Songbird Reports Higher Net Asset Value for First Half

Songbird Estates Plc, the company that controls London’s Canary Wharf financial district, reported higher first-half net asset value and said there’s been a pick-up in interest from potential tenants.

Adjusted net asset value rose to 2.23 pounds per share as of June 30 from 2.10 pounds at the end of last year, the London-based company said in a statement today. Rental income climbed to 134.6 million pounds ($213 million) from 130.3 million pounds a year earlier.

“The retail portfolio again performed strongly, increasing in value by 6.7 percent in the period, reflecting a slight hardening of yields, progress with the expansion of Jubilee Place mall and growth in passing rents,” Chairman David Pritchard said in the statement. “Activity in the office letting market is improving.”

Canary Wharf Group Plc, in which Songbird has a 69 percent stake, has been broadening the types of properties it builds and expanding outside the financial district. Leasing at Canary Wharf was “subdued” in the first half and has since improved, with tenants including Royal Dutch Shell Plc agreeing to rent about 100,000 square feet (9,300 square meters) of space so far this year, Pritchard said.

Songbird gained 6.8 pence, or 4.5 percent, to 158 pence in London, the highest since June 2011. The shares have climbed 33 percent this year, raising the company’s market value to 1.17 billion pounds.

Shell Building

U.K. Communities Secretary Eric Pickles asked Sept. 4 to review plans by Canary Wharf Group and Qatar’s sovereign-wealth fund to construct offices and 877 homes at the site of Royal Dutch Shell’s London headquarters in the Waterloo district near the London Eye Ferris wheel.

“We firmly expect the review will start this year,” Pritchard said on a call with reporters. The letter from the department “was actually very broadly based and we had, of course, designed the thing with those sorts of issues in mind, so it was therefore surprising to find it was called in.”

Canary Wharf’s developments include the skyscraper known as the Walkie Talkie in the City of London district. The cost of fixing a ray of light from the building that melted parts of a car parked outside is likely to be “in the low single-figure millions” of pounds, Pritchard said.

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