Great Portland Estates FY26 Conf. Call: Executing… watch for disposals this year and potential capital returns.

Research evidence excerpt

Great Portland Estates FY26 Conf. Call: Executing… watch for disposals this year and potential capital returns.

Neil Green, CFA AC Europe Equity Research

(44-20) 7134-4478 21 May 2026 C A Z E N O V E

neil.d.green@jpmorgan.com

Investment Thesis, Valuation and Risks

Great Portland Estates (Overweight; Price Target: 400p)

Investment Thesis

We are Overweight Great Portland as we expect severe supply shortages of prime London

office space, especially in the West End, to support rental growth in almost any economic

environment, driven by tenants being pushed into new office space by ESG requirements,

as well as re-allocating space to collaborative, client facing environments. Great Portland

has the highest committed development spend on London offices as a percentage of assets,

a very strong balance sheet and excellent management.

Valuation

Our Dec-27 price target for Great Portland is based on our total returns-based European

Valuation Model, which takes into account whether a company creates or destroys value.

We argue that companies that have a positive spread between returns and their weighted

average cost of capital (WACC) should trade at a premium to NNAV, whereas those with

a negative spread should be priced below NNAV. We apply this spread to the invested

capital, discount back and add/subtract to our NNAV forecast to derive our price target.

Risks to Rating and Price Target

Downside risks include a later-than-expected pick-up in occupier sentiment and a further

increase in required returns across asset classes and/or bond yields. Other downside risks

include weak performance in letting up new developments and extreme cost inflation. The

main risk is around an extremely severe UK recession affecting employment markets to the