Wates sees City property pick-up

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INTEREST from potential tenants in property in the City has picked up in the past few weeks, according to Wates City of London, the only British property company to hold all its assets there.

The pick-up is most obvious in the traditional core of the City where supply is limited, it said. Wates is one of the first companies to signal an improvement in the letting market, though others have pointed to signs of recovery in the investment market.

John Nettleton, finance and commercial director, said there was more 'meaningful discussion with people who are looking for a substantial amount of space'.

He estimates that there are only three or four properties of more than 200,000 square feet in the heart of the City, including Wates' City Place House, Basinghall Street, which is complete and looking for tenants.

Wates' comments came as it reported an 18.4 per cent fall in pre- tax profits to pounds 3.7m in the first half of the year. The decline was largely due to an increase in interest charges from pounds 1.4m to pounds 3.2m following the acquisition of another property in Basinghall Street.

Earnings per share fell from 2.36p to 1.95p and the interim dividend was held at 0.77p. The group said it would 'review the payment of a final dividend at the year end'.

Meanwhile, London & Metropolitan, which was rescued by its bankers last year, lost pounds 26m before tax in 1991. That compared with a pounds 100.3m loss the year before, after pounds 88.8m of exceptional items.

Its bankers have agreed to extend working capital facilities for a further year. Debt rose from pounds 106m to pounds 129m, largely because of expenditure on its golf and leisure development in the south of France, while net liabilities increased from pounds 22m to pounds 40m.

The group provided almost pounds 5m against its office building in Smithfield, London, which is still unlet. It sold properties worth pounds 26m during the year, at prices within 10 per cent of book value.