Rotherham-based land developer Harworth Group plc said it is on track to reach £1 billion EPRA NDV by the end of 2027.
EPRA NDV stands for European Public Real Estate Association Net Disposal Value.
In a half-year trading update, Harworth said EPRA NDV at June 30 is expected to be moderately higher than at the end of 2023 (£662.9 million) “reflecting positive valuation movements across the group’s land and property portfolios.”
Harworth reported strong progress on land sales with 86% of budgeted sales completed, exchanged or in heads of terms and said sales proceeds will be largely reinvested into the group’s Industrial & Logistics development programme.
“Planning progress, disposals ahead of book value and positive revaluations drive moderate EPRA NDV growth and the group expects EPRA NDV as at 31 December 2024 to be broadly in line with current market consensus …” said the firm.
“Exchanged contracts for the conditional sale of 48 acres of serviced land at Skelton Grange to Microsoft for £107 million, representing an IRR of over 40% and a significant premium to the 31 December 2023 book value of £52 million …
“Excluding the sale at Skelton Grange, completed, exchanged, or in heads of terms on 86% of budgeted sales for the year, broadly in line with, or at a premium to, 31 December 2023 book values …
“Planning permission achieved for 1.8 million sq. ft. and 500 plots, and up to a further 1.5 million sq. ft. and 150 plots post period end, alongside new draft allocations or allocations in local plans for 5.7 million sq. ft. and 2,875 plots …
“Extensive existing pipeline now has the potential to deliver 38.8 million sq. ft of Industrial & Logistics space and 26,639 plots for new homes …”
Harworth Group CEO Lynda Shillaw said: “Harworth has continued to deliver against its growth strategy to reach £1 billion EPRA NDV by the end of 2027 and we recently announced our intention to grow the Investment Portfolio to £0.9 billion by the end of 2029.
“This growth will largely be driven by our existing Industrial & Logistics pipeline, which now totals 38.8 million sq. ft. and will see the delivery of strategically positioned Grade A assets we intend to retain and hold.
“This has been another strong first half for planning approvals and land sales, the highlight being the exchange of contracts on a £107 million serviced land sale to Microsoft at a significant premium to book value, our largest transaction to date.
“We continue to see strong demand for Harworth’s serviced land and employment spaces, with the recent momentum in serviced land sales highlighting the strength of our markets and these sales provide a stable funding channel for our Industrial & Logistics development programme.
“The recently announced evolution of our strategy sets a clear direction for the Group. It reflects our strong conviction in the demand for Industrial & Logistics space in our regions which is underpinned by limited supply, and our ability to unlock the significant embedded value in our extensive development pipeline to meet our growth targets.”