Segro increases Q1 rents; trading in line with expectations

UK real estate investment trust Segro said it had contracted £8.6m of new rent in the first quarter compared with £6m a year ago.

In a trading statement, it added that pre-lets doubled to £3.6m. Vacancy rates increased slightly to 5.1% from 4.8% in the last quarter of 2015.

Chief executive David Sleath said 2016 was progressing well and in line with expectations.

“Occupier demand for good quality, modern warehouse space in key locations remains encouraging and we have had another strong quarter of signing up new rental commitments, showing a healthy improvement compared to the equivalent period last year driven by pre-let agreements and letting up space developed speculatively,” he said.

"Whilst real estate investment volumes generally in the first half of 2016 are expected to be much reduced on 2015, recent transactions suggest that investor demand for high quality, well located warehouses remains strong."