Pre-tax profits rise at Town Centre Securities

Edward Ziff

Town Centre Securities, the Leeds-based property investor and car park operator, has reported a half-year pre-tax profits rise to £12.4m. 

The firm said the statutory profit rise from £2.6m in the same period for 2016 to £12.4m in 2017 included a £6.4m gain from net movement on investment property valuation.

TCS said its EPRA, European Public Real Estate index, pre-tax profits decreased 4.6% to £4m (2016: £4.2m) following strategic disposals.

The firm reported a loan to value ratio of 47%. In 2016 this stood at 50% and on 30 June 2017 was reported as 49%.

Several areas of the firm’s latest development programme was successfully delivered in the period up to 31 December, including the completion of ibis Styles and Premier Inn hotels in Leeds and practical completion of the Merrion House development, which was achieved on 29 January, on time and budget. 

TCS said this completed a £70m ten-year Merrion Centre development and improvement programme. 

It pipeline of opportunities include Burlington House, a 91-unit residential development in Manchester’s Piccadilly Basin which is under construction, with practical completion expected in May 2019. 

Eider House, the second Piccadilly Basin residential development, which has detailed planning approval. 

Town Centre Securities also recently announced a joint venture with Leeds City Council for construction of an 128 unit apart-hotel with retail units alongside Leeds City Market and Victoria Gate. 

Disposals made during H1 2018 totalled £7.7m, taking sales over the last 12 months of five properties sold for over £25m; providing capital to invest in the firm’s development programme.

TCS said: “On an annualised basis the combination of our two new hotels in Leeds and the increase in Merrion House rents will more than offset the £1.5m income lost due to these disposals.”

Town Centre Securites also runs CitiPark, which it said continued to deliver income and profit growth year on year, with promising improvements being seen in recently acquired operations.

CitiPark’s operating income of £5.8m is 5% up year on year, with operating profit of £2.1m up 1%.

The parking division of TCS has recently taken a further 5% stake in, taking its share to 15%. The firm said: “TCS is very excited about the prospects of this business, a website and mobile application that matches customers to available car parking spaces across the UK.”

TCS has appointed Jeremy Collins as an independent non-executive director in the period.

 Edward Ziff, chairman and chief executive of TCS, said: “We are very pleased with the results for the first half of the year, with an increase in the value of our portfolio driving an improved statutory profit. To have maintained EPRA profitability close to last year’s levels, despite a significant level of strategic disposals and continued investment in our business, demonstrates the strength of the recently completed development programme.

“We continue to successfully progress considerable change within our portfolio. The combination of asset recycling, intensive asset management, and a strong development pipeline ensure that our future potential is being enhanced, whilst providing new opportunities for growth in income and capital values. These opportunities require funding, and having self-funded over £85m of investment in recent years, we are exploring how we might fund investments in our future growth.

“The strength of our portfolio, and the success of the most recent development phase have allowed us to be bold in the sale of more mature assets. Furthermore, the strength of our CitiPark business continues to support financial delivery, whilst also bringing new opportunities such as We look forward to the future with confidence.