Great Portland Estates It continues...strong demand for the best space: 1Q27 First Take

Research evidence excerpt

Great Portland Estates It continues...strong demand for the best space: 1Q27 First Take

Neil Green, CFA AC Europe Equity Research

(44-20) 7134-4478 02 July 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

leaned into this supply shortage, and is now on track to develop (and lease) some prime

London office assets. In the near (and medium) term, the potential for disposals is also there,

with plans for the current year. Upon completion of sales, GPE has flagged the potential for

a capital return to investors. The group also has a 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