First Property leases another 9pc of Gdynia office building

Property fund manager and investor First Property Group has leased a further 1,115 square metres, or 9% of the net internal area, of its office building in Gdynia, Poland, it announced on Wednesday.

The AIM-traded firm said that once fit-out works were complete and the premises handed over to the tenant, expected in January, the building would be 28% occupied.

By comparison, 18 months ago following the expiry of the lease to the former sole tenant, the building was 97% vacant.

The company said the rent and service charges payable by tenants would, once fit-outs were complete and rent-free periods expired, exceed €65,000 per month or about €0.8m per year.

That would result in a net operating loss from the building of about €2,500 per month, or €30,000 per year.

When fully let, First Property said it expected the building to yield rent of around €2.1m each year.

“The speed at which we are making leasing progress at our office building in Gdynia, against significant market headwinds, is testament to the underlying strength of the Polish economy, this building's location, the quality of space on offer and our leasing team,” said chief executive officer Ben Habib.

At 1052 BST, shares in First Property Group were up 3.7% at 28p.

Reporting by Josh White at Sharecast.com.