Segro makes 'good progress'

27th Apr 2010 08:01

Industrial property group Segro has found the occupier market tough going in both the UK and Continental Europe since the end of 2009, but says it's made encouraging progress in a number of areas.Investment markets continued to recover in the UK, while capital values in Continental Europe appear to be stabilising, particularly for prime assets, according to the company.The number of enquiries has increased in both regions compared with the first three months of 2009 and the UK business has a "healthy" leasing pipeline going into the second quarter.A lack of new supply has also prompted it to recommence its development programme in response to specific occupier demand, with a carefully selected number of pre-let developments.Speculative development of a number of small light industrial schemes is expected to begin in Continental Europe later in the year, subject to market conditions."Whilst conditions in occupational markets remain challenging, we have made good progress on a number of fronts in the early part of 2010," boss Ian Coull said.The group reported a loss of £234.1m for the year ended 31 December compared with a £938.1m loss last time. Separately, Segro has exchanged conditional contracts for the acquisition of BAA's 50% interest in the Airport Property Partnership (APP) for £111.3m cash. APP is a 50/50 joint venture with Aviva Investors, focused on airport-related industrial assets in and around major UK airports.