views

The Walbrook is about to strike gold

FOR those who like playing the waiting game, Minerva is a good bet. As expected, it swung to a profit while its net asset value (NAV) per share also continued to edge up, to 102p in December from 95p a month earlier.

There were no major letting announcements, however, which will come as a surprise to some investors. There are a “number of discussions underway” over its St Botolphs development, but talks on the on the 444,000 sq ft Walbrook building are merely “active”.

The Walbrook, which has been designed to house a big-hitting tenant, has missed out on some lucrative deals recently (BlackRock went to Songbird’s Drapers Gardens while Macquarie signed up at British Land’s Ropemaker). That has understandably left some investors a little tetchy.

With the shares now trading on 0.8 times December’s NAV, after strong share price performance in the last three months, the firm will need to announce a Walbrook signing soon. Still, the odds are stacked in its favour. With virtually no competing developments scheduled to come to market until 2011, Minerva is well-placed to capitalise on rising demand.

The next large firm to start office hunting in the City will have little choice other than to sign a lease at the Walbrook. With no rivals to push the price down, Minerva is sure to secure more than the £49 per sq ft that BlackRock paid for Drapers Gardens. Shrewd investors will accumulate shares before rumours of a Walbrook signing start to surface.
david.crow@cityam.com