Derwent London: HY26 preview (6 Aug) - Capital recycling

研报英文原文证据摘录

Derwent London: HY26 preview (6 Aug) - Capital recycling

Derwent London (DLN LN)

Equity Research

July 15, 2026

The Long View: Derwent London

Investment Thesis Risk/Reward - 12 Month View

• Expect London office markets to become increasingly two-tier, with

Upside : Downside

Grade A resilient and experiencing growth and Grade B weaker. 2600 1 : 1.88

• Expect grey space to open up further in central London offices where 2400 2400 (+18%)

tenants reduce planned expansion, meaning subletting and landlords

lose pricing power. 2200

• Expect consumer spending to come under further pressure, meaning 2000

negative retail tenant sales movements and, therefore, downward 1800

(-20%) pressure on rents. 1600 1629

1400 1350 (-34%)

2025 2026 +12 mo.

Base Case, Upside Scenario, Downside Scenario,

1629p, -20% 2400p, +18% 1350p, -34%

• Expect sales of smaller buildings where there • Market is less challenged by rising interest • The expected ‘wall of liquidity’ from value

is greater liquidity. rate costs, with buyers such as sovereign investors does not absorb the expected debt

• Acquisitions will be opportunistic, but unlikely. wealth funds returning to the market and refinancing cycle and leads to asset value

• Expect development pipeline to have added creating more demand for prime office erosion.

fewer schemes than previously forecast buildings, meaning further upside to DLN’s • Subletting means more aggressive markdown

beyond the onsite developments. office capital values. in rents than expected.

• PT based on DCF Valuation. • Remaining developments let strongly, • Remaining speculative developments

meaning lower risk to the current pipeline. struggle to let, and costs taken through

• UK economy returns to more robust income statement put dividend under