Our opinion on the current state of SHC

28 nov 2023

Shaftesbury Capital is a real estate investment trust (REIT) which invests in properties in London's West End including Covent Garden, Carnaby, Chinatown and Fitzrovia. It has a property portfolio worth GBP4,9bn and 2,9m square feet of lettable space in 2000 buildings. The share is listed on the London Stock Exchange (LSE) and on the JSE. The share is obviously a rand hedge, but it has been on a protracted downward trend. In a trading update on 14th June 2023 the company said, "Against a backdrop of macroeconomic uncertainty, demand for space in our West End locations continues to be strong across all uses, with 173 leasing transactions completing in the first five months of the year, at rents on average 6 per cent ahead of December 2022 ERV providing confidence for rental growth prospects". In a further trading update on 27th November 2023 the company reported that, "Year to date, 440 leasing transactions were completed, representing £30.2 million of rent, nine per cent ahead of 31 December 2022. Robust balance sheet with access to approximately £500 million of liquidity1 and EPRA LTV1 of 30 per cent (30 June 2023: 31 per cent)". The company's vacancy rate was 2,2%. Technically, the share has been in a downward trend since the beginning of 2016. We recommend waiting for it to break convincingly up through its long-term downward trendline.