Financial results for Howard de Walden Estates Holdings Ltd announced

In the financial year which ended on 31 March, Howard de Walden recorded strong growth in rental income and unchanged profit after operating costs. As expected, revenue profit before tax fell owing to the increase in net debt from borrowings transacted in 2019.

Rental growth was driven by lettings after refurbishment with the strongest increases from Howard de Walden’s medical sector, where lease lengths are typically longer than other commercial uses. After several years of weak growth, residential income increased by 5.6% due to lower voids and slightly higher rental values. Office rents, which had risen strongly in recent years eased to a small uplift of 1.8% while retail & leisure rents increased by 3.0%.

During the financial year, the value of the investment properties – which encompass the shopping destination of Marylebone High Street and the medical hub of Harley Street – was up 1.6% on an overall basis to £4.678bn but fell 2.7% when capital additions and disposals were excluded.

The pre-tax headline profit of £46.2m was significantly lower than the previous financial year (2019: £160.9m) because of the decrease when revaluing investment properties. This was the first valuation decrease recorded by Howard de Walden since 2009.

The business has recently undertaken individual discussions with its retail, hospitality and leisure customers and provided rental concessions. It is keen to support those businesses which are demonstrating a firm recovery plan, but which are temporarily constrained owing to cash depletion caused by lockdown and have little or no access to government support. Rent deferrals have also been agreed with some medical and office occupiers who have been adversely impacted by social distancing guidelines.

Howard de Walden Chairman, Sir William Proby, commented: “Faced with this entirely new threat to our business, we have had to learn rapidly how to cope with the ever changing circumstances and stream of Government advice. I am glad to report that we moved quickly to support our colleagues, customers and the community”.

At a time which is imposing massive stresses on society, the business has responded by increasing its charitable contributions which, in the current financial year, are heading towards £1m. This funding has been in part created by a reduction in the base salaries of the Executive Directors which has been redirected to worthy charity and community causes.

Howard de Walden Chief Executive, Andrew Hynard, commented: “Managing and mitigating the extraordinary impact of COVID-19 has somewhat overshadowed our financial performance through to the end of March, but these results do illustrate the inherent diversity and strength of our business. We expect this to stand us in good stead during what will be a very challenging immediate future.

“This has been a time when listening to our customers and communities has been of paramount importance. We are taking action to stabilise the situation wherever we can and looking to minimise the long-term impact of the pandemic”.