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UK industrial property group Segro said on Friday it completed record amounts of new warehouse space in 2016 to meet strong demand from retailers adapting to online sales.
“We have had a record year for development completions, delivering 422,000 sq m of new warehouse space, of which 80 per cent is now let,” said David Sleath, chief executive.
The FTSE 250 group added that “occupier demand remains strong from a broad range of business sectors, particularly from retailers adapting their supply chains to the rapid growth of internet retailing. The result of the EU referendum has had little apparent impact.
In the year to the end of December, the value of Segro’s net assets per share rose 8 per cent to 500p, while earnings per share were up 7.1 per cent to 20p.
Investors have favoured logistics property over the past year, viewing it as a way to tap into the growth of e-commerce and convenience stores: while other types of property took a hit to confidence from the vote to leave the EU, Segro’s share price is now 8 per cent above its pre-referendum level.
The £4bn group, which owns warehouse sites across Europe, raised £325m from an equity placing in September and plans to spend £300m on new development this year.
The group will increase its final dividend by 5.7 per cent to 11.2p.