GPOR’s FY results are c.2% ahead of our expectations. FY EPRA NTA fell 10% to 779p, led by an 8.7% LfL reduction in the value of the portfolio. The resilience and growth in office rental values in H2, was ahead of our expectations and the main driver of the higher than forecast EPRA NTA. Management’s office rental value guidance for FY22 is 5% to -2.5%. Financial risk remains very low with LTV of 18.4%, leaving significant capacity for investment. Following recent positive share price performance, the shares now trade at an 8% discount to March-21 NTA, tighter than closest peer Derwent London. We expect a modest reduction in EPRA NTA over the next 12 months, principally due to further declines in retail rental values. TP 700p is a 5% discount to our ‘bottom of the cycle’ NTA.
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