Three UK Property Companies Lay Out Pandemic Losses

Across the United Kingdom, property companies have been gravely affected by the COVID-19 virus and the government's response.

Three companies laid bare how they are fairing and the extent of the impact on the UK market.

The pandemic hit property valuations and customer interest. Tenants of commercial properties have scaled down their needed space as more people have opted to work from home. Construction companies have halted or delayed on their operations.

Great Portland Estates, the London landlord company, has revealed that their portfolio has gone down to a value of 6 per cent overall.

With more vacancies available in central London, the value of their properties has gone down less by 18 per cent.

Speaking to Financial Times, CEO Toby Courtauld said, "It is clear that the impact of the Covid crisis will persist longer than we hoped.

With unemployment rising, albeit, from a low level, we should expect rents and capital values in London to fall further."

In the same report, the company shares that their rent collection rate is at 80 per cent for September. From their data, it shows that offices are more capable of paying rent compared to the retail and hospitality industries.

The retirement housebuilder company McCarthy & Stone has accepted a £630m offer from Lone Star, a private equity company.

In comparison to 2019, when the company completed 2,402 units, it has now only sold 832 to date.

The company released a statement saying, "Sales have remained subdued as the behaviour of our customer base, which has an average age at the time of purchase of 79, has been more cautious than the broader population due to the risks associated with Covid-19."

Workspace, the company that offers flexible office spaces, has also recently written down its portfolio value. Their properties are now 5 per cent less compared to March.

With occupancy rates and rents down, the board awaits its full-year results to decide on landmark matters such as dividends.