Revenues top £30m at listed property development and car parking firm

Listed Leeds property investment, development and car parking company Town Centre Securities (TCS) has seen revenues top £30m and pre-tax profits rise to £18m  in a year which the firm continued to move away from retail and leisure.

TCS today published its final results for the year ended 30 June 2018, with revenues of £30m, up from £27.5m last year, and pre- tax profits up to £18.3m from £6.7m.

However, the firm’s EPRA profit before tax was down 1.9% to £6.9m (2017: £7m), which Town Centre Securities said was due to timing of strategic disposals.

Its full year dividend increased to 11.75p (2017: 11.50p). TCS added that it had now held or improved its dividend every year for the past 58 years. The estimated total potential Gross Development Value of the company’s pipeline now stands at over £580m

Chairman and chief executive, Edward Ziff, said: The business has undergone considerable change in recent years as part of a strategy to reposition the portfolio, ensure a resilient income stream, and to unlock growth for the future. In the past two years we have reduced our exposure to retail and leisure from 70% to 55% of the portfolio. We are very pleased with the progress made and feel confident about the future.

“In those two years we have disposed of over 8% of the portfolio, during which time we have managed to hold EPRA profitability broadly flat and have increased NAV by 8%. Furthermore, we have strengthened the balance sheet, improved our banking facilities and lowered leverage. Our recent financing activity increased capital headroom, however we continue to explore new capital raising options in order to facilitate our significant development pipeline.”

During the year, the firm secured headroom of over £30m following its Merrion House financing and Ducie House purchase in July 2018 (2017: £12m). It continued its Merrion Centre development to further enhances its mixed-use status; recently announcing the upcoming opening of restaurant, Arnolds.

Merrion House, a 170,000 sq ft office, was completed and fully occupied by Leeds City Council, its joint venture partner. The listed firm recently acquired The Cube for £12m, a high yielding mixed use property in Leeds city centre.

TCS is also  in the process of entering into new Joint Venture with LCC for development of an apart-hotel on George Street alongside Victoria Gate and Leeds City Market

In Manchester, the firm moved on with its Piccadilly Basin site. Seven properties sold 6% above valuation for over £32m in the last two years, with three of those sold for £10.1m in the last financial year. Ducie House in Manchester purchased in the last financial year for £9m.

TCS said its CitiPark business continues to grow organically, with income up 5% year on year – despite business rates increasing. Its investment now stands at an 15% equity stake.

Richard Lewis has also announced his retirement

Property Director Richard Lewis, who has been with the Company for 18 years and joined the Board in 2001, also announced his plans to retire. Ziff added: “His contribution has been outstanding, beginning with the construction and sale of No1 Whitehall Riverside in Leeds, the continued development of Piccadilly Basin in Manchester, and most recently the re-development of Merrion House in Leeds. We will miss Richard and wish him a long, happy, and healthy retirement.”

TCS has appointed Lynda Shillaw as the new Property Director, who joins Town Centre Securities from Manchester Airports Group (‘MAG’) where she has served as the Divisional Chief Executive Officer, Property since June 2014.

Shillaw is a member of the MAG Executive Committee, responsible for MAG’s £525m Investment portfolio and 1,000-acre development land bank across its four UK airports, and also MAG’s interest in the £1bn Airport City Joint Venture.  Prior to MAG, she had been Director of Real Estate at Scottish Widows Investment Partnership, Managing Director and Global Head of Corporate Real Estate for Lloyds Banking Group, Managing Director of Co-Operative Estates, and Director of Property at BT plc. Lynda holds Non-Executive Director positions on the board of the Crown Estate and VIVID housing association. Lynda joins the Company and Board in November 2018.