Improving property market sees surge in profits for Mucklow
DEVELOPER A&J Mucklow has seen its profits nearly double in the six months to December 31.
Its half yearly report to the London Stock Exchange revealed statutory pre-tax profit of £27.4m, compared to £14.2m in the corresponding period in 2013.
Gross rental income received stayed static at £10.5m while net debt was down slightly at £65.4m compared to £66.8m at the end of June 2014.
The value of the Halesowen-based developer’s property portfolio was up at £323.7m compared to £298.9m at the end of June 2014. The occupancy rate was slightly up at 94.3% (June 2014: 93.3%).
Chairman Rupert Mucklow said: “I am pleased to report another strong performance by the group for the first six months of our financial year.
“The improvement in regional occupier and investment markets that we reported in the previous half year to 30 June 2014 continued through to 31 December 2014, which has resulted in a lower vacancy rate, positive signs of rental growth and further yield compression.
“We completed our 116,000 sq ft pre-let development at Apex Park, Worcester during the first half year, which was on time and budget. We also achieved a number of open market lettings on second hand industrial space at the highest rental levels we have achieved for 15 years.
“Property yields are still falling on the back of strong institutional demand and a shortage of investment stock. Our modern property portfolio is now valued on a 7.5% equivalent yield and continues to provide us with a variety of opportunities to add value and increase rental income.”
Mucklow’s most notable letting during the period was a 36,000 sq ft industrial unit at Redfern Park, Tyseley, Birmingham. The property was acquired with vacant possession in the previous half year for £1.54m and refurbished at a cost of £0.2m.
The property was let in October 2014 on a 20 year lease without any breaks at a rent of £0.21m pa (£5.75 psf).
