At last - Canary Wharf breaks into profit as new tenants line up

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The Independent Online

Canary Wharf, the fast-expanding property development in Docklands, east London, that had to be rescued from bankruptcy in the mid-Nineties, yesterday confirmed the turnaround in its finances with an announcement of its first full-year profit.

Canary Wharf, the fast-expanding property development in Docklands, east London, that had to be rescued from bankruptcy in the mid-Nineties, yesterday confirmed the turnaround in its finances with an announcement of its first full-year profit.

The company also said a 80,000 sq ft Waitrose Food & Home store will anchor a new retail building to be added to the Canada Place Mall shopping complex at the site. The 200,000 sq ft mall building will also house a 90,000 sq ft health club.

Retail space at Canary Wharf will, when finished in late 2002, exceed 500,000 sq ft, the size of a small regional shopping mall. Saturdays are already the biggest revenue day for the shops at Canary Wharf.

The company said it was two years ahead of its business plan and reported a pre-tax profit of £54.1m for the year ended 30 June, compared with a loss of £42.8m previously. The performance was driven by profit on the sale of completed properties, increased rental income and a reduction in interest payments.

Paul Reichmann, Canary Wharf's chairman, said: "This year has been the most successful year in our history."

Canary Wharf shares hit their highest level since flotation 18 months ago, closing at up 5.5p at 535.5p. The company said the net realisable value of its estate, which includes an estimated value for property under construction discounted back to present value, was 531p a share, up from 474p previously.

This figure is already out of date, not reflecting, for instance, increased value brought about by an agreement, signed since the year end, of a contract with the law firm Clifford Chance to pre-let 750,000 sq ft of a new 1 million sq ft building.

Canary Wharf has 6.2 million sq ft of buildings under construction, due to be completed by 2005, which would more than double the 4.8 million sq ft size of the current complete estate. The development will eventually provide space for 90,000 workers.

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