Major property developer Derwent London gave a huge boost to confidence in the capital yesterday by committing to £700m worth of new high-end development projects.
The FTSE 250 giant will start work next year on a £500 million redevelopment of the historic Astoria music venue on the corner of Oxford Street and Charing Cross Road, a follow-on from the adjoining new Crossrail station, and will also begin construction on £200 million of offices in Shoreditch.
“Macron has tried to lure people into Paris, but the tech people much prefer to be here. London is still a phenomenal world capital” Derwent chief executive John Burns told City A.M.
Burns added: “London is still the place where people want to be – from our point of view its business as usual. People feel comfortable here, they can express themselves freely and there is so much culture and entertainment. Young people want to work in London”.
The news came as Derwent, which mostly invests in London’s West End and the “tech belt” around Old Street, also posted first-half results yesterday which saw the value of the firm’s property empire rise 1.3 per cent to £5bn in the six months to the end of June.
Strong demand in the lettings and occupier market, including a two-floor letting for the company’s flagship Brunel building in Paddington announced yesterday, has given Derwent confidence to progress with the two flagship redevelopments.
Derwent also upped its interim dividend to 19.1p per share, an increase of more than 10 per cent, while net rental income climbed 1.6 per cent to £80.6m.
As well as a flurry of new offices and shops, the 285,000 square feet redevelopment project at Astoria in Soho Place will also house the West End’s first new theatre for 30 years.