m £m
Investment property 84.9 87.4
Other non-current assets 5.4 5.6
Non-current assets 90.3 93.0
Trading property 39.5 42.8
Other current assets 2.9 1.3
Cash and cash equivalents 11.4 9.7
Current assets 53.8 53.8
Amounts payable to joint venture partners(1) (232.6) (224.8)
Other current liabilities (4.5) (2.1)
Current liabilities (237.1) (226.9)
Net liabilities (93.0) (80.1)
Carrying value of investment and trading property 124.4 130.2
Unrecognised surplus on trading property(2) 0.3 0.3
Market value of investment and trading property(2) 124.7 130.5
1. Amounts payable to joint venture partners include working capital
facilities of £29.3 million (31 December 2024: £29.2 million) advanced by
the Group and an interest-bearing loan of £163.0 million (nominal value)
advanced by the Group and KFI. The carrying value of the loan before
impairment, including accrued interest was £187.4 million (31 December 2024:
£179.8 million). Recoverable amounts receivable by the Group, net of
impairments, are recognised on the consolidated balance sheet within
non-current trade and other receivables.
2. The unrecognised surplus on trading property and the market value of
LSJV's property portfolio are shown for informational purposes only and are
not a requirement of IFRS. Trading property continues to be measured at the
lower of cost and net realisable value.
12 NON-CONTROLLING INTEREST
On 1 April 2025, NBIM Mary Limited, a subsidiary of Norges Bank Investment
Management, acquired a 25 per cent non-controlling interest in Covent Garden
Real Estate Holdings Limited ("Covent Garden estate"), a subsidiary of the
Group for a cash consideration of £574.0 million. A loss on sale of £6.7
million, including transaction costs of £6.1 million, has been recorded
within the loss on sale of investments and subsidiaries in the consolidated
income statement.
The principal place of business of Covent Garden Real Estate Holdings Limited
is within the United Kingdom.
The accumulated non-controlling interest is presented below.
2025
£m
At 1 January -
Non-controlling interest's share of net assets acquired 574.6
Profit for the period attributable to non-controlling interest 47.2
Dividends paid to non-controlling interest (7.9)
At 31 December 613.9
The summarised income statement, balance sheet and cash flow statement of the
Covent Garden estate are presented below.
Summarised income statement
1 April 2025 to
31 December 2025
£m
Revenue(1) 83.0
Costs(1) (16.5)
Gross profit 66.5
Gain on revaluation of investment property 142.6
Administrative expenses (13.1)
Net finance costs (7.4)
Income tax 0.3
Profit for the period 188.9
1. Revenue and costs exclude service charge income and expenses of £8.2
million.
Summarised cash flow statement
1 April 2025 to
31 December
2025
£m
Operating cash inflow after interest and tax 44.4
Purchase and development of investment property (15.5)
Cash dividend paid (31.6)
Net cash outflow (2.7)
Summarised balance sheet
2025
£m
Investment property(1) 2,788.6
Other non-current assets 34.2
Non-current assets 2,822.8
Cash and cash equivalents(2) 42.7
Other current assets 26.1
Current assets 68.8
Borrowings, including lease liabilities(3) (217.0)
Non-current liabilities (217.0)
Borrowings, including finance lease liabilities(3) (162.7)
Other current liabilities (56.4)
Current liabilities (219.1)
Net assets 2,455.5
1. The market value of investment property as at 31 December 2025 is
£2,825.5 million.
2. Cash and cash equivalents includes £15.5 million of tenant deposits
which relate to cash held on deposit as security against tenant rent payments
which are subject to certain restrictions and therefore not available for
general use by the Group. In addition, cash deposits against tenants' rent
payment obligations totalling £7.0 million are held in bank accounts
administered by the Group's managing agents which are not included within the
consolidated balance sheet.
3. The nominal value of debt included within borrowings is £380.0 million.
13 TRADE AND OTHER RECEIVABLES
2025 2024
£m
£m
Non-current
Prepayments and accrued income1 39.8 39.9
Amounts receivable from joint ventures(2) 68.2 70.7
Other receivables(3) 5.8 29.1
Trade and other receivables 113.8 139.7
Current
Rent receivable(4) 13.3 9.9
Prepayments and accrued income1 19.9 15.2
Other receivables 8.1 5.3
Trade and other receivables 41.3 30.4
1. Includes tenant lease incentives and deferred letting fees of £51.7
million (31 December 2024: £47.5 million).
2. Amounts receivable from joint ventures represents an interest-bearing
loan of £93.7 million (31 December 2024: £89.9 million) provided to LSJV.
The loan bears interest at 4.25 per cent per annum and is repayable on demand.
As it is not the intention of the Group to call on the loan in the next 12
months it has been presented as non-current. The loan has been impaired by
£25.5 million (31 December 2024: £19.2 million) to date. Included within
current trade and other receivables is working capital of £29.3 million (31
December 2024: £29.2 million) due from LSJV that has been fully impaired.
3. Non-current other receivables include £5.7 million (31 December 2024:
£29.1 million) of restricted cash held on deposit as security for the secured
debt with certain conditions restricting the use.
4. Rent receivable is shown net of an expected credit loss provision of
£4.9 million (31 December 2024: £8.0 million).
14 CASH AND CASH EQUIVALENTS
2025 2024
£m
£m
Cash at hand 1.9 11.7
Cash on short-term deposits 344.0 98.1
Cash 345.9 109.8
Tenant deposits(1) 15.5 14.2
Cash and cash equivalents 361.4 124.0
1. Tenant deposits included above relate to cash held on deposit as security
against tenant rent payments which are subject to certain restrictions and
therefore not available for general use by the Group. The deposits are held in
bank accounts administered by the Group and are therefore included within cash
and cash equivalents in the consolidated balance sheet. In addition, cash
deposits against tenants' rent payment obligations totalling £26.5 million
(31 December 2024: £22.2 million) are held in bank accounts administered by
the Group's managing agents which are not included within the consolidated
balance sheet.
15 BORROWINGS
2025
Carrying Secured Unsecured Fixed Floating Fair Nominal
value
£m
£m
rate
rate
value
value
£m
£m
£m
£m
£m
Current
Loan notes 162.5 - 162.5 162.5 - 160.9 162.5
Exchangeable bonds(1) 275.9 275.9 - 275.9 - 274.2 275.0
438.4 275.9 162.5 438.4 - 435.1 437.5
Non-current
Bank loans 68.7 - 68.7 - 68.7 75.0 75.0
Loan notes 217.1 - 217.1 217.1 - 199.7 217.5
Secured loans 486.6 486.6 - 486.6 - 497.2 517.4
772.4 486.6 285.8 703.7 68.7 771.9 809.9
Total borrowings 1,210.8 1,247.4
Cash, excluding tenant deposits (345.9)
Net debt 901.5
1. Fair value of exchangeable bonds includes the fair value of the option
component of £1.3 million.
2024
Carrying Secured Unsecured Fixed Floating Fair Nominal
value
£m
£m
rate
rate
value
value
£m
£m
£m
£m
£m
Non-current
Bank loans 269.9 - 269.9 - 269.9 269.9 275.0
Loan notes 379.3 - 379.3 379.3 - 341.0 380.0
Secured loans 545.8 545.8 - 545.8 - 544.8 584.8
Exchangeable bonds(1) 272.8 272.8 - 272.8 - 263.1 275.0
1,467.8 818.6 649.2 1,197.9 269.9 1,418.8 1,514.8
Total borrowings 1,467.8 1,514.8
Cash, excluding tenant deposits (109.8)
Net debt 1,405.0
1. Fair value of exchangeable bonds includes the fair value of the option
component of £1.8 million.
£517.4 million (31 December 2024: £584.8 million) (nominal value) of the
Group's borrowings are secured by fixed charges over certain investment
properties held by subsidiaries, with a market value of £1,686.4 million (31
December 2024: £1,681.1 million), and by floating charges over the assets of
certain subsidiaries.
There are currently no restrictions on the remittance of income from
investment properties.
Certain borrowing agreements contain financial and other covenants that, if
contravened, could alter the repayment profile. Details of financial covenants
are included on page 53. The Group has complied with the financial covenants
of all its borrowings during both years presented.
The Group has three revolving credit facilities totalling £750 million, which
are undrawn at 31 December 2025.
Undrawn facilities and cash attributable to the Group, excluding tenant
deposits, at 31 December 2025 were £1,095.9 million (31 December 2024:
£559.8 million).
The fair value of the Group's floating rate borrowings has been estimated
using the market rates, which approximates nominal value, and are classified
as Level 2 fair values as defined by IFRS 13. The fair values of fixed rate
borrowings have been determined by using a discounted cash flow approach,
using a current borrowing rate. The loans are classified as Level 3 fair value
measurements as defined by IFRS 13 due to the use of unobservable inputs,
including own credit risk. The different valuation levels are defined in note
10 'Property portfolio'.
16 CLASSIFICATION OF FINANCIAL ASSETS AND LIABILITIES
The table below sets out each class of financial asset and financial
liability:
2025 2024
Note Carrying (Loss)/gain to Carrying (Loss)/Gain
value
value
to income statement
£m income statement
£m
£m
£m
Derivative financial assets 1.6 (3.5) 3.4 (6.3)
Fair value through profit and loss 1.6 (3.5) 3.4 (6.3)
Cash and cash equivalents 14 361.4 - 124.0 -
Other financial assets(1) 95.4 - 115.0 -
Total cash and other financial assets 456.8 - 239.0 -
Derivative financial liabilities (1.3) 0.5 (1.8) 5.4
Fair value through profit and loss (1.3) 0.5 (1.8) 5.4
Borrowings 15 (1,210.8) - (1,467.8) -
Lease liabilities (2.6) - (3.0) -
Other financial liabilities2 (70.5) - (62.7) -
Total borrowings and other financial liabilities (1,283.9) - (1,533.5) -
1. Includes rent receivable, amounts due from joint ventures and associates
and other receivables.
2. Includes trade and other payables (excluding rents in advance of £27.6
million (31 December 2024: £22.1 million)).
Fair value estimation
Financial instruments carried at fair value are required to be analysed by
level depending on the valuation method adopted under IFRS 13. The different
valuation levels are defined in note 10 'Property portfolio'.
The Group's financial assets and liabilities carried at fair value are
derivative financial instruments. The fair values of derivative financial
instruments are determined from observable market prices or estimated using
appropriate yield curves at 31 December each year by discounting the future
contractual cash flows to the net present values.
The fair values of the Group's derivative financial instruments are classified
as Level 2 fair values as defined by IFRS 13. There were no transfers between
levels during the current and prior year.
The fair values of the Group's cash and cash equivalents, other financial
assets carried at amortised cost and other financial liabilities are not
materially different from those at which they are carried in the consolidated
financial statements.
17 SHARE CAPITAL AND SHARE PREMIUM ISSUED AND FULLY PAID
Number Share capital(2) Share premium
of shares(1)
£m
£m
At 1 January 2025 1,953,178,138 488.2 232.5
At 31 December 2025 1,953,178,138 488.2 232.5
1. Total number of shares includes 128,350,793 shares issued to a controlled
entity in respect of secured shares of which 127,008,786 are held as
collateral for the exchangeable bond and 3,146,886 shares held by the Group's
Employee Benefit Trust in respect of employee share awards.
2. Nominal value of share capital of 25 pence per share.
18 CAPITAL COMMITMENTS
At 31 December 2025, the Group was contractually committed to £10.8 million
(31 December 2024: £24.1 million) of future expenditure for the purchase,
refurbishment and enhancement of investment property.
The Group's share of joint ventures capital commitments arising from LSJV
amounts to nil (31 December 2024: nil).
19 CONTINGENT LIABILITIES
The Group has contingent liabilities in respect of legislation, sustainability
targets, legal claims, guarantees and warranties arising from the ordinary
course of business. There are no contingent liabilities that require
disclosure or recognition in the consolidated financial statements in the
current and prior year.
20 CASH FLOWS FROM OPERATING ACTIVITIES
Note 2025 2024
£m
£m
Profit before tax 387.1 252.4
Adjustments:
Gain on revaluation and sale of investment property(1) (322.5) (197.6)
Change in value of investments and other receivables 6.5 7.0
Depreciation(2) 0.9 0.7
Amortisation of tenant lease incentives and other direct costs 0.5 (5.6)
Provision for expected credit loss 4 3.3 3.9
Profit from joint ventures and associates 11 - (4.5)
Share-based payment expense 8.3 3.1
Finance income 6 (20.5) (14.8)
Other finance income 6 (4.0) (4.5)
Finance costs 7 63.8 72.0
Other finance costs 7 9.7 6.5
Change in fair value of derivative financial instruments 3.0 0.9
Loss on sale of associate - 4.0
Loss on sale of investments and subsidiaries(3) 1.0 -
Change in working capital:
Change in trade and other receivables 15.6 (4.6)
Change in trade and other payables 8.5 (10.2)
Cash generated from operations 161.2 108.7
1. Included within the gain on revaluation and sale of investment property
in the consolidated income statement is cash transaction costs of £0.7
million (31 December 2024: £3.0 million) incurred on the disposal of
property.
2. £0.2 million (31 December 2024: £0.3 million) of depreciation is
recognised within note 5 'Administration expenses' and £0.7 million (31
December 2024: £0.4 million) is recognised within note 4 'Gross profit'.
3. Included within loss on sale of investments and subsidiaries in the
consolidated income statement are cash transaction costs of £5.7 million.
21 RELATED PARTY TRANSACTIONS
Transactions between the Group and its subsidiaries and joint ventures
On 1 April 2025, NBIM Mary Limited, a subsidiary of Norges Bank Investment
Management, acquired a 25 per cent non-controlling interest in Covent Garden
Real Estate Holdings Limited ("Covent Garden estate"), a subsidiary of the
Group. Prior to the transaction, NBIM already had a 23.5 per cent shareholding
in the Group. Details of the transaction are set out in note 12
'Non-controlling interest'.
During the year the Group recognised management fee income of £2.9 million
(31 December 2024: nil) that was charged on an arm's length basis as a result
of the transaction.
There have been no other material changes in related party transactions during
the year ended 31 December 2025.
ALTERNATIVE PERFORMANCE AND EPRA MEASURES (unaudited)
The Group has applied the European Securities and Markets Authority guidelines
on alternative performance measures ("APMs") in these results. An APM is a
financial measure of historical or future financial performance, position or
cash flow of the Group which is not a measure defined or specified in IFRS.
Many of the APMs included are based on the EPRA Best Practice Recommendations
reporting framework, a set of standard disclosures for the property industry,
which aims to improve the transparency, comparability and relevance of
published results of public real estate companies in Europe.
The Group also uses underlying earnings, property portfolio and financial debt
ratio APMs. Financial debt ratios are supplementary ratios which we believe
are useful in monitoring the capital structure of the Group. Additionally,
loan-to-value and interest cover are covenants within many of the Group's
borrowing facilities.
EPRA Net Reinstatement Value ("EPRA NRV"), EPRA Net Tangible Assets ("EPRA
NTA") and EPRA Net Disposal Value ("EPRA NDV") are alternative performance
measures that are calculated in accordance with the Best Practices
Recommendations of the European Public Real Estate Association ("EPRA") to
provide a transparent and consistent basis to enable comparison between
European property companies. EPRA NTA is considered to be the most relevant
measure for the Group's operating activity and is the primary measure of net
asset value.
Set out below and overleaf is a summary of the key Group APMs and EPRA
performance measures included within this Press Release.
APM measure - Group share basis Definition of measure Nearest IFRS Explanation and 2025 2024
measure
reconciliation
Underlying earnings EPRA earnings adjusted for items not considered part of the core underlying Profit for the year attributable to owners of the Parent Note 3 £81.9m £73.0m
activities of the Group
Underlying earnings Underlying earnings per weighted average number of ordinary shares Basic earnings per share attributable to owners of the Parent Note 3 4.5p 4.0p
per share
Market value of property portfolio (Group share) Market value of the property portfolio on a Group share basis Investment property Note 10 £4,700.7m £4,973.5m
Interest cover Underlying gross profit and other income divided by net underlying finance N/A Covenants 396.4% 292.1%
costs
page 53
Loan-to-value Net debt, at nominal value and excluding tenant deposits, divided by market N/A Covenants page 53 17.3% 28.2%
value of property portfolio
Gross debt with interest rate protection Proportion of drawn debt with interest rate protection, including interest on N/A N/A 100% 100%
cash deposits
Weighted average cost of debt - gross Cost of debt weighted by the drawn balance of external borrowings N/A Financial review, page 13 3.6% 4.0%
Weighted average cost of debt - net Cost of debt weighted by the drawn balance of external borrowings, taking N/A Financial review, page 13 3.4% 3.7%
account of interest income on cash deposits and interest rate derivatives
Cash and undrawn committed facilities Cash and cash equivalents, excluding tenant deposits, plus undrawn committed N/A Financial review, page 13 £1,014.1m £559.8m
facilities
Net debt to EBITDA Net debt, at nominal value, excluding tenant deposits, divided by EBITDA N/A Table 4 6.6x 10.9x
Total accounting return ("TAR") The movement in EPRA NTA per share plus dividends per share paid during the N/A Table 5 9.1% 7.0%
year
Total property return ("TPR") Capital growth including gains and losses on disposals plus rent received N/A Table 6 10.1% 7.6%
(less associated costs) including ground rent
Cost ratio Total Group share underlying costs, excluding non-cash share-based payments, N/A Table 7 33.1% 36.2%
as a percentage of Group share gross rental income
Like-for-like rental growth Compares the growth of net rental income for properties which have been owned N/A Table 8 5.9% N/A
throughout both years without significant capital expenditure in either year
EPRA measure Definition of measure Nearest IFRS Explanation and 2025 2024
measure
reconciliation
EPRA earnings Earnings that reflect the operational performance of the Group Profit for the year attributable to owners of the Parent Note 3 £88.6m £75.3m
EPRA earnings per share EPRA earnings per weighted average number of ordinary shares Basic earnings per share attributable to owners of the Parent Note 3 4.9p 4.1p
EPRA NTA Net asset value adjusted to include properties at fair value and exclude items Net assets attributable to owners of the Parent Note 3 £3,954.9m £3,671.1m
not expected to crystallise in a long-term investment property business model
EPRA NTA per share EPRA NTA per the diluted number of ordinary shares Net assets per share attributable to owners of the Parent Note 3 214.7p 200.2p
EPRA NDV EPRA NTA amended to include the fair value of financial instruments and debt Net assets attributable to owners of the Parent Note 3 £3,959.4m £3,725.2m
EPRA NDV per share EPRA NDV per diluted number of ordinary shares Net assets per share attributable to owners of the Parent Note 3 214.9p 203.2p
EPRA NRV EPRA NTA amended to include real estate transfer tax Net assets attributable to owners of the Parent Note 3 £4,271.0m £4,004.2m
EPRA NRV per share EPRA NRV per diluted number of ordinary shares Net assets per share attributable to owners of the Parent Note 3 231.8p 218.4p
EPRA net initial yield Annualised rental income less non-recoverable costs as a percentage of market N/A Table 9 3.7% 3.8%
value plus assumed purchaser's costs
EPRA topped-up initial yield Net initial yield adjusted for the expiration of rent-free periods N/A Table 9 4.0% 4.1%
EPRA vacancy ERV of un-let units (including those under offer) expressed as a percentage of N/A Table 10 4.2% 3.9%
the ERV of the property portfolio under management excluding units under
development
Capital expenditure Capital expenditure on acquisition and development of investment property N/A Table 11 £116.6m £131.4m
portfolio
EPRA cost ratio Total costs as a percentage of gross rental income (including direct vacancy N/A Table 12 40.2% 38.9%
costs)
Total costs as a percentage of gross rental income (excluding direct vacancy N/A Table 12 38.8% 34.9%
costs)
EPRA LTV (EPRA loan-to-value) Ratio of adjusted net debt, including net payables, to the sum of the net N/A Table 13 16.8% 27.4%
assets, including net receivables, of the Group, its subsidiaries, joint
ventures and associates, all on a proportionate basis, expressed as a
percentage
The summaries below present the reconciliation from IFRS to underlying and
EPRA metrics used in calculating Alternative Performance and EPRA measures:
1. Summary income statement
2025 2024
IFRS Adjustment for non-controlling interest EPRA and non- underlying adjustments Underlying earnings IFRS EPRA and non- underlying adjustments Underlying earnings
£m £m £m £m £m £m £m
Revenue(1) 216.3 (20.7) - 195.6 205.0 - 205.0
Costs(1) (38.6) 4.1 - (34.5) (37.9) - (37.9)
Gross profit 177.7 (16.6) - 161.1 167.1 - 167.1
Other income 3.0 - - 3.0 - - -
Gain on revaluation and sale of investment property 321.8 (35.7) (286.1) - 194.6 (194.6) -
Administration expenses(2) (50.2) 3.3 5.9 (41.0) (42.7) 3.3 (39.4)
Share of profit from associate - - - - 4.5 (1.7) 2.8
Net underlying finance costs (43.3) 1.9 - (41.4) (57.2) - (57.2)
Other(3) (21.9) - 21.9 - (13.9) 13.9 -
Taxation 0.3 (0.1) - 0.2 (0.3) - (0.3)
Profit for the year 387.4 (47.2) (258.3) 81.9 252.1 (179.1) 73.0
1. Revenue and costs exclude service charge income and expenses of £22.6
million (31 December 2024: £22.1 million).
2. Underlying administration expenses excludes £5.9 million (31 December
2024: £3.3 million) non-recurring corporate and transaction related costs.
3. Includes impairment of other receivables, other finance income and costs
including the change in fair value of derivatives and loss on sale of
investments and subsidiaries.
2. Summary balance sheet
2025
IFRS Adjustment for Group
£m non-controlling interest share
£m £m
Property portfolio- carrying value(1) 5,358.0 (697.1) 4,660.9
Net debt (901.5) 88.2 (813.3)
Other assets and liabilities 111.6 (5.0) 106.6
Non-controlling interest (613.9) 613.9 -
Net assets 3,954.2 - 3,954.2
EPRA adjustments 0.7 - 0.7
EPRA net assets 3,954.9 - 3,954.9
1. Includes £20.7 million accounted for as owner-occupied property.
3. Summary cash flow
2025
IFRS Adjustment for Group
£m non-controlling interest share
£m £m
Cash excluding tenant deposits at 1 January 109.8 - 109.8
Non-controlling interest's share of cash acquired - (7.5) (7.5)
Operating inflow(1) 115.1 (11.1) 104.0
Investing outflow (111.0) 3.9 (107.1)
Financing inflow 306.6 - 306.6
Dividends paid (74.6) 7.9 (66.7)
Cash excluding tenant deposits at 31 December 345.9 (6.8) 339.1
1. Operating inflow excludes the movement in tenant deposits of £1.3
million, which has been included in operating cash inflow of £116.4 million
as per the consolidated statement of cash flows.
Alternative performance measures - Group share basis
The APM measures included in tables four to eight have been presented on a
Group share basis and therefore exclude amounts allocated to non-controlling
interest and the Lillie Square joint venture.
4. Net debt to EBITDA
Group share Note 2025 2024
£m
£m
Underlying gross profit Table 1 161.1 167.1
Underlying other income Table 1 3.0 -
Underlying administration expenses Table 1 (41.0) (39.4)
123.1 127.7
Adjusted for:
Depreciation 0.8 0.7
EBITDA (A) 123.9 128.4
Net debt (B)(1) Table 2 813.3 1,405.0
Net debt to EBITDA (B/A) 6.6x 10.9x
1. Prior year net debt of £1,405.0 million can be reconciled to note 15
'Borrowings'.
5. Total accounting return
Note 2025 2024
£m
£m
Opening EPRA NTA (A)(1) 3 200.2p 190.3p
Closing EPRA NTA(1) 3 214.7p 200.2p
Increase in the year 14.5p 9.9p
Adjusted for:
Dividends per share paid in the current year 9 3.7p 3.4p
Total accounting return (B) 18.2p 13.3p
Total accounting return % (B/A) 9.1% 7.0%
1. EPRA NTA has been calculated in line with EPRA Best Practice
Recommendations and therefore includes our share of the Lillie Square joint
venture.
6. Total property return
Note 2025 2024
£m
£m
Gross profit Table 1 161.1 167.1
Gain on revaluation and sale of investment property Table 1 286.1 194.6
Total capital return (A) 447.2 361.7
Market value of property portfolio (Group share) 10 4,700.7 4,973.5
Gain on revaluation and sale of investment property Table 1 (286.1) (194.6)
Capital employed (B) 4,414.6 4,778.9
Total property return % (A/B) 10.1% 7.6%
7. Cost ratio
2025 2024
£m
£m
Note
Revenue (A) Table 1 195.6 205.0
Costs Table 1 34.5 37.9
Administration expenses Table 1 41.0 39.4
Less: share-based payments 5 (7.7) (3.1)
Other income(1) Table 1 (3.0) -
Total costs (B) 64.8 74.2
Cost ratio (B/A) 33.1% 36.2%
1. Asset management fees, broadly reflecting the costs of managing the
estate, are earned by the Group in relation to the Covent Garden estate
following the 25 per cent investment by NBIM.
8. Like-for-like rental growth
Rental income for the previous year is presented below on a pro-forma basis to
reflect the Group's rental growth on a like-for-like basis following the
completion of the long-term partnership with NBIM on 1 April 2025.
Rental income for each period includes 100 per cent of the portfolio for the
period 1 January to 31 March and excludes amounts allocated to non-controlling
interest for the period 1 April to 31 December; see note 10 'Property
portfolio' for valuation attributable to non-controlling interest to which
this income relates. Both years exclude rental income from joint ventures or
associates, and do not include income relating to £1.9 million of Group
properties held in Lillie Square LP Limited (wholly-owned subsidiary).
The like-for-like rental growth compares the rental income of properties which
have been owned throughout both periods without significant capital
expenditure in either year. Refer to note 10 'Property portfolio', for further
details of the portfolio including acquisitions and disposals. Properties
classified as in development, where no income generating part remained in
operation during the period of development, were valued at £58.0 million at
31 December 2025.
Note 2025
£m
Rental income in current year(1 ) 4 216.3
Adjusted for non-controlling interest (20.7)
Rental income for current year 195.6
Adjusted for impact of:
Acquisitions (4.9)
Properties in development(2) (0.9)
Like-for-like rental income in current year (A) 189.8
Rental income in previous year(1 ) 4 205.0
Adjusted for non-controlling interest (19.7)
Pro-forma adjusted rental income in previous year 185.3
Adjusted for impact of:
Acquisitions (2.5)
Disposals (3.4)
Properties in development(2) (0.1)
Like-for-like rental income in prior year (B) 179.3
Like-for-like growth in rental income ((A-B)/B) 5.9%
1. Revenue as reported in the consolidated income statement, excluding
service charge income.
2. Development properties are defined as properties where no income
generating part remained operational during the period of development. The
income pre and post development is removed for like-for-like purposes.
EPRA measures
The EPRA measures included in tables nine to 13 have been calculated in line
with EPRA Best Practice Recommendations.
9. EPRA Net initial yield and EPRA 'topped-up' net initial yield
Note 2025 2024
£m
£m
Investment property - Group share 10 4,700.7 4,973.5
Investment property - share of joint ventures and associates 42.5 43.7
Trading property (including share of joint venture) 19.8 21.6
Less: developments (161.4) (228.0)
Completed property portfolio 4,601.6 4,810.8
Allowance for estimated purchasers' costs 316.1 333.1
Gross up completed property portfolio valuation (A) 4,917.7 5,143.9
Annualised cash passing rental income 189.7 204.7
Property outgoings (6.3) (6.9)
Annualised net rents (B) 183.4 197.8
Add: notional rent expiration of rent periods or other lease incentives 13.1 14.9
Topped-up net annualised rent (C) 196.5 212.7
EPRA net initial yield (B/A) 3.7% 3.8%
EPRA 'topped-up' net initial yield (C/A) 4.0% 4.1%
10. EPRA vacancy rate
2025 2024
£m
£m
Estimated rental value of vacant space 10.8 9.3
Estimated rental value of the portfolio less refurbishment estimated rental 259.0 237.1
value
EPRA vacancy rate for the property portfolio under management 4.2% 3.9%
EPRA vacancy rate includes units under offer, net of which vacancy relating to
units available to let is 2.6 per cent (31 December 2024: 2.6 per cent).
Investment properties held within the joint venture at Lillie Square totalling
£42.5 million (the Group's share) (31 December 2024: £43.7 million (the
Group's share)) are not included in the vacancy rate above.
11. Property related capital expenditure
2025 2024
Group Adjustment Joint Total Group (excluding Joint venture and associate Total Group
(excluding
joint venture) for non- venture Group joint ventures and associates) £m £m
controlling interest
£m £m £m £m
Acquisitions 85.4 (0.3) - 85.1 84.9 - 84.9
Development - - 0.1 0.1 - 0.2 0.2
Investment property
Incremental lettable space 7.4 (1.4) - 6.0 2.0 - 2.0
No incremental lettable space 25.4 (2.3) - 23.1 38.3 0.8 39.1
Tenant lease incentives 0.3 - - 0.3 2.8 - 2.8
Capitalised interest - - - - - - -
Total CapEx 118.5 (4.0) 0.1 114.6 128.0 1.0 129.0
Conversion from accrual to cash basis 1.9 0.1 - 2.0 2.4 - 2.4
Total CapEx on cash basis 120.4 (3.9) 0.1 116.6 130.4 1.0 131.4
12. EPRA cost ratio
2025 2024
£m
£m
Note
Administration expenses(1 ) 5 50.2 42.7
Total property outgoings 4 57.9 56.1
Provision for expected credit loss 4 3.3 3.9
Less: Service charge expense 4 (22.6) (22.1)
Management fee (3.0) (0.1)
Share of joint ventures and associates expenses 2.1 2.9
Exclude:
Ground rent cost (0.3) (0.4)
EPRA cost (including direct vacancy costs) (A) 87.6 83.0
Direct vacancy costs (2.9) (8.6)
EPRA costs (excluding direct vacancy costs) (B) 84.7 74.4
Gross rental income less ground rent costs 238.6 226.7
Less: Service charge income 4 (22.6) (22.1)
Share of joint ventures and associates property income 2.1 8.8
Adjusted gross rental income (C) 218.1 213.4
EPRA cost ratio (including direct vacancy costs) (A/C) 40.2% 38.9%
EPRA cost ratio (excluding direct vacancy costs) (B/C) 38.8% 34.9%
1. £0.8 million (31 December 2024: £0.7 million) of administration
expenses were capitalised during the year. These capitalised costs mainly
relate to employee costs as it is the Group's policy to capitalise directly
attributable overheads and operating expenses to assets under refurbishment or
development.
13. EPRA LTV
2025 2024
Group Adjustment for non-controlling interest Share of joint Total Group Share of joint venture Total
£m
£m
£m
£m
£m
£m venture
£m
Borrowings from financial institutions (972.4) 95.0 - (877.4) (1,239.8) - (1,239.8)
Exchangeable bonds (275.0) - - (275.0) (275.0) - (275.0)
Net payables 57.0 (0.3) (59.5) (2.8) - - -
Exclude:
Cash and cash equivalents(1) 361.4 (10.7) 5.7 356.4 124.0 4.9 128.9
EPRA net debt (B) (829.0) 84.0 (53.8) (798.8) (1,390.8) 4.9 (1,385.9)
Investment property at fair value 5,386.4 (706.4) 42.5 4,722.5 4,943.6 43.7 4,987.3
Owner-occupied property at fair value 20.7 - - 20.7 20.1 - 20.1
Properties held for sale at fair value - - - - 9.8 - 9.8
Properties under development - - 19.8 19.8 - 21.6 21.6
Net receivables - - - - 85.5 (61.5) 24.0
Total property value (A) 5,407.1 (706.4) 62.3 4,763.0 5,059.0 3.8 5,062.8
EPRA LTV (B/A) 16.8% 27.4%
1. Includes tenant deposits for the Group of £15.5 million (31 December
2024: £14.2 million) (non-controlling interest £3.9 million) held as
security against tenant rent payments which are subject to certain
restrictions and therefore not available for general use by the Group.
COVENANTS
Key financial covenants
2025
Maturity Nominal value Carrying value LTV Interest cover
covenant
covenant
£m £m
Loan notes 2026-2037 380.0 379.6 60% 1.20x
Exchangeable bond 2026 275.0 275.9 N/A N/A
Unsecured term loan(1) 2029 75.0 68.7 60% 1.20x
Secured term loans (Canada Life) 2029 67.4 65.0 60% 1.40x
Secured term loans (Aviva) 2030-2035 450.0 421.6 65% 1.35x
Unsecured revolving credit facilities (undrawn)(1) 2029-2030 750.0 - 60% 1.20x
1. Additional covenants include that Group unencumbered assets are equal to
or exceed 1.5x of Group unsecured debt, and subsidiary unencumbered assets are
equal to or exceed 1.25x of the Company unsecured debt.
Loan-to-value (Group share)
Note 2025 2024
£m
£m
Debt at nominal value 20 1,247.4 1,514.8
Adjusted for non-controlling interest(1) (95.0) -
Debt at nominal value - Group share (A) 1,152.4 1,514.8
Cash 14 (345.9) (109.8)
Adjusted for non-controlling interest 6.8 -
Cash - Group share (B) (339.1) (109.8)
Net debt (C = A+B) Table 2 813.3 1,405.0
Total property portfolio at market value (Group share) (B) 10 4,700.7 4,973.5
Loan-to-value (C/B)(2) 17.3% 28.2%
1. Represents 25 per cent of £380 million, which is the nominal value of
debt as per note 12 'Non-controlling interest'.
2. Loan-to-value excludes amounts allocated to non-controlling interest and
the Lillie Square joint venture.
Interest cover (Group share)
Note 2025 2024
£m
£m
Finance costs (61.6) (72.0)
Finance income 20.2 14.8
Net underlying finance costs (A) Table 1 (41.4) (57.2)
Underlying operating income:
Gross profit Table 1 161.1 167.1
Other income Table 1 3.0 -
Underlying operating income (B) 164.1 167.1
Interest cover (B/A)(1) 396.4% 292.1%
1. Interest cover excludes amounts allocated to non-controlling interest and
the Lillie Square joint venture.
ANALYSIS OF PROPERTY PORTFOLIO (unaudited)
Property portfolio valuation by use
31 December 2025 Retail Food & Offices Total Commercial Residential Portfolio under management Portfolio on a Group
beverage share
basis
Valuation (£m)(1) 1,977.6 1,782.0 1,006.8 4,766.4 638.8 5,405.2 4,698.8
Valuation (%) 36% 33% 19% 88% 12% 100% 100%
L-f-L valuation movement (FY 2025) +10.4% +5.8% +5.6% +7.6% -0.6% +6.6% +6.7%
L-f-L valuation movement (H2 2025) +5.8% +2.8% +2.5% +4.0% -0.3% +3.4% +3.5%
Annualised gross income (£m) 75.8 76.4 39.0 191.2 23.8 215.0 187.6
Annualised gross income (%) 35% 36% 18% 89% 11% 100% 100%
L-f-L annualised gross income movement (FY 2025) +3.2% +5.0% +12.0% +5.6% +3.2% +5.3% +5.4%
L-f-L annualised gross income movement (H2 2025) +3.4% +3.4% +2.5% +3.2% +2.0% +3.1% +2.9%
ERV (£m) 97.9 89.3 57.1 244.3 26.0 270.3 234.8
ERV (%) 36% 33% 21% 90% 10% 100% 100%
ERV psf (£) 137 95 83 104 62 98 98
L-f-L ERV movement (FY 2025) +8.1% +4.9% +5.8% +6.4% +4.4% +6.2% +6.3%
L-f-L ERV movement (H2 2025) +4.7% +2.3% +1.6% +3.1% +2.2% +3.0% +3.0%
Net initial yield 3.6% 3.9% 3.4% 3.7% 3.0% 3.6% 3.6%
Topped-up net initial yield 3.8% 4.2% 3.8% 3.9% N/A 3.9% 3.9%
Equivalent yield 4.5% 4.6% 4.8% 4.6% 3.3% 4.4% 4.4%
WAULT (years) 3.1 8.1 2.7 4.8 N/A 4.8 4.8(3)
Floor area (sq ft m)(2) 0.8 0.9 0.7 2.4 0.4 2.8 2.8(3)
Unit count(2) 419 392 436 1,247 659 1,906 1,906(3)
1. Excludes £1.9 million of Group properties primarily held in Lillie
Square LP Limited (a wholly-owned subsidiary).
2. Excluding long-leasehold residential interests.
3. WAULT, floor area and unit count have not been adjusted and reflect 100
per cent of the portfolio.
Property portfolio valuation by location
31 December 2025 Covent Garden Carnaby | Soho Chinatown Portfolio under management Portfolio on a Group share basis
Valuation (£m)(1) 2,825.5 1,816.9 762.8 5,405.2 4,698.8
Valuation (%) 52% 34% 14% 100% 100%
L-f-L valuation movement (FY 2025) +5.5% +8.5% +6.4% +6.6% +6.7%
L-f-L valuation movement (H2 2025) +2.7% +4.8% +3.1% +3.4% +3.5%
Annualised gross income (£m) 109.5 72.2 33.3 215.0 187.6
Annualised gross income (%) 51% 34% 15% 100% 100%
L-f-L annualised gross income movement (FY 2025) +4.8% +6.8% +4.0% +5.3% +5.4%
L-f-L annualised gross income movement (H2 2025) +4.2% +2.0% +1.9% +3.1% +2.9%
ERV (£m) 142.1 91.9 36.3 270.3 234.8
ERV (%) 53% 34% 13% 100% 100%
ERV psf (£) 102 99 86 98 98
L-f-L ERV movement (FY 2025) +5.6% +7.5% +5.5% +6.2% +6.3%
L-f-L ERV movement (H2 2025) +3.3% +2.9% +2.2% +3.0% +3.0%
Net initial yield 3.5% 3.5% 3.9% 3.6% 3.6%
Topped-up net initial yield 3.9% 3.8% 4.3% 3.9% 3.9%
Equivalent yield 4.5% 4.4% 4.2% 4.4% 4.4%
WAULT (years) 4.8 4.1 6.5 4.8 4.8(3)
Floor area (sq ft m)(2) 1.5 0.9 0.4 2.8 2.8(3)
Unit count(2) 854 702 350 1,906 1,906(3)
1. Excludes £1.9 million of Group properties primarily held in Lillie
Square LP Limited (a wholly-owned subsidiary).
2. Excluding long-leasehold residential interests.
3. WAULT, floor area and unit count have not been adjusted and reflect 100
per cent of the portfolio.
DIVIDENDS
The Directors of Shaftesbury Capital PLC have proposed a final cash dividend
of 2.1 pence per ordinary share (ISIN GB00B62G9D36) payable on Friday, 22 May
2026.
Dates
The following are the salient dates for the payment of the proposed 2025 final
cash dividend:
Proposed 2025 final dividend announced Wednesday, 25 February 2026
Sterling/Rand exchange rate struck Wednesday, 8 April 2026
Sterling/Rand exchange rate and dividend amount in Rand announced by 11.00 am Thursday, 9 April 2026
(Johannesburg time)
Last day to trade cum-dividend* Tuesday, 21 April 2026
Ordinary shares listed ex-dividend on the Johannesburg Stock Exchange Wednesday, 22 April 2026
Ordinary shares listed ex-dividend on the London Stock Exchange Thursday, 23 April 2026
Record date for the 2025 final dividend in UK and South Africa Friday, 24 April 2026
Deadline for submission of declaration of eligibility to receive gross PID Friday, 24 April 2026 (COB)
payment to UK registrar
Annual General Meeting Thursday, 14 May 2026
Dividend payment date for shareholders Friday, 22 May 2026
The proposed 2025 final cash dividend is subject to approval at the Company's
Annual General Meeting, to be held on Thursday, 14 May 2026.
*South African shareholders should note that, in accordance with the
requirements of Strate, the last day to trade cum-dividend on the Johannesburg
Stock Exchange will be Tuesday, 21 April 2026. No dematerialisation or
rematerialisation of shares will be possible from Wednesday, 22 April 2026 to
Friday, 24 April 2026 inclusive. No transfers between the UK and South African
registers may take place from close of business on Thursday, 9 April 2026 to
Friday, 24 April 2026 inclusive.
The above dates are proposed and subject to change.
The proposed 2025 final cash dividend will be paid wholly as a Property Income
Distribution ("PID"). There will be no Non-PID (ordinary dividend) element of
the final cash dividend. As such, the entire final cash dividend will be
subject to a deduction of a 20 per cent UK withholding tax unless exemptions
apply.
Information for shareholders
The information below is included only as a general guide to taxation for
shareholders based on Shaftesbury Capital's understanding of the law and the
practice currently in force. Any shareholder who is in any doubt as to their
tax position should seek independent professional advice.
UK shareholders
The proposed 2025 final cash dividend will be paid wholly as a PID. Certain
categories of shareholders may be eligible for exemption from the 20 per cent
UK withholding tax and may register to receive their dividends on a gross
basis. Further information, including the required forms, is available from
the 'Investor Information' section of the Company's website
(https://www.shaftesburycapital.com/en/investors/investor-information.html),
or on request from the Company's UK registrar, MUFG Corporate Markets. Validly
completed forms must be received by MUFG Corporate Markets no later than the
dividend record date, as advised; otherwise the dividend will be paid after
deduction of tax.
There will be no Non-PID element of the final cash dividend.
South African shareholders
The proposed 2025 final cash dividend proposed by the Company is a foreign
payment and the funds are sourced from the UK.
PID: The proposed 2025 final cash dividend will be paid wholly as a PID and a
20 per cent UK withholding tax is applicable to a PID. As such, South African
shareholders may apply to HMRC after payment of the proposed 2025 final cash
dividend for a refund of the difference between the 20 per cent UK withholding
tax and the UK/South African double taxation treaty rate of 15 per cent.
The proposed 2025 final cash dividend will be exempt from income tax but will
constitute a dividend for Dividends Tax purposes, as it will be declared in
respect of a share listed on the exchange operated by the JSE. South African
Dividends Tax will therefore be withheld from the proposed 2025 final cash
dividend at a rate of 20 per cent, unless a shareholder qualifies for an
exemption and the prescribed requirements for effecting the exemption are in
place by the requisite date. Certain shareholders may also qualify for a
reduction of South African Dividends Tax liability to 5 per cent (being the
difference between the South African dividends tax rate and the effective UK
withholding tax rate of 15 per cent) if the prescribed requirements for
effecting the reduction are in place by the requisite date.
Non-PID: There will be no Non-PID element of the proposed 2025 final cash
dividend.
Other overseas shareholders
Other non-UK shareholders may be able to make claims for a refund of UK
withholding tax deducted pursuant to the application of a relevant double
taxation convention. UK withholding tax refunds can only be claimed from HMRC,
the UK tax authority.
Additional information on PIDs and ordinary dividends (Non-PIDs) can be found
at
https://www.shaftesburycapital.com/en/investors/investor-information/reit.html
GLOSSARY
Annualised gross income
Total annualised actual and "estimated income" from leases at a valuation
date. It includes sundry non-leased income and estimated turnover related
rents. No rent is attributed to leases which were subject to rent free periods
at that date. It does not reflect any head rents and estimated irrecoverable
outgoings at the valuation date. "Estimated income" refers to gross ERVs in
respect of rent reviews outstanding at the valuation date and, where
appropriate, ERV in respect of lease renewals outstanding at the valuation
date where the fair value reflects terms for a renewed lease.
APM (alternative performance measure)
A financial measure of historical or future financial performance, position or
cash flows of the Group which is not a measure defined or specified in IFRS.
Cash and undrawn committed facilities
Cash and cash equivalents, excluding tenant deposits, plus undrawn committed
facilities.
Contracted income
Includes rent frees and contracted rent increases.
Covent Garden partnership
A long-term partnership with NBIM, the Norwegian sovereign wealth fund, in
respect of the Covent Garden estate. On 1 April 2025, Shaftesbury Capital sold
a 25 per cent non-controlling interest in the Covent Garden estate to NBIM
with Shaftesbury Capital retaining 75 per cent ownership and management
control over the estate.
EBITDA
EBITDA represents underlying earnings before interest, tax, depreciation and
amortisation.
EPC (Energy Performance Certificate)
An asset rating setting out how energy efficient a building is, rated by its
carbon dioxide emission on a scale of A to G, with A being the most energy
efficient.
EPRA
European Public Real Estate Association, the publisher of Best Practice
Recommendations intended to make financial statements of public real estate
companies in Europe clearer, more transparent and comparable.
EPRA cost ratio (including direct vacancy costs)
EPRA cost ratio (including direct vacancy costs) is a proportionally
consolidated measure of the ratio of net overheads and operating expenses
against gross rental income (with both amounts excluding ground rents
payable). Net overheads and operating expenses relate to all administrative
and operating expenses, net of any service fees, recharges or other income
specifically intended to cover overhead and property expenses.
EPRA cost ratio (excluding direct vacancy costs)
EPRA cost ratio (excluding direct vacancy costs) is the ratio defined above,
but with direct vacancy costs removed from the net overheads and operating
expenses balance.
EPRA earnings per share
Profit or loss for the year excluding amounts allocated to non-controlling
interest excluding valuation movements on properties, fair value changes of
financial instruments, cost of early close out of debt, merger-related
integration and other transaction costs unlikely to reoccur in the foreseeable
future, divided by the weighted average number of shares in issue during the
year.
EPRA LTV (loan-to-value)
Ratio of net debt, including net payables, to the sum of the net assets,
including net receivables, of the Group, its subsidiaries and joint ventures
and associates, all on a proportionately consolidated basis, expressed as a
percentage. The calculation includes trading properties at fair value and debt
at nominal value.
EPRA NDV (net disposal value) per share
The net assets attributable to owners of the Parent as at the end of the year
including the excess of the fair value of trading property over its cost,
revaluation of other non-current investments and the adjustment to reflect
fixed interest rate debt at fair value, divided by the diluted number of
ordinary shares.
EPRA net initial yield
Annualised net rent (after deduction of revenue costs such as head rent,
running void, service charge after shortfalls and empty rates) on investment
and trading property expressed as a percentage of the gross market value
before deduction of theoretical acquisition costs, all on a proportionally
consolidated basis.
EPRA NTA (net tangible assets) per share
The net assets attributable to owners of the Parent as at the end of the year
including the excess of the fair value of trading property over its cost and
revaluation of other non-current investments, excluding the fair value of
financial instruments and deferred tax on revaluations, divided by the diluted
number of ordinary shares.
EPRA NRV (net reinstatement value) per share
The net assets attributable to owners of the Parent as at the end of the year
including the excess of the fair value of trading property over its cost and
excluding the fair value of financial instruments, deferred tax on
revaluations and diluting for the effect of those shares potentially issuable
under employee share schemes plus a gross up adjustment for related costs such
as Real Estate Transfer Tax, divided by the diluted number of ordinary shares.
EPRA topped-up initial yield
EPRA net initial yield adjusted for the expiration of rent-free periods.
EPRA vacancy
ERV of un-let units, including those under offer, expressed as a percentage of
the ERV of property portfolio under management,
excluding units under development. EPRA vacancy excludes properties held
within the Lillie Square joint venture.
ERV (Estimated rental value)
The external valuers' estimate of the open market rent which, on the date of
valuation, could reasonably be expected to be obtained on a new letting or
rent review of the property.
F&B (Food & Beverage)
A sector within the portfolio which includes establishments primarily engaged
in the preparation and sale of food and beverages. This encompasses a diverse
range of customers including restaurants, cafés, bars, pubs and other
hospitality venues.
Group share
Group share excludes the Lillie Square joint venture and any non-controlling
interest in the Group's subsidiaries, removed on a line-by-line basis.
Headline earnings per share
Headline earnings per share is calculated in accordance with Circular 1/2023
issued by the South African Institute of Chartered Accountants ("SAICA"), a
requirement of the Group's JSE listing. This measure is not a requirement of
IFRS.
IFRS
United Kingdom-adopted international accounting standards
JSE
Johannesburg Stock Exchange.
Leasing activity
The rental value secured from lettings, rent reviews and lease renewals during
a period.
Like-for-like property
Property which has been owned throughout both years, without significant
capital expenditure in either year, so income can be compared on a
like-for-like basis. For the purposes of comparison of capital values, this
will also include assets owned at the previous balance sheet date but not
necessarily throughout the prior year.
Longmartin
The Longmartin associate was a 50 per cent investment arrangement between
Shaftesbury Capital and The Mercers' Company. The Group disposed of its share
in Longmartin during the prior year.
LTV (loan-to-value)
LTV is calculated on the basis of net debt divided by the market value of the
property portfolio excluding amounts allocated to non-controlling interest and
the Lillie Square joint venture.
LSJV
The Lillie Square joint venture is a 50 per cent joint venture between the
Group and Kwok Family Interests ("KFI"). The joint venture was established to
own, manage and develop land interests at Lillie Square.
MSCI
Producer of an independent benchmark of property returns.
NAV
Net asset value.
NBIM
Norges Bank Investment Management.
Net debt
Total borrowings, at nominal value, less cash and cash equivalents, excluding
tenant deposits. Net debt excludes amounts allocated to non-controlling
interest and the Lillie Square joint venture.
Net initial yield
The net initial income at the valuation date expressed as a percentage of the
gross valuation. Yields reflect net income after deduction of any ground
rents, head rents and rent charges and estimated irrecoverable outgoings at
the valuation date.
NRI (Net rental income)
Gross rental income less ground rents, payable service charge expenses and
other non-recoverable charges, having taken due account of expected credit
loss provisions and adjustments to comply with International Financial
Reporting Standards regarding tenant lease incentives.
Nominal equivalent yield
Effective annual yield to a purchaser on the gross market value, assuming rent
is receivable annually in arrears, and that the property becomes fully
occupied and that all rents revert to the current market level (ERV) at the
next review date or lease expiry.
Passing rent
Contracted annual rents receivable at the balance sheet date. This takes no
account of accounting adjustments made in respect of rent-free periods or
tenant lease incentives, the reclassification of certain lease payments as
finance charges or any irrecoverable costs and expenses, and does not include
excess turnover rent, additional rent in respect of unsettled rent reviews or
sundry income.
PIDs (Property income distributions)
Distribution under the REIT regime that constitutes at least 90 per cent of
the Group's taxable income profits arising from its qualifying property rental
business, by way of dividend. PIDs can be subject to withholding tax at 20 per
cent. If the Group distributes profits from its non-qualifying business, the
distribution will be taxed as an ordinary dividend in the hands of the
investors.
Portfolio under management
Reflects the portfolio under management at 100 per cent.
REIT (Real Estate Investment Trust)
A REIT is exempt from corporation tax on income and gains of its property
rental business (qualifying activities) provided a number of conditions are
met. It remains subject to corporation tax on non-exempt income and gains
(non-qualifying activities) which would include any trading activity, interest
income and development and management fee income.
RETT (Real Estate Transfer Tax)
Purchasers' cost as included within the independent valuation of investment
and trading properties.
Reversionary potential
The amount by which ERV exceeds annualised gross income, measured at a
valuation date.
RICS
Royal Institution of Chartered Surveyors.
SBTi
Science Based Targets initiative.
Shaftesbury Capital
Shaftesbury Capital PLC (also referred to as "the Company", "Shaftesbury
Capital" or "the Parent"), and all its subsidiaries and Group undertakings,
collectively referred to as "the Group".
Sterling Overnight Interbank Average Rate ("SONIA")
The average overnight Sterling risk-free interest rate, set in arrears, paid
by banks for unsecured transactions.
TAR (Total accounting return)
The movement in EPRA NTA per share plus dividends per share paid during the
year.
Tenant lease incentives
Any incentives offered to customers to enter into a lease. Typically,
incentives are in the form of an initial rent-free period and/or a cash
contribution to fit-out the premises. Under IFRS the value of incentives
granted to customers ais amortised through the consolidated income statement
on a straight-line basis to the earlier of break or lease expiry.
Topped-up net initial yield
Net initial yield adjusted for the expiration of rent-free periods.
TOMs
Themes, Outcomes and Measures system.
TPR (Total property return)
Capital growth including gains and losses on disposals plus rent received less
associated costs, including ground rent. TPR excludes amounts allocated to
non-controlling interest and the Lillie Square joint venture.
TSR (Total shareholder return)
The movement in the price of an ordinary share plus dividends paid during the
year assuming re-investment in ordinary shares.
Underlying administration expenses
Administration expenses excluding non-recurring corporate and
transaction-related costs. The items are excluded as they are considered to be
non-recurring or significant by virtue of size and nature.
Underlying earnings
EPRA earnings adjusted for the non-core property rental income business. The
Lillie Square joint venture is not considered part of the core underlying
business of the Group and therefore its results are excluded from underlying
earnings. Underlying earnings excludes amounts allocated to non-controlling
interest.
Underlying earnings per share ("EPS")
Underlying earnings divided by the weighted average number of shares in issue
during the year.
Valuation growth/decline
The valuation movement and realised surpluses or deficits arising from the
Group's investment property portfolio expressed as a percentage return on the
valuation at the beginning of the period adjusted for acquisitions, disposals
and capital expenditure. When measured on a like-for-like basis, the
calculation excludes those properties acquired or sold during the period.
Weighted average cost of debt - gross
The cost of debt weighted by the drawn balance of external borrowings.
Weighted average cost of debt - net
The cost of debt weighted by the drawn balance of external borrowings, taking
account of interest income on cash deposits and interest rate derivatives.
WAULT (Weighted average unexpired lease term)
The unexpired lease term to the earlier of break or lease expiry weighted by
passing rent for each lease.
Zone A
A means of analysing and comparing the rental value of retail space by
dividing it in to zones parallel with the main frontage. The most valuable
zone, Zone A, falls within a 6 metre depth of the shop frontage. Each
successive zone is valued at half the rate of the zone in front of it. The
blend is referred to as being 'ITZA' ("In Terms of Zone A").
Important notices
This press release contains "forward-looking statements" regarding the belief
or current expectations of Shaftesbury Capital PLC, its Directors and other
members of its senior management about Shaftesbury Capital PLC's businesses,
financial performance and results of operations. These forward-looking
statements are not guarantees of future performance. Rather, they are based on
current views and assumptions and involve known and unknown risks,
uncertainties and other factors, many of which are outside the control of
Shaftesbury Capital PLC and are difficult to predict, that may cause actual
results, performance or developments to differ materially from any future
results, performance or developments expressed or implied by the
forward-looking statements. These forward-looking statements speak only as at
the date of this press release. Except as required by applicable law,
Shaftesbury Capital PLC makes no representation or warranty in relation to
them and expressly disclaims any obligation to update or revise any
forward-looking statements contained herein to reflect any change in
Shaftesbury Capital PLC's expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is based. The
information contained in this press release does not purport to be
comprehensive and has not been independently verified.
Any information contained in this announcement on the price at which shares or
other securities in Shaftesbury Capital PLC have been bought or sold in the
past, or on the yield on such shares or other securities, should not be relied
upon as a guide to future performance. No statement in this press release is
intended to be a profit forecast and no statement in this press release should
be interpreted to mean that earnings per share of Shaftesbury Capital PLC for
the current or future financial years would necessarily match or exceed the
historical published earnings per share of Shaftesbury Capital PLC.
Certain industry and market data contained in this press release has come from
third party sources. Third party publications, studies and surveys generally
state that the data contained therein have been obtained from sources believed
to be reliable, but that there is no guarantee of accuracy or completeness of
such data.
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