Pre-tax profits climb at TCS
SIGNIFICANT progress on major projects has helped property group Town Centre Securities (TCS) see a robust rise in its pre-tax profits.
In its results for the year ended June 30 2013, the Leeds-based property investment and development company announced statutory profit for the year, after revaluation, of £3.6m, compared to a loss of £4.2m last year.
The company said its largest asset, the Merrion Centre in Leeds city centre, saw growth in value of 2.75% to £116.1m with a 2% rise in passing rent. It said 60% of the projected income at its £13m New Front scheme at the centre is now committed.
Chairman and chief executive Edward Ziff, said: “The company has once again produced a good set of results despite a weak economic background. We have made significant progress during the year on a number of major projects, made four acquisitions and occupancy is at an all-time high.
“Our decision to invest in major cities continues to be a sound strategy during these economic times. Whilst economic data now shows that there was no double dip, there is no doubt that confidence is fragile and that a full recovery is some time away. We are encouraged by signs of improvement but remain focussed on progressing development opportunities on assets we own and other value enhancing projects.”
The group reported underlying pre-tax profit of £7.3m (2012: £7.3m) (excluding property revaluation, exceptional items and property disposal) which it said is in line with expectations. TCS reported on a like-for-like basis, a £1m increase in the value of its investment portfolio. Revenue was up to £22.4m, from £22m last year.
TCS said its property portfolio is valued at £301m (2012: £287.6m) and it has purchased four properties during the year for £11.6m. It also announced that it owns 100% of a former joint venture, which brought five smaller properties into the portfolio.
Ziff said: “We have made significant progress during the year on a number of major projects. At the Merrion Centre our retail and leisure project opposite the new Leeds Arena is taking shape. We are on programme to complete this first phase by December representing a capital commitment of £8m. This will create an additional 50,000 sq ft of accommodation with an ERV of £0.65m per year.
“Tenant demand has been encouraging with over 60% currently pre-let and with a further 10% in solicitor’s hands. The second phase of the scheme will refurbish the existing 1,100 space multi-storey car park and is due to commence in the early part of 2014.”
TCS said at the end of June 2013 its occupancy level across the portfolio was 98% (June 2012: 97%) and overall property income increased to £17.5m.
The group also operates Town Centre Car Parks, which runs eleven car parks and over 5,000 spaces in Leeds and Manchester. Revenues increased to £4.93m, delivering underlying profits of £2.4m (2012: £4.86m and £2.3m respectively).
TCS said other highlights of the year include detailed consent for a 126-bed hotel on its Whitehall Riverside site in Leeds and a revised outline application on the remainder for 450,000 sq ft of commercial offices together with a 500 space multi-storey car park which has been lodged. Agreement has been reached with Leeds City Council to refurbish and extend Merrion House at the Merrion Centre, which will become its principal office building in the city and the single point of call for all customer enquiries.
Ziff added: “We have delivered another stable year and believe we are well placed for what appears to be a gradual return to economic growth.”
