Half Year 2026 Tritax Big Box REIT PLC Earnings Call

August 6, 2026

Speaker #1: Good morning, and welcome to our results presentation for the first six months of 2026. I'm Colin Godfrey, CEO of Tritax Big Box. As usual, I will kick off with our key messages before Frankie, our CFO, provides an update on our financial and operational performance.

Colin Godfrey: Good morning, welcome to our results presentation for H1 2026. I'm Colin Godfrey, CEO of Tritax Big Box. As usual, I will kick off with our key messages before Frankie, our CFO, provides an update on our financial and operational performance. I'll then outline the substantial strategic progress that we've made in the period before opening the lines for Q&A. The key message that I want to deliver this morning is that we're exceptionally well-positioned to take advantage of the significant opportunities inherent within our business and the broader market. We continue to deliver against our key growth milestones and with a near doubling of secure power for our data center pipeline, we're increasing our EPS growth ambition to 65% by 2031 or sooner from 50% by 2030.

Speaker #1: I'll then outline the substantial strategic progress that we've made, in the period before opening the lines for Q&A. The key message that I want to deliver this morning is that we're exceptionally well-positioned to take advantage of the significant opportunities inherent within our business and the broader market.

Speaker #1: We continue to deliver against our key growth milestones, and with a near doubling of secure power for our data center pipeline, we're increasing our EPS growth ambition to 65% by 2031 or sooner.

Speaker #1: From 50% by 2030. The first half of 2026 has been defined by strong execution and a series of important strategic milestones across the business.

Colin Godfrey: H1 2026 has been defined by strong execution, a series of important strategic milestones across the business. Active asset management and capture of rental reversion has delivered strong income growth, we've been doing this at pace. Supported by a successful disposal program, we've recycled capital from lower returning assets to generate superior risk-adjusted returns and provide a key source of funding flexibility. Since January 2023, we have redeployed more than GBP 1 billion into higher returning opportunities. In development, our agile platform continues to create future income opportunities at attractive yields on cost, allowing us to align development activity with market conditions and allocate capital selectively. Just 18 months after entering the data center sector, we have already made meaningful capital value development gains, which will be followed by significant rental income and earnings growth as schemes are delivered.

Speaker #1: Active asset management and capture of rental reversion has delivered strong income growth, and we've been doing this at pace. Supported by a successful disposal programme, we've recycled capital from lower-returning assets to generate superior risk-adjusted returns and provide a key source of funding flexibility.

Speaker #1: Since January 2023, we have redeployed more than $1 billion into higher-returning opportunities. In development, our agile platform continues to create future income opportunities at attractive yields on cost, allowing us to align development activity with market conditions and allocate capital selectively.

Speaker #1: Just 18 months after entering the data center sector, we have already made meaningful capital value development gains, which will be followed by significant rental income and earnings growth as schemes are delivered.

Speaker #1: Together, these achievements have delivered another period of strong financial performance, with growth in net rental income, earnings, and dividends, which Frankie will cover in more detail shortly.

Colin Godfrey: Together, these achievements have delivered another period of strong financial performance with growth in net rental income, earnings, and dividends, which Frankie will cover in more detail shortly. They demonstrate the earnings power of our platform and the significant opportunity ahead as we continue to progress towards our long-term earnings ambition. Yesterday afternoon, we announced the exciting news that we have secured a further 235 megawatts of power for our data center pipeline. This is another major milestone, building on the successful granting of planning permission at Manor Farm in the period. This incremental power is phased for delivery in 2030 to 2031 and nearly doubles our secured power to 507 megawatts. It is connected to two additional schemes, which have the potential to deliver exceptional risk-adjusted returns with a yield on cost of between 9% and 11%, and a profit on cost in excess of 50%.

Speaker #1: They demonstrate the earnings power of our platform and the significant opportunity ahead as we continue to progress toward our long-term earnings ambition. Yesterday afternoon, we announced the exciting news that we have secured a further 235 megawatts of power for our data center pipeline.

Speaker #1: This is another major milestone, building on the successful granting of planning permission at Manor Farm in the period. This incremental power is phased for delivery in 2030 to 2031, and nearly doubles our secured power to 507 megawatts.

Speaker #1: It is connected to two additional schemes, which have the potential to deliver exceptional risk-adjusted returns. With a yield on cost of between 9% and 11%, and a profit on cost in excess of 50%, the proposed equity issue unlocks the next wave of the data center pipeline.

Colin Godfrey: The proposed equity issue unlocks the next wave of the data center pipeline, securing the early stage and longer-term CapEx requirements of these two schemes, complementing our ongoing capital recycling program. These two new schemes give us the potential to nearly double our expected data center rental income from the GBP 58 million that we announced for the Manor Farm and Chelmsford projects to between GBP 107 and 119 million. It is this additional opportunity which gives us the confidence to increase our adjusted EPS growth ambition to 65% by 2031 or sooner, up from 50% by 2030. Given commercial sensitivities, as was the case with Chelmsford, we are not disclosing the precise locations of these two new schemes. However, they are both in the prime Greater London availability zone.

Speaker #1: Securing the early-stage and longer-term capex requirements of these two schemes complements our ongoing capital recycling program. These two new schemes give us the potential to nearly double our expected data center rental income from the £58 million that we announced for the Manor Farm and Chelmsford projects to between £107 million and £119 million.

Speaker #1: It is this additional opportunity which gives us the confidence to increase our adjusted EPS growth ambition to 65% by 2031 or sooner, up from 50% by 2030.

Speaker #1: Given commercial sensitivities, and as was the case with Chelmsford, we are not disclosing the precise locations of these two new schemes. However, they are both in the prime Greater London availability zone.

Speaker #1: This is further evidence that our power-first approach is working, creating exciting prospects in data centers with the potential to deliver exceptional risk-adjusted returns across a current total opportunity of over 1 gigawatt of potential power capacity.

Colin Godfrey: This is further evidence that our Power First approach is working, creating exciting prospects in data centers with the potential to deliver exceptional risk-adjusted returns across a current total opportunity of over 1 gigawatt of potential power capacity. With that, I will hand over to Frankie to cover the financial and operational review. Frankie.

Speaker #1: With that, I'll hand over to Frankie to cover the financial and operational review. Frankie? Thank you, Colin, and good morning, everyone. This first half reflects another strong period of disciplined execution across the business, with consistent delivery across asset management, capital recycling, and progress with our development opportunities.

Frankie Whitehead: Thank you, Colin, and good morning, everyone. This H1 reflects another strong period of disciplined execution across the business, with consistent delivery across asset management, capital recycling, and progress with our development opportunities. This has translated into strong earnings growth, along with creating significant future opportunities to deliver value to shareholders. Starting with the headlines. The portfolio generated 5.1% EPRA like-for-like rental growth, more than double the level of the prior period. Adjusted EPS, excluding all DMA income, increased by 7% to GBP 0.0441. The dividend grew to GBP 0.04 per share, a 4.4% increase. Our portfolio value was GBP 7.7 billion, reflecting net disposals and modest valuation movements, resulting in a 1% reduction in EPRA NTA per share to GBP 1.859. Turning to the income statement, which highlights our recurring earnings and dividend growth.

Speaker #1: This has translated into strong earnings growth, along with creating significant future opportunities to deliver value to shareholders. Starting with the headlines, the portfolio generated 5.1% EPRA like-for-like rental growth, more than double the level of the prior period.

Speaker #1: Adjusted EPS, excluding all DMA income, increased by 7% to 4.41 pence. The dividend grew to 4 pence per share, a 4.4% increase. Our portfolio value was £7.7 billion, reflecting net disposals and modest valuation movements.

Speaker #1: Resulting in a 1% reduction in EPRA NTA per share to 185.9 pence. Turning to the income statement, which highlights our recurring earnings and dividend growth.

Speaker #1: Net rental income increased by 16.2% to £173.3 million, driven by the contribution from the Blackstone portfolio, acquired in October 2025, and strong like-for-like rental growth.

Frankie Whitehead: Net rental income increased by 16.2% to GBP 173.3 million, driven by the contribution from the Blackstone portfolio acquired in October 2025 and strong like-for-like rental growth. Operational efficiencies reduced the EPRA cost ratio excluding vacancy costs to 12.2%. This remains one of the lowest in the European real estate sector, as the bottom right-hand chart shows. As a result, operating profit increased by 6.1%. We have taken the opportunity to simplify our disclosure around earnings, which we now quote fully inclusive and fully exclusive of DMA income. Adjusted EPS, excluding all DMA income, increased by 7% to GBP 0.0441. Adjusted earnings per share was also GBP 0.0441, with no DMA income recognized during the period. The dividend represented a 91% payout ratio. The right-hand chart sets out the moving parts of annual contracted rent over the period.

Speaker #1: Operational efficiencies reduced the EPRA cost ratio, excluding vacancy costs, to 12.2%. This remains one of the lowest in the European real estate sector, as the bottom right-hand chart shows.

Speaker #1: As a result, operating profit increased by 6.1%. We have taken the opportunity to simplify our disclosure around earnings, which we now quote fully inclusive and fully exclusive of DMA income.

Speaker #1: Adjusted EPS, excluding all DMA income, increased by 7% to 4.41 pence. Adjusted earnings per share was also 4.41 pence, with no DMA income recognized during the period.

Speaker #1: And the dividend represented a 91% payout ratio. The right-hand chart sets out the moving parts of annual contracted rent over the period. And with the ERV of the portfolio 29% ahead of contracted rent, this shows that, looking forward, there is still plenty of income growth to deliver.

Frankie Whitehead: With the ERV of the portfolio 29% ahead of contracted rent, this shows that looking forward, there is still plenty of income growth to deliver. Our capital allocation framework remains unchanged. We continue to recycle capital from lower returning assets into higher risk-adjusted returns. At 30 June, the LTV had reduced to 32.9%, and when including post-period end disposals, reduces further to 32.1%. Despite some softening in prime yields, EPRA NTA per share declined only 1%, reflecting portfolio resilience and was offset by value created from our active asset management and development activity. We completed GBP 259 million of disposals during the H1, averaging 2% above prevailing book values, and GBP 344 million in the year to date. Just to highlight how effective we have been at funding our strategy in recent years, this takes total disposals over a three and a half year period to over GBP 1 billion.

Speaker #1: Our capital allocation framework remains unchanged. We continue to recycle capital from lower-returning assets into higher risk-adjusted returns. At 30 June, the LTV had reduced to 32.9%.

Speaker #1: And when including post-period end disposals, this reduces further to 32.1%. Despite some softening in prime yields, EPRA NTA per share declined only 1%, reflecting portfolio resilience, and was offset by value created from our active asset management and development activity.

Speaker #1: We completed £259 million of disposals during the half, averaging 2% above prevailing book values, and £344 million in the year to date.

Speaker #1: Just to highlight how effective we have been at funding our strategy in recent years, this takes total disposals over a three-and-a-half-year period to over £1 billion.

Speaker #1: As ever, CapEx invested over the period is reflective of specific circumstances in relation to our development sites. The planning delay at Manor Farm has been well communicated.

Frankie Whitehead: As ever, CapEx invested over the period is reflective of specific circumstances in relation to our development sites. The planning delay at Manor Farm has been well communicated, and this was coupled with a delayed planning decision at a logistics site. Our logistics CapEx, including development and asset refurbishment, therefore, has been lower than anticipated this H1, with a combined GBP 79 million invested. CapEx in H2 is set to increase, and I will update you on how we see the remainder of the year on a later slide. Total accounting returns were impacted by the capital value performance across the portfolio of -0.2% for the period. Our 2.3% earnings yield for the 6 months was partly offset by a combined 0.9% reduction across our investment and logistics development portfolios, as our equivalent yield moved out by 10 basis points to 5.8%.

Speaker #1: And this was coupled with a delayed planning decision at a logistics site. Our logistics capex, including development and asset refurbishment, therefore, has been lower than anticipated this half.

Speaker #1: With our invested Capex, Capex in H2 is set to increase, and I will update you on how we see the remainder of the year on a later slide.

Speaker #1: Total accounting returns were impacted by the capital value performance across the portfolio, of minus 0.2% for the period. Our 2.3% earnings yield for the 6 months was partly offset by a combined 0.9% reduction across our investment and logistics development portfolios, as our equivalent yield moved out by 10 basis points to 5.8%.

Speaker #1: Like-for-like ERV growth remained healthy, however, at 1.9% for the six months. We are now starting to see value delivered from our DC pipeline, with a 0.5% positive contribution in respect of the Manor Farm planning delivery.

Frankie Whitehead: Like-for-like ERV growth remained healthy, however, at 1.9% for the 6 months. We are now starting to see value delivered from our DC pipeline, with a +0.5% contribution in respect of the Manor Farm planning delivery. Together, this produced an underlying total accounting return of 1.6% for the 6 months, and a reported total accounting return of 1.3% after a land option impairment and the Blackstone completion statement true-up effects. Importantly, these returns do not yet reflect the full earnings and shareholder value potential embedded within the business. The benefits from the Blackstone portfolio are only just beginning to flow through. While the most significant value creation opportunities associated with our data center platform remain ahead of us, which I'll talk to in a moment. Looking at our three growth drivers. First, asset management, which continues to deliver attractive and highly visible earnings growth.

Speaker #1: Together, this produced an underlying total accounting return of 1.6% for the six months, and a reported total accounting return of 1.3% after a land option impairment and the Blackstone completion statement true-up effects.

Speaker #1: Importantly, these returns do not yet reflect the full earnings and shareholder value potential embedded within the business. The benefits from the Blackstone portfolio are only just beginning to flow through.

Speaker #1: While the most significant value creation opportunities associated with our data center platform remain ahead of us—which I'll talk to in a moment—now looking at our three growth drivers.

Speaker #1: First, asset management, which continues to deliver attractive and highly visible earnings growth. Across all these events, we have secured 8.6 million pounds of additional annual rental income.

Frankie Whitehead: Across all lease events, we have secured GBP 8.6 million of additional annual rental income, over 50% higher than the same period last year, delivering an average 10.5% uplift in passing rents. With a larger part of the portfolio subject to lease events in the period, this has led to our strong EPRA like-for-like rental growth of 5.1%. In our 2025 annual results, we signaled GBP 26.9 million of potential reversion capture for this year, and we're making good progress looking at the bottom left-hand chart. First, we have captured GBP 6.5 million of rental reversion through lease events in the H1, achieving 100% of the potential that we previously indicated. Second, we have GBP 4.5 million of rental reversion attached to H1 lease events which are currently in progress. To remind you, we have a policy of accruing 75% of this from the rent review date.

Speaker #1: Over 50% higher than the same period last year, delivering an average 10.5% uplift in passing rents. With a larger part of the portfolio subject to lease events in the period, this has led to our strong EPRA like-for-like rental growth of 5.1%.

Speaker #1: In our 2025 annual results, we signaled 26.9 million pounds of potential reversion capture for this year. And we're making good progress looking at the bottom left-hand chart.

Speaker #1: First, we have captured £6.5 million of rental reversion through lease events in the first half, achieving 100% of the potential that we previously indicated.

Speaker #1: Second, we have £4.5 million of rental reversion attached to half one lease events, which are currently in progress. To remind you, we have a policy of accruing 75% of this from the rent review date.

Speaker #1: And thirdly, the second half events are even more significant, with over £15 million of rental reversion available in H2. Portfolio vacancy was slightly higher overall, but this reflected net development activity.

Frankie Whitehead: Thirdly, the H2 events are even more significant, with over GBP 15 million of rental reversion available in H2. Portfolio vacancy was slightly higher overall, this reflected net development activity. Underlying vacancy remains stable at 3.1%. Logistics development is our second growth driver. We currently have 1.2 million sq ft under construction, representing GBP 13 million of potential additional rent, with 78% of this already secured via pre-leasing. We completed 0.6 million sq ft of new space, with potential rent of GBP 6.9 million at an expected yield on cost of over 10%. This very attractive yield reflects later phases of schemes where land and infrastructure costs have already been borne within previous phases. Further, we secured development lettings in the period, adding almost GBP 5 million of annual rent and achieved an average yield on cost of around 7.5%.

Speaker #1: Underlying vacancy remained stable at 3.1%. Logistics development is our second growth driver. We currently have 1.2 million square feet under construction, representing £13 million of potential additional rent, with 78% of this already secured via pre-leasing.

Speaker #1: We completed 0.6 million square feet of new space, with potential rent of £6.9 million at an expected yield on cost of over 10%.

Speaker #1: This very attractive yield reflects later phases of schemes, where land and infrastructure costs have already been borne within previous phases. Further, we secured development lettings in the period, adding almost £5 million of annual rent, and achieved an average yield on cost of 7.5%.

Speaker #1: And Colin will expand upon some of the positive, forward-looking indicators that we are seeing in a moment. Now, turning to data centers, our third growth driver.

Frankie Whitehead: Colin will expand upon some of the positive forward-looking indicators that we are seeing in a moment. Now turning to data centers, our third growth driver. On the left is a reminder of the key features of our Power First approach. An attractive component is that most of the value is created before construction begins. This illustration shows that approximately 60% of expected development profit is captured through delivering power, planning, and pre-letting. At Manor Farm, we had recognized approximately 20% of scheme profit at 30 June, stepping up to 30% in July after clearing the judicial review period. With a pre-lease expected in H2, we expect to recognize 60% of scheme profits by the financial year end. At Chelmsford, around 10% of scheme profit had been recognized at 30 June. With planning permission pending, we expect to recognize at least 30% by the year end.

Speaker #1: On the left is a reminder of the key features of our power-first approach. An attractive component is that most of the value is created before construction begins.

Speaker #1: This illustration shows that approximately 60% of expected development profit is captured through delivering power, planning, and pre-letting. At Manor Farm, we had recognized approximately 20% of scheme profit at 30 June.

Speaker #1: Stepping up to 30% in July, after clearing the judicial review period. And with a pre-lease expected in H2, we expect to recognize 60% of scheme profits by the financial year-end.

Speaker #1: And at Chelmsford, around 10% of scheme profit had been recognized at 30 June. And with planning permission pending, we expect to recognize at least 30% by the year-end.

Speaker #1: Overall, this could translate to up to £100 million of data center development profit being recognized this current year. Sustainability remains integral to our strategy and supports all three growth drivers.

Frankie Whitehead: Overall, this could translate to up to GBP 100 million of data center development profit being recognized this current year. Sustainability remains integral to our strategy and supports all three growth drivers. We continue to progress across the four pillars of our framework, including increasing rooftop solar, biodiversity, communities, and carbon reduction initiatives. We're also developing a dedicated sustainability approach for our data centers, which we believe will differentiate our projects, and we will talk more about this in future presentations. Our balance sheet remains a competitive advantage, supported by our staggered, diversified, and long-term debt portfolio. We ended the period with an LTV of 32.9%, approximately GBP 530 million of available liquidity, four years average debt maturity, and an average cost of debt of 3.6%. Pulling out the middle chart on this slide, which highlights an important point.

Speaker #1: We continue to make progress across the four pillars of our framework, including increasing rooftop solar, biodiversity, community initiatives, and carbon reduction efforts. We're also developing a dedicated sustainability approach for our data centers.

Speaker #1: Which we believe will differentiate our projects, and we will talk more about this in future presentations. Our balance sheet remains a competitive advantage, supported by our staggered, diversified, and long-term debt portfolio.

Speaker #1: We ended the period with an LTV of 32.9%, approximately £530 million of available liquidity, four years average debt maturity, and an average cost of debt of 3.6%.

Speaker #1: Pulling out the middle chart on this slide, which highlights an important point. Even if interest rates remain elevated and refinancing occurs at prevailing market rates, existing portfolio rental reversion far exceeds projected medium-term financing cost increases.

Frankie Whitehead: Even if interest rates remain elevated and refinancing occurs at prevailing market rates, existing portfolio rental reversion far exceeds projected medium-term financing cost increases. This is before any further rental growth is factored in. Overall, our balance sheet strength provides us with substantial flexibility to fund our future growth opportunities. Looking now at some forward guidance. Given the lower CapEx deployed in this H1, we have updated some of the current year figures in this table to reflect this. We expect to deliver up to GBP 400 million of disposals during the full year 2026 and are well on track given year to date activity. We continue to see annual logistics development CapEx of GBP 200 to 250 million over the long term.

Speaker #1: And this is before any further rental growth is factored in. So, overall, our balance sheet strength provides us with substantial flexibility to fund our future growth opportunities.

Speaker #1: Looking now at some forward guidance. Given the lower capex deployed in this first half, we have updated some of the current-year figures in this table to reflect this.

Speaker #1: We expect to deliver up to £400 million of disposals during the full year 2026 and are well on track given year-to-date activity. We continue to see annual logistics development capex of £200 to £250 million over the long term.

Speaker #1: And given the development of the broader data center opportunity in the period, we are upgrading our capex targets for data centers from next year.

Frankie Whitehead: Given the development of the broader data center opportunity in the period, we are upgrading our CapEx targets for data centers from next year, effectively doubling these to between GBP 200 and 400 million per annum at a targeted yield on cost of 9% to 11%. To conclude, the business continues to combine strategic delivery with financial strength, supported by our robust balance sheet. Together, these support our three growth drivers: asset management and capturing rental reversion, logistics development, and our data center pipeline. It's this combination, augmented by the news of new power connections being secured and new equity capital to support enhanced DC development, which positions us to achieve our upgraded adjusted earnings per share growth ambition of 65% by 2031. Now I'll hand you back to Colin for the strategic update.

Speaker #1: Effectively doubling these to between £200 million and £400 million per annum, at a targeted yield on cost of 9 to 11%. To conclude, the business continues to combine strategic delivery with financial strength, supported by our robust balance sheet.

Speaker #1: Together, these support our three growth drivers: asset management and capturing rental reversion, logistics development, and our data center pipeline. And it's this combination—augmented by the news of new power connections being secured and new equity capital to support enhanced data center development—which positions us to achieve our upgraded adjusted earnings per share growth ambition of 65% by 2031.

Speaker #1: And now I'll hand you back to Colin for the strategic update.

Speaker #2: Thanks, Frankie. Well, I've never before been more confident in our ability to create long-term value for shareholders. We've built a unique platform in the most exciting segments of UK real estate.

Colin Godfrey: Thanks, Frankie. Well, I've never before been more confident in our ability to create long-term value for shareholders. We've built a unique platform in the most exciting segments of UK real estate. A market leading logistics portfolio with significant embedded rental growth, an agile logistics development platform, and a hugely compelling and growing opportunity in data centers. These foundations, established over the last decade, have created a broader opportunity set than ever before, while remaining supported by high-quality income producing assets and a strong balance sheet. As a result, we are extremely well-positioned to continue growing earnings and creating significant value for shareholders over the long term. Starting with a high-level summary on the market. Demand, led by e-commerce occupiers, is healthy at 10.9 million square feet, and supply remains constrained with limited speculative development starts.

Speaker #2: Our market-leading logistics portfolio, with significant embedded rental growth, an agile logistics development platform, and a hugely compelling and growing opportunity in data centers—these foundations established over the last decade have created a broader opportunity set than ever before.

Speaker #2: While remaining supported by high-quality, income-producing assets and a strong balance sheet, we are extremely well-positioned to continue growing earnings and creating significant value for shareholders over the long term.

Speaker #2: Starting with a high-level summary on the market: Demand led by e-commerce occupiers is healthy, at 10.9 million square feet, and supply remains constrained, with limited speculative development starts.

Speaker #2: Vacancy remains stable at around 7%, while rental growth was 2.1%, in line with our portfolio. Investment market activity, suppressed in the spring due to the geopolitical events, shows signs of improvement, with high-quality logistics assets continuing to attract investor interest, albeit that there has been some modest yield softening.

Colin Godfrey: Vacancy remains stable at around 7%, while rental growth was 2.1% in line with our portfolio. Investment market activity, suppressed in the spring due to the geopolitical events, shows sign of improvement with high-quality logistics assets continuing to attract investor interest, albeit that there has been some modest yield softening. Against this backdrop, our portfolio has performed well, reflecting its quality and positioning, and we are optimally placed to capture further growth. We've developed our strategy so that the business can thrive in all market conditions. Our objective remains unchanged: to convert structural demand across logistics and data centers into superior risk-adjusted returns for shareholders. We achieve this through owning and developing high-quality assets and directly and actively managing them. We are client-focused, sustainability-led, and differentiated by our entrepreneurialism. The value that we're delivering is from three distinct and powerful growth drivers.

Speaker #2: Against this backdrop, our portfolio has performed well, reflecting its quality and positioning, and we are optimally placed to capture further growth. We've developed our strategy so that the business can thrive in all market conditions.

Speaker #2: Our objective remains unchanged: to convert structural demand across logistics and data centers into superior risk-adjusted returns for shareholders. We achieve this through owning and developing high-quality assets, and directly and actively managing them.

Speaker #2: We are client-focused, sustainability-led, and differentiated by our entrepreneurialism. The value that we're delivering comes from three distinct and powerful growth drivers. First, capturing rental reversion and creating value through active asset management.

Colin Godfrey: First, capturing rental reversion and creating value through active asset management. Second, delivering logistics developments at attractive yields on cost through an agile and capital-efficient development platform. Third, generating exceptional returns from pre-let data center developments through our innovative Power First approach. Together, these growth drivers provide attractive, high-quality income growth, and substantial long-term value creation opportunities. Our portfolio is a significant competitive advantage. It's a deliberately curated, market-leading collection of modern and mission-critical logistics assets in the UK's most important distribution locations, leased to world-leading occupiers and generating highly resilient income. Supported by a triple net lease structure, it delivers high quality and resilient cash flows, providing a strong platform for embedded and sustainable earnings growth. Turning to our growth drivers. Building on the compounding nature of our rental income, our first growth driver remains one of the most compelling opportunities available to us.

Speaker #2: Second, delivering logistics developments at attractive yields on cost, through an agile and capital-efficient development platform. And third, generating exceptional returns from pre-let data center developments through our innovative, power-first approach.

Speaker #2: Together, these growth drivers provide attractive, high-quality income growth and substantial long-term value creation opportunities. Our portfolio is a significant competitive advantage. It’s a deliberately curated, market-leading collection of modern and mission-critical logistics assets in the UK’s most important distribution locations, leased to world-leading occupiers and generating highly resilient income.

Speaker #2: Supported by a triple net lease structure, it delivers high-quality and resilient cash flows, providing a strong platform for embedded and sustainable earnings growth. Turning then to our growth drivers.

Speaker #2: Building on the compounding nature of our rental income, our first growth driver remains one of the most compelling opportunities available to us. Market rental growth has been replenishing our portfolio rental reversion at the same rate that we have been capturing it.

Colin Godfrey: Market rental growth has been replenishing our portfolio rental reversion at the same rate that we have been capturing it, which is why our attractive level of reversion of over GBP 100 million has remained broadly unchanged. Importantly, this growth requires little or no capital investment. We have a long-established track record of meeting or exceeding market rental values when opportunities arise. During H1, we captured 100% of available ERV. As shown here on the right, we estimate that more than 70% of today's rental reversion can be captured within the next three years. This is highly visible, high quality, and capital-light earnings growth that remains within our control to deliver. Following the successful acquisition of UKCM, the non-strategic asset sales have been above the purchase prices in aggregate, and we now have the final asset in solicitor's hands.

Speaker #2: Which is why our attractive level of reversion of over £100 million has remained broadly unchanged. And importantly, this growth requires little or no capital investment.

Speaker #2: We have a long-established track record of meeting or exceeding market rental values when opportunities arise. And during the first half, we captured 100% of available ERV.

Speaker #2: As shown here on the right, we estimate that more than 70% of today's rental reversion can be captured within the next 3 years. This is highly visible high-quality and capital-light earnings growth that remains within our control to deliver.

Speaker #2: Following the successful acquisition of UKCM, the non-strategic asset sales have been above the purchase prices in aggregate, and we now have the final asset in solicitors' hands.

Speaker #2: Enhancing our urban small-box opportunity at the Blackstone acquisition has significantly increased our rental reversion and is performing strongly, with contracted rent up 4.4%, and more to come.

Colin Godfrey: Enhancing our urban small box opportunity, the Blackstone acquisition significantly increased our rental reversion and is performing strongly with contracted rent up 4.4% and more to come. Our direct approach to asset management is producing compelling results, having completed 14 new lettings, adding around GBP 2 million of income, and delivered average uplifts of 42% at rent review, representing a new asset event every two days since acquisition. The examples on the right highlight the opportunity to deliver compelling rental income growth. Contracted rent has increased by 56% at Gatwick Distribution Point and 33% at Stirchley Trading Estate since acquisition. Taken together, this demonstrates that the Blackstone portfolio is performing in line with and in some areas ahead of our original expectations. Our second growth driver is logistics development.

Speaker #2: A direct approach to asset management is producing compelling results, having completed 14 new lettings, adding around £2 million of income, and delivered average uplifts of 42% at rent review.

Speaker #2: Representing the new asset event every two days since acquisition. The examples on the right highlight the opportunity to deliver compelling rental income growth. Contracted rent has increased by 56% at the Gatwick distribution point.

Speaker #2: And 33% at Sturchley Trading Estate since acquisition. Taken together, this demonstrates that the Blackstone portfolio is performing in line with, and in some areas ahead of, our original expectations.

Speaker #2: Our second growth driver is logistics development. With more than £360 million of future rental income potential, this remains one of the largest and most attractive development portfolios in the UK market.

Colin Godfrey: With more than GBP 360 million of future rental income potential, this remains one of the largest and most attractive development portfolios in the UK market. Through our agile and capital-efficient approach, we target yields on cost of 6% to 8%, with recent activity towards the top end of that range. Development activity in H1 was lower than prior periods, reflecting planning timetables on a small number of schemes rather than any change in occupier demand. As we've shown on the right, we have pre-lets in solicitor's hands, advanced discussions across several opportunities, and strong occupier inquiry levels. Combined with our capital efficient and land option model, this leaves us well-positioned to accelerate delivery as schemes move through the pipeline and operational demand crystallizes. Data centers represent a significant additional growth opportunity and are already contributing to performance.

Speaker #2: Through our agile and capital-efficient approach, we target yields on cost of 6% to 8%, with recent activity towards the top end of that range.

Speaker #2: Development activity in the first half was lower than in prior periods, reflecting planning timetables on a small number of schemes rather than any change in occupier demand.

Speaker #2: As we've shown on the right, we have pre-lets in solicitors' hands, advanced discussions across several opportunities, and strong occupier inquiry levels. Combined with our capital-efficient and land option model, this leaves us well positioned to accelerate delivery as schemes move through the pipeline and operational demand crystallizes.

Speaker #2: Data centers represent a significant additional growth opportunity and are already contributing to performance. Market demand continues to accelerate, driven by hyperscale cloud AI and data sovereignty requirements.

Colin Godfrey: Market demand continues to accelerate, driven by hyperscale cloud, AI, and data sovereignty requirements, while power constraints continue to limit new supply. As a result, occupiers are expanding beyond traditional West London locations into new markets where power is available. These conditions play directly to the strengths of our lower-risk Power First strategy, creating opportunities to deliver projects of scale for leading operators. This third growth driver is a particularly exciting part of our strategy because we're at the early stages of the journey and there is so much more to come. Manor Farm demonstrates why our power-first approach to data centers is so valuable in a power-constrained market. With power and planning consent secured, we now own an exceptionally scarce asset of scale in one of the world's most important data center locations. This has attracted significant occupier interest with a pre-let imminent.

Speaker #2: While power constraints continue to limit new supply, occupiers are expanding beyond traditional West London locations into new markets where power is available.

Speaker #2: These conditions play directly to the strengths of our lower-risk, power-first strategy, creating opportunities to deliver projects of scale for leading operators. This third growth driver is a particularly exciting part of our strategy because we're at the early stages of the journey, and there is so much more to come.

Speaker #2: Manor Farm demonstrates why our power-first approach to data centers is so valuable in a power-constrained market. With power and planning consent secured, we now own an exceptionally scarce asset of scale in one of the world's most important data center locations.

Speaker #2: This has attracted significant occupier interest, with a pre-let imminent. And as Frankie highlighted earlier, all of this supports a meaningful uplift in NTA, with development profits preceding attractive rental income at a 9.3% yield on cost, creating exceptional risk-adjusted returns.

Colin Godfrey: As Frankie highlighted earlier, all of this supports a meaningful uplift in NTA, with development profits preceding attractive rental income at a 9.3% yield on cost, creating exceptional risk-adjusted returns. This is our power-first approach in action. The really exciting news is that Manor Farm is just the start, as we are today announcing two further schemes which nearly double the amount of our secured power. As we outline on the left-hand side of this slide, our first two schemes have the potential to deliver approximately GBP 58 million of annual rent at an attractive 9% to 11% yield on cost, with planning secured at Manor Farm, and Chelmsford not far behind. They are already contributing to NTA growth, with capital value gains in the period.

Speaker #2: This is our power-first approach in action. And the really exciting news is that Manor Farm is just the start, as we are today announcing two further schemes which nearly double the amount of our secured power.

Speaker #2: As we outline on the left-hand side of this slide, our first two schemes have the potential to deliver approximately £58 million of annual rent at an attractive 9% to 11% yield on cost.

Speaker #2: With planning secured at Manor Farm, and Chelmsford not far behind, they are already contributing to NTA growth, with capital value gains in the period.

Speaker #2: And, as mentioned, we have secured an additional 235 megawatts of power, enabling an additional two schemes in the London availability zone, as shown in the middle of the slide.

Colin Godfrey: As mentioned, we have secured an additional 235 megawatts of power, enabling an additional two schemes in the London availability zone, as shown in the middle of the slide. This near doubling of our secured power also gives us the capability to nearly double the potential data center rental income that we can generate of between GBP 107 and 119 million per annum at compelling yields on cost, supporting an increase in our EPS ambition. These secured schemes form part of a total current opportunity of over 1 gigawatt, offering the potential to deliver exceptional income and capital returns over the medium term. Bringing everything together, you will be familiar with this bridge, which illustrates the scale of the opportunity ahead, giving us the potential to nearly double our rent roll in the medium term.

Speaker #2: This near doubling of our secured power also gives us the capability to nearly double the potential data center rental income that we can generate, to between £107 million and £119 million per annum.

Speaker #2: At compelling yields on cost, supporting an increase in our EPS ambition. These secured schemes form part of a total current opportunity of over 1 gigawatt.

Speaker #2: Offering the potential to deliver exceptional income and capital returns over the medium term. Bringing everything together, you'll be familiar with this bridge, which illustrates the scale of the opportunity ahead, giving us the potential to nearly double our rent roll in the medium term.

Speaker #2: So, starting with today's passing rent on the left, we show how our three growth drivers can deliver materially higher earnings over time. Rental reversion provides the largest near-term opportunity, driven by lease events and active asset management.

Colin Godfrey: Starting with today's passing rent on the left, we show how our three growth drivers can deliver materially higher earnings over time. Rental reversion provides the largest near-term opportunity, driven by lease events and active asset management. Logistics development adds a substantial layer of potential future income and capital value growth through pre-lets, completions, and the continued replenishment of the pipeline. Data centers provide a significant additional source of both income growth and value creation, beginning with Manor Farm and Chelmsford and the contribution of the new schemes of GBP 55 million, effectively providing approximately GBP 113 million of rental income. While this bridge shows the rental income potential within the business, we also expect to deliver significant NTA growth, which will support total accounting returns. This is particularly relevant to our data center pipeline, where meaningful development gains will drive NTA growth ahead of significant rental income contributions.

Speaker #2: Logistics development adds a substantial layer of potential future income and capital value growth through pre-lets, completions, and the continued replenishment of the pipeline. Data centers provide a significant additional source of both income growth and value creation.

Speaker #2: Beginning with Manor Farm and Chelmsford, the contribution of the new schemes of £55 million is effectively providing approximately £113 million of rental income.

Speaker #2: And while this bridge shows the rental income potential within the business, we also expect to deliver significant NTA growth, which will support total accounting returns.

Speaker #2: This is particularly relevant to our data centre pipeline, where meaningful development gains will drive NTA growth ahead of significant rental income contributions. So, in conclusion, we have never been more confident in the opportunity ahead.

Colin Godfrey: In conclusion, we have never been more confident in the opportunity ahead. Our high-quality portfolio with substantial embedded rental growth, agile development platform, and exceptional data center opportunities provide multiple pathways to grow income significantly and create substantial value. Supported by a strong balance sheet and disciplined capital allocation, we believe that we are very well-positioned to deliver our enhanced earnings growth ambition. Thank you for joining us. That concludes the formal part of our presentation. I will now hand over to Ian for your questions. Ian?

Speaker #2: Our high-quality portfolio with substantial embedded rental growth, agile development platform, and exceptional data center opportunities provide multiple pathways to grow income significantly and create substantial value.

Speaker #2: Supported by a strong balance sheet and disciplined capital allocation, we believe that we are very well positioned to deliver our enhanced earnings growth ambition.

Speaker #2: Thank you for joining us. That concludes the formal part of our presentation. I'll now hand over to Ian for your questions. Ian.

Speaker #1: Good morning everyone, and welcome to the live Q&A part of the presentation this morning. We'll begin by taking calls from the phone lines, and then we'll move over to the webcast to take your questions from there.

Ian Brown: Good morning, everyone, and welcome to the live Q&A part of the presentation this morning. We will begin by taking calls from the phone lines, and then we will move over to the webcast to take your questions from there. Just as a reminder, on the webcast, there is a chat box you can put your question into, and we will try and get through as many as we can. Where possible, we will try and aggregate similar questions thematically. With that, I will hand over to Laura, who I think is helping us on the phones, and take our first question from there.

Speaker #1: Just as a reminder, on the webcast there is a chat box you can put your question into, and we'll try and get through as many as we can.

Speaker #1: And where possible, we will try and aggregate similar questions thematically. So with that, I'll hand over to Laura, who I think is helping us on the phones, and take our first question from there.

Speaker #3: Thank you, Ian. Ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We will now take our first question from John Wong of Kempen. Your line is open; please go ahead.

Operator: Thank you, Ian. Ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We will now take our first question from John Wong of Kempen. Your line is open. Please go ahead.

Operator: Thank you, Ian. Ladies and gentlemen, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We will now take our first question from John Vuong of Kempen. Your line is open. Please go ahead.

Speaker #4: Hi, good morning. Thank you for taking my question. So, you haven’t started any developments in logistics in the first half, which I understand is partly driven by planning.

John Wong: Hi. Good morning. Thank you for taking my question. You haven't started any developments in logistics in H1, which I understood is partly driven by planning. At the same time, you have delivered some vacant developments. Just tying this together with your data center ambitions and the 2030 to 2031 EPS growth targets, how should we see the split of growth between the two sectors going forward?

John Vuong: Hi. Good morning. Thank you for taking my question. You haven't started any developments in logistics in H1, which I understood is partly driven by planning. At the same time, you have delivered some vacant developments. Just tying this together with your data center ambitions and the 2030 to 2031 EPS growth targets, how should we see the split of growth between the two sectors going forward?

Speaker #4: At the same time, you have delivered some vacant developments. So just tying this together with your data center ambitions and the 2030 to 31 EPS growth target, how should we see the split of growth between the 2 sectors going forward?

Ian Brown: That's Frankie. Sir John Lucy.

Ian Brown: That's Frankie. Sir John Vuong.

Speaker #1: Thank you for joining me.

Speaker #2: Yeah, hi John, thanks for your question. So on development look, I think we're going to be second half waited in terms of our delivery from development this financial year.

Frankie Whitehead: Yeah. Hi, John. Thanks for your question. On development look, I think we're going to be H2 weighted in terms of our delivery from development this financial year. We expect the CapEx to increase as we move through H2. We've got a number of deals in solicitor's hands and lots of active discussions going on, expect a pick-up there through H2. I think as we look at the sort of five to six-year journey, certainly the front half of that from an income delivery perspective is going to be logistics development led. We expect our first data center to come on stream from 2028 onwards. 2028 onwards, there'll be the DC income, which will give that EPS real acceleration as we move into the 2030, 2031 period. H1 logistics driven, H2 data center driven across that timeframe.

Speaker #2: We expect the capex to increase as we move through the second half. We've got a number of deals in solicitors' hands, and lots of active discussions going on.

Speaker #2: So expect a pickup there through half two. I think as we look at the sort of five- to six-year journey, certainly the front half of that, from an income delivery perspective, is going to be development-led, logistics development-led.

Speaker #2: We expect our first data center to come on stream from 2028 onwards. So from 2028 onwards, there will be the data center income, which will contribute to that EPS.

Speaker #2: Real acceleration as we move into the 2030–2031 period. So, first half logistics-driven, second half data center-driven across that timeframe.

Speaker #4: Okay, that's clear. Thank you. And just on Chelmsford, I noticed that there's again some fees payable to the manager as well as a profit share similar to Manor Farm.

John Wong: Okay. That's clear. Thank you. Just on Chelmsford, I noticed that there's again some fees payable to the manager as well as a profit share similar to Manor Farm. Just to confirm, is the targeted yield on cost of 10% to 11% net of all these fees? Following up on that, should we also expect a similar fee structure for the two new schemes?

John Vuong: Okay. That's clear. Thank you. Just on Chelmsford, I noticed that there's again some fees payable to the manager as well as a profit share similar to Manor Farm. Just to confirm, is the targeted yield on cost of 10% to 11% net of all these fees? Following up on that, should we also expect a similar fee structure for the two new schemes?

Speaker #4: Just to confirm, is the targeted yield on cost of 10 to 11% net of all these fees? And following up on that, should we also expect a similar fee structure for the 2 new

Speaker #2: Yes, it is net. And the Board has yet to agree the fee structure for the two new schemes, but that will be confirmed at the time.

Frankie Whitehead: Yes, it is net. The board has yet to agree the fee structure for the two new schemes, that will be confirmed at the time.

Speaker #4: Okay, that's clear. And just on the yield on cost target for the two new schemes, what's the swing factor between the lower and the higher end of the range?

John Wong: Okay. That's clear. Just on the yield on cost target for the two new schemes, what's the swing factor between the lower and the high end of the range? Is that driven by these fees or is there another factor, for example, the type of tenant that you would be looking at?

John Vuong: Okay. That's clear. Just on the yield on cost target for the two new schemes, what's the swing factor between the lower and the high end of the range? Is that driven by these fees or is there another factor, for example, the type of tenant that you would be looking at?

Speaker #4: Is that driven by these fees, or is there another factor? For example, the type of tenant that you would be looking at?

Speaker #2: No, it’s just to give room for manoeuvre. I mean, obviously there are many varying factors that can impact the yield on cost, and it partly depends on location and the type of building that we’re creating.

Frankie Whitehead: No, it's just to give room for maneuver. I mean, obviously there are many varying factors that can impact on the yield on cost. It partly depends on location and the type of building that we're creating. Manor Farm, by way of example, is 9.3% target yield on cost. That's quite precise. Most of the other schemes that we are looking to deliver are in double digits. In uber prime locations, you can expect that to be slightly under double digits. In prime locations such as Chelmsford, you could expect it to be into double digits. It just gives us a range to explain the type of difference in the locations that we're targeting.

Speaker #2: So Manor Farm by way of example is 9.3% target yield on cost. That's quite precise. Most of the other schemes that we are looking to deliver are in double digits.

Speaker #2: But in Uber prime locations, you can expect that to be slightly under a double digits and in prime locations such as Chelmsford, you could expect it to be into double digits.

Speaker #2: So it just gives us a range to explain the type of difference in the locations that we're targeting.

Speaker #4: Okay, that's clear. Thank you.

John Wong: Okay. That's clear. Thank you.

John Vuong: Okay. That's clear. Thank you.

Speaker #3: Thank you. We'll now move on to our next question from Paul May of Barclays, your line is open, please go ahead.

Operator: Thank you. We'll now move on to our next question from Paul May of Barclays. Your line is open. Please go ahead.

Speaker #5: Hi, guys. Just three new, should-be-quick questions from me. Could we see part of the equity raise today as effectively a bit of a backfill on the Blackstone portfolio acquisition, just to provide some equity for that?

Paul May: Hi, guys. Just three should be quick questions from me. Could we see part of the equity raise today as effectively a bit of a backfill on the Blackstone portfolio acquisition just to provide some equity for that, given leverage increased through that deal and income accretion doesn't come for quite some time from the data centers? Secondly, just following on from John's question really, given the obviously difficult warehouse development situation, is it not more accretive, especially on a risk-adjusted basis, to look at large acquisition opportunities similar to that Blackstone deal? We understand there are opportunities available and more coming as private funds refinance at higher rates. The final one, what justification do the valuers have or provide to you for the 4.38% net initial yield? There doesn't seem to be any transactional evidence for this.

Speaker #5: Given leverage increased through that deal and the income accretion, doesn't come for quite some time, from the data centers. And secondly, given and just following on from John's question really, given the obviously difficult warehouse development situation, is it not more accretive, especially on a risk adjusted basis, to look at the large acquisition opportunities similar to that Blackstone deal?

Speaker #5: We understand there are opportunities available, and more coming, as private funds refinance at higher rates. And then the final one: what justification do the valuers have, or provide to you, for the 4.38% net social yield?

Speaker #5: There doesn’t seem to be any transactional evidence for this, so I just wondered what their basis is and what your comfort is on that valuation.

Paul May: I just wondered what their basis is and what your comfort is on that valuation. Thank you.

Speaker #5: Thank you.

Speaker #1: So you mentioned repeating that last part of your third question, just we didn't quite catch the number there.

Ian Brown: Sorry. Do you mind just repeating that last part of your third question, just we didn't quite catch the number there.

Paul May: The 4.38% net initial yield, it doesn't seem to be supported by transactional evidence, I just wonder what gives you and your valuers comfort at that level of yield, the valuation?

Speaker #5: The 4.38% net social yield, it doesn't seem to be supported by transactional evidence. And I just wonder what gives you new and your valuers comfort at that level of yield, the valuation.

Speaker #2: Well, look, to start off, Paul, thanks for your questions. It's Colin. The first thing to say is that, no, we're not backfilling. We're really happy with where the LTV currently sits.

Colin Godfrey: Well, look, to start off, Paul, thanks for your questions. It's Colin. The first thing to say is that, no, we're not backfilling. We're really happy with where the LTV currently sits. It's in line with business plan. We've successfully executed GBP 344 million of sales year to date and over GBP 1 billion of sales over the last three and a half years, all in aggregate above our average valuation levels. I think that partly talks to one of your other questions about lack of evidence. I mean, we've proved our NAV time and again, in selling everything across our portfolio, long income, short income, older buildings, shorter buildings, high quality covenant income, et cetera. That's the first answer. Second one regarding our warehouse development. I mean, look, markets ebb and flow a little bit.

Speaker #2: It's in line with our business plan. We've successfully executed £344 million of sales year to date, and over £1 billion of sales over the last three and a half years—all, in aggregate, above our average valuation levels.

Speaker #2: So I think that partly addresses one of your other questions about lack of evidence. I mean, we've proved our NAV time and again in selling everything across our portfolio—long income, short income, older buildings, shorter buildings, high-quality covenant income, etc.

Speaker #2: So that's the first answer. The second one, regarding our warehouse development—I mean, look, markets ebb and flow a little bit. These are big buildings.

Frankie Whitehead: These are big buildings, we're pretty confident in the pickup in the H2 and the significant level of activity we've got ongoing should be seen in that period and into 2027. Acquisitions naturally will fulfill part of our thinking. You've seen us very active in that space in the acquisition of UKCM and of course the Blackstone portfolio. It's part of a

Colin Godfrey: These are big buildings, we're pretty confident in the pickup in the H2 and the significant level of activity we've got ongoing should be seen in that period and into 2027. Acquisitions naturally will fulfill part of our thinking. You've seen us very active in that space in the acquisition of UKCM and of course the Blackstone portfolio. It's part of a

Speaker #2: And we're pretty confident in the pickup in the second half, and the significant level of activity we've got ongoing should be seen in that period and into 2027.

Speaker #2: Acquisitions, naturally, will fulfill part of our thinking. And you've seen us very active in that space with the acquisition of UKCM and, of course, the Blackstone portfolio.

Speaker #2: But it's part of a broad set of opportunities that we will continue to consider with the board in ensuring that we're making the best possible decisions for shareholders right the way across the business in terms of opportunity set, whether that's organic or through acquisitions.

Colin Godfrey: A broad set of opportunities that we will continue to consider with the board in ensuring that we're making the best possible decisions for shareholders right the way across the business in terms of opportunity set, whether that's organic or through acquisitions.

Paul May: Just coming back on the disposable dimensions and improving valuations. I appreciate they improve the valuation of those sales, I've only just wondered on that 4.38%, that is very tight. There doesn't seem to be much activity at that kind of level. Certainly when I speak to people in the market, they slightly scoff at that kind of number. Just wonder what gives you the confidence on your remaining portfolio for that number?

Speaker #5: Just coming back on the disclosure you mentioned and proving valuations, I appreciate they proved the valuation of those sales. But I just wondered, on that 4.38%—yeah, that is very tight.

Speaker #5: There doesn't seem to be much activity at that kind of level. It's only when I speak to people in the market that they kind of slightly scoff at that kind of number.

Speaker #5: Just wonder what gives you the confidence on your remaining portfolio?

Speaker #1: Yeah, Paul, I think

Colin Godfrey: Yeah, Paul, I think the net initial yield is not really the metric. It's the numeric underpin to the equivalent yield, and the reversionary yield and the timing of delivery of the reversionary yield that's driving market interest. It is fair to say that liquidity has slowed a little bit, and we have seen two agencies move out their prime yield by a quarter of a point. You've seen that play out in our NTA. We're keeping a close eye on that, but we think that across the market, we're in a pretty good shape in terms of the quality of our real estate, and the liquidity of our properties, which we've proved time and again. Obviously that's a consequence of geopolitical risk and macroeconomic backdrop that's impacting on confidence in the marketplace.

Speaker #2: The net initial yield is not really the metric. It's the numeric underpinning to the equivalent yield. It's the reversionary yield and the timing of delivery of the reversionary yield that's driving market interest.

Speaker #2: I mean, it is fair to say that liquidity has slowed a little bit, and we have seen two agencies move out their prime yield by a quarter of a point, and you've seen that play out in our NTA.

Speaker #2: So we're keeping a close eye on that, but we think that across the market, we're in pretty good shape in terms of the quality of our real estate and the liquidity of our properties, which we've proved time and again.

Speaker #2: So but obviously that's a consequence of geopolitical risk and macroeconomic backdrop that's impacting on confidence in the marketplace. But we do still see significant amount of investment looking to get into logistics assets.

Colin Godfrey: We do still see a significant amount of investment looking to get into logistics assets.

Paul May: It's probably fair to say that as you capture the reversion, in theory, your value doesn't increase materially, but your earnings obviously move in the right direction. Is that the right way to think about it? Your net initial yield will expand as you capture the reversion potential.

Speaker #5: It's pretty fair to say that as you capture the reversion, in theory your value doesn't increase materially, but your earnings obviously move in the right direction.

Speaker #5: Is that the right way to think about it? Your net social yield will expand as you capture the reversion potential.

Speaker #2: Well, that's correct to one degree. But, of course, as we've been capturing the reversion, market rental growth has been very healthy, and the reversions continue to be replenished.

Colin Godfrey: Well, that's correct to 1 degree. As we've been capturing the reversion, market rental growth has been very healthy, and the reversions continue to be replenished. It's been replenished at the same rate as we've been capturing it, which is why we still have a 29%, in fact, slightly ahead at a new record level of reversion of 29.2%. There's still a lot more to come there, Paul. Of course, the process of capturing that is helping us move up the yield curve progressively over the course of the next few years.

Speaker #2: So it's been replenished at the same rate as we've been capturing it, which is why we still have a 29%. In fact, a slightly ahead at a new record level of reversion to 29.2%.

Speaker #2: So there's still a lot more to come there, Paul. And of course, the process of capturing that is helping us move up the yield curve progressively over the course of the next few years.

Speaker #3: Paul, could I just add that I think from a valuer's perspective, the top-to-top net initial—the 4.7% that we quote—is more akin to that, not the 4.4%.

Frankie Whitehead: Paul, could I just add that, I think from a valuer's perspective, the top net initial, the 4.7 that we quote is more akin to that, not the 4.4, and the equivalent is 5.8. I view net initial 4.7, equivalent 5.8 at 30 June.

Speaker #3: And the equivalent is 5.8. So, I'd view net initial 4.7, equivalent 5.8, at 30 June.

Speaker #1: Yeah, the 5.8 is far more important

Colin Godfrey: Yeah, the 5.8 is far more important metric to the market.

Speaker #2: metric to the market.

Speaker #5: Yeah, perfect. Thanks, guys.

Paul May: Perfect. Thanks, guys.

Speaker #4: Thank you. We'll now take our next question from Kristen Hjort of Deutsche Bank. Your line is open. Please go ahead.

Operator: Thank you. We'll now take our next question from Christian Hjort of Deutsche Bank. Your line is open. Please go ahead.

Operator: Thank you. We'll now take our next question from Christen Hjorth of Deutsche Bank. Your line is open. Please go ahead.

Speaker #6: Thank you very much, and thanks for taking the questions. Just 2 from me. So first of all, when you sort of think about risks of delays on DCs 3 and 4, which unfortunately in the UK is something we will have to consider, to what extent is that being factored into the timelines that you've set out?

Christian Hjort: Thank you very much, thanks for taking the questions. Just two from me. First of all, when you think about risks of delays on DCs 3 and 4, which unfortunately in the UK is something we will have to consider, to what extent is that being factored into the timelines that you've set out? Second, obviously a good performance on the cost ratio in H1. How should we think about that going forward? Should we have a degree of operational gearing, particularly around the data center piece as the rental income starts coming through from that at the back end of the decade? Thank you.

Christen Hjorth: Thank you very much, thanks for taking the questions. Just two from me. First of all, when you think about risks of delays on DCs 3 and 4, which unfortunately in the UK is something we will have to consider, to what extent is that being factored into the timelines that you've set out? Second, obviously a good performance on the cost ratio in H1. How should we think about that going forward? Should we have a degree of operational gearing, particularly around the data center piece as the rental income starts coming through from that at the back end of the decade? Thank you.

Speaker #6: And second, obviously there's been a good performance on the cost ratio in H1. How should we think about that going forward? Should we expect a degree of operational gearing, particularly around the data center piece, as the rental income starts coming through from that at the back end of the decade?

Speaker #6: Thank you.

Speaker #2: Yeah, thanks for the question. So, on the DCs, I think our experience at Manor Farm was an extreme case, where we had to go to appeal after delays in local authority non-determination.

Colin Godfrey: Thanks for the question. On the DCs, I think our experience at Manor Farm was an extreme case, where we had to go to appeal after delays in local authority non-determination. It was then subject to a consideration by the inspector and then was called in by the government. We don't expect any of our subsequent schemes to take nearly that long. Chelmsford's being dealt with by way of, it's an allocated site, and it's being dealt with by way of dedicated powers to the local authority, so it doesn't even go to committee. As for the two new schemes, we see those sitting within the bookends of those two extreme cases that I've just outlined. Yes, we have factored in what we believe is appropriate timelines given that experience into the timetable that we've outlined.

Speaker #2: It was then subject to consideration by the inspector, and then was called in by the government. We don't expect any of our subsequent schemes to take nearly that long.

Speaker #2: Chelmsford's being dealt with by way of—it's an allocated site, and it's being dealt with by way of delegated powers to the local authority.

Speaker #2: So it doesn't even go to committee. And as for the 2 new schemes, we see those sitting within the bookends of those 2 extreme cases that I've just outlined.

Speaker #2: So yes, we have factored in what we believe is appropriate timelines given that experience into the timetable that we've outlined and the Frankie's just mentioned with income delivery from Manor Farm first full year 28 and then the last scheme expecting to be fully income producing in 2031.

Colin Godfrey: Frankie's just mentioned, with income delivery from Manor Farm first full year 2028, and the last scheme expecting to be fully income producing in 2031. Frankie, would you like to take the cost ratio?

Speaker #2: Frankie, would you like to take the cost ratio?

Frankie Whitehead: On the cost ratio, obviously it's something we keep a keen eye on. We have been driving that down in recent periods. I think as we look forwards over the timeframe that we're talking here with DC delivery, there's plenty of scope to drive that a lot closer to the 10% mark from a net cost ratio perspective.

Speaker #3: On the cost ratio, obviously it's something we keep a keen eye on. We have been driving that down in recent periods. I think as we look forward over the timeframe that we're talking about here with DC delivery, there's plenty of scope to drive that a lot closer to the 10% mark from a net per cost ratio perspective.

Speaker #6: Brilliant. Thank you very much.

Christian Hjort: Brilliant. Thank you very much.

Christen Hjorth: Brilliant. Thank you very much.

Speaker #4: Thank you. And we'll now take our next question from Endre Saunders of Shore Capital. Your line is open. Please go ahead.

Operator: Thank you. We'll now take our next question from Andrew Saunders of Shore Capital. Your line is open. Please go ahead.

Speaker #5: Thank you. Morning, everybody. I'm congrats on a very good set of interims, and the equity raise. I've got 2 questions, if I may. First one, just how the equity raise might change your thinking on planned disposals and further debt drawdown.

Andrew Saunders [Equity Research Analyst: Thank you. Morning, everybody, and congrats on Very good set of interims and the equity raise. I've got two questions, if I may. First one, just how the equity raise might change your thinking on planned disposals and further debt drawdown going forward, perhaps where we might see leverage settling out over the next five years or so. Secondly, if we can just talk about the reversion opportunity. Perhaps you can just flesh out for us how much of that actually sits with the urban logistics portfolio, and I think you sort of touched on that with the Blackstone deal. Perhaps just give us a flavor of where the sort of greater upside sits between big box and urban reversion. Thank you.

Andrew Saunders: Thank you. Morning, everybody, and congrats on Very good set of interims and the equity raise. I've got two questions, if I may. First one, just how the equity raise might change your thinking on planned disposals and further debt drawdown going forward, perhaps where we might see leverage settling out over the next five years or so. Secondly, if we can just talk about the reversion opportunity. Perhaps you can just flesh out for us how much of that actually sits with the urban logistics portfolio, and I think you sort of touched on that with the Blackstone deal. Perhaps just give us a flavor of where the sort of greater upside sits between big box and urban reversion. Thank you.

Speaker #5: Going forward, perhaps where we might see leverage settling out over the next 5 years or so. And secondly, if we can just talk about the reversion opportunity.

Speaker #5: Perhaps you can just flesh out for us how much of that actually sits with the Urban Logistics portfolio, and I think you sort of touched on that with the Blackstone deal.

Speaker #5: Perhaps just give us a flavor of where the sort of greater upside sits between big box and urban reversion. Thank you.

Colin Godfrey: Yeah, if you like.

Speaker #2: Yeah, if you like.

Frankie Whitehead: Hi. I see on the disposal front, look, we've been effective sellers and rotators of capital over the last sort of 2 to 3 years as we've highlighted. That isn't going to stop. We think a continual pruning of lower performing assets, maybe assets that are sitting there with a little bit more risk in them is good discipline. We'll continue to do that. The guidance we stated, looking forward to disposals of anything up to GBP 350 million per annum. That capital rotation piece will continue. From a debt perspective, clearly the equity reduces our leverage to between 27% and 28%. We think, going into this next phase where we've upgraded our DC CapEx targets, well capitalized is in the best interest of shareholders. We've always operated with a policy of a sub 35% loan to value. That isn't going to change.

Speaker #3: Hi. I see on the disposal front, look, we've been effective sellers and rotators of capital over the last sort of two to three years, as we've highlighted.

Speaker #3: That isn't going to stop. We think a continual pruning of lower-performing assets, maybe assets that are sitting there with a little bit more risk in them, is good discipline.

Speaker #3: So, we'll continue to do that. The guidance we've stated, looking forward, is disposals of anything up to £350 million per annum. So that capital rotation piece will continue.

Speaker #3: From a debt perspective, clearly the equity reduces our leverage to between 27% and 28%. We think going into this next phase, where we've upgraded our DC capex targets, being well-capitalized is in the best interests of shareholders.

Speaker #3: We've always operated with a policy of a sub-35% loan-to-value. That isn't going to change. I think for the next period of time, seeing us in and around that 30% mark—if not slightly below that 30% mark—is where we'll operate for the foreseeable future.

Frankie Whitehead: I think for the next period of time, seeing us in and around that 30% mark, if not slightly below that 30% mark, is where we'll operate for the foreseeable future.

Speaker #2: Thanks. Thanks, Andrew. So, talking to the reversion opportunity, I mentioned the 29% overall. I mean, we've been making great strides in urban logistics capture.

Colin Godfrey: Thanks, Andrew. Talking to the reversion opportunity, I talked to the 29% overall. We've been making great strides in urban logistics capture. I think we talked to the asset management side of the business, which has been incredibly powerful in delivering essentially an initiative every other day. The reversion appertaining to the smallbox urban piece of our portfolio stands for around 40% of the total reversionary pot. Relative to the size of our portfolio, that is where the larger element of the opportunity lies. Of course, we do have some vacancy in the small box portfolio as well, which provides a further opportunity to tighten that, and therefore to deliver to the net increase in income capture.

Speaker #2: And I think we talked to the asset management side of the business, which has been incredibly powerful in delivering essentially an initiative every other day.

Speaker #2: The reversion appertaining to the small box urban piece of our portfolio stands to around 40% of the total reversionary pot. So relative to the size of our portfolio, that is where the larger element of the opportunity lies.

Speaker #2: Of course, we do have some vacancy in the portfolio in the small box portfolio as well. Which provides a further opportunity to tighten that.

Speaker #2: And to therefore deliver a net increase in income capture.

Speaker #5: Okay, thanks very much. That's very clear. Thank you.

Andrew Saunders [Equity Research Analyst: Okay, thanks very much. That's very clear. Thank you.

Andrew Saunders: Okay, thanks very much. That's very clear. Thank you.

Speaker #4: Thank you. And we'll now move on to our next question from Suraj Goyal of Green Street. Your line is open. Please go ahead.

Operator: Thank you. We'll now move on to our next question from Saroj Goyal of Green Street. Your line is open. Please go ahead.

Operator: Thank you. We'll now move on to our next question from Suraj Goyal of Green Street. Your line is open. Please go ahead.

Speaker #7: Good morning, all. Thanks for taking my question. Just a couple from me. So could you share some additional color on how the integration of the Blackstone portfolio is going?

Saroj Goyal: Morning, all. Thanks for taking my question. Just a couple from me. Could you share some additional color on how the integration of the Blackstone portfolio is going? I know you provided a couple of the positive case studies in the presentation. Thinking now almost a year on, are there parts of the portfolio that you now see as more challenging? Maybe not necessarily the case a year ago. On April vacancy, which jumped to 6.5% from 5.6% at year-end. I think I saw in the release it was entirely from unlet spec completions. What's the sort of lending timeline on that space, in your opinion? Is there a scenario where your continued spec development potentially starts to outpace occupied demand? In addition to that, how are sort of tenant incentives trending? Are you seeing any upward pressure here? Thank you.

Suraj Goyal: Morning, all. Thanks for taking my question. Just a couple from me. Could you share some additional color on how the integration of the Blackstone portfolio is going? I know you provided a couple of the positive case studies in the presentation. Thinking now almost a year on, are there parts of the portfolio that you now see as more challenging? Maybe not necessarily the case a year ago. On April vacancy, which jumped to 6.5% from 5.6% at year-end. I think I saw in the release it was entirely from unlet spec completions. What's the sort of lending timeline on that space, in your opinion? Is there a scenario where your continued spec development potentially starts to outpace occupied demand? In addition to that, how are sort of tenant incentives trending? Are you seeing any upward pressure here? Thank you.

Speaker #7: I know you provided a couple of the positive case studies in the presentation. But thinking now, almost a year on, are there parts of the portfolio that you now see as more challenging?

Speaker #7: Maybe that wasn't necessarily the case a year ago. And then, on EPRA vacancy, which jumped to 6.5% from 5.6% at year-end, I think I saw in the release that it was entirely from unlet spec completions.

Speaker #7: What's the sort of letting timeline on that space, in your opinion? And is there a scenario where your continued spec development potentially starts to outpace occupied demand?

Speaker #7: And then in addition to that, how are sort of tenant incentives trending? Are you seeing any upward pressure here? Thank you.

Colin Godfrey: Thanks very much for the questions. The integration of the Blackstone portfolio has gone incredibly well. We're delighted with how it's dovetailed in with the core UK CM assets we've acquired to produce a really high quality small box urban portfolio. As I alluded to earlier, we've been making great strides in leasing some of the vacancy there. There's been a huge amount of active management being undertaken in-house. As I said, one transaction every other day, very strong income capture from those activities. We've been really pleased. Look, these are in the main parks, and we're controlling the parks and driving value through doing things such as refurbishments, proving new rental tones, then applying that to the parks. It's also about making sure that our customers are happy. We are a customer-led business.

Speaker #2: Thanks very much for the questions. So, the integration of the Blackstone portfolio has gone incredibly well. We're delighted with how it's dovetailed in with the core UKCM assets we've acquired to produce a really high-quality, small-box urban portfolio.

Speaker #2: And as I alluded to earlier, we've been making great strides in leasing some of the vacancy there. There's been a huge amount of work undertaken in-house.

Speaker #2: As I said, one transaction every other day, and very strong income capture from those activities. We've been really pleased. I mean, look, these are in the main parks, and we're controlling the parks and driving value through doing things such as refurbishments, proving new rental tones, and then applying that to the parks.

Speaker #2: But it's also about making sure that our customers are happy. We are a customer-led business, and ensuring that they're happy with service charges and that they're getting good value for money is absolutely key.

Colin Godfrey: Ensuring that they're happy with service charge and they're getting good value for money is absolutely key. These are high quality parks in strong locations that have got depth of demand. As I've mentioned just a moment ago, they also have the largest element of reversion attached to them. We're really happy with the Blackstone portfolio. It's going very much in the same vein as the UK CM portfolio was.

Speaker #2: And these are high-quality parks in strong locations that have got depth of demand. So and as I've mentioned just a moment ago, they also have the largest element of reversion attached to them.

Speaker #2: So we're really happy with the Blackstone portfolio. It's going very much in the same vein as the UKCM portfolio was.

Speaker #7: So, I'd like to jump in.

Frankie Whitehead: Yeah. The vacancy point quite rightly points out that increase by about 90 basis points is totally development driven. I think that's three buildings that PC'd sort of May, June time. Very recently. Just to point out that in all of our sort of underlying appraisals and assumptions for speculative buildings, we build in a 12-month void period. We'd certainly expect to lease the buildings within the assumptions set out there. There's good interest in all three buildings. Yeah, within a 12-month period is where we'd expect to be. I think the last question was about Tenant incentives. Yeah, we're not really seeing tenant incentives change. Look, I would say broadly the market's stable. There was 10.9 million square feet of take-up in the H1.

Speaker #3: Yeah. So the vacancy point, which you quite rightly pointed out, increased by about 90 basis points. It's totally development-driven. I think that's three buildings that precede.

Speaker #3: Sort of May–June time, so very recently. Just to point out that in all of our sort of underlying appraisals and assumptions for speculative buildings, we build in a 12-month void period.

Speaker #3: So we'd certainly expect to lease the buildings within the assumptions set out there. There's good interest in all three buildings, and, yes, within a 12-month period is where we'd expect to be.

Speaker #2: I think the last question was about tenant.

Speaker #7: In terms of.

Speaker #2: Tenant incentives—yeah, we're not really seeing tenant incentives change. Look, I would say broadly the market's stable. There was 10.9 million square feet of take-up in the first half.

Speaker #2: That's down a little bit on the £13 million in the prior period, but net absorption is up 20% over the period. So, as a consequence of new buildings coming on stream, I think the occupational market's in pretty good shape.

Frankie Whitehead: That's down a little bit on the 13 million in the prior period, net absorption is up 20% over the period. As a consequence of new buildings coming on stream, I think the occupation market's in pretty good shape. We're not seeing any significant impact on incentives as a result. Okay. Very clear. Thank you.

Speaker #2: And we're not seeing any significant impact on incentives as a result.

Suraj Goyal: Okay. Very clear. Thank you.

Speaker #7: That was very clear, thank you.

Speaker #4: Thank you. We'll now move on to our next question from Tomson of Brownberg. Your line is open—please go ahead.

Operator: Thank you. We'll now move on to our next question from Thomas Musson of Berenberg. Your line is open. Please go ahead.

Speaker #5: Thanks. Morning, team. Maybe it's a similar question to what you've been discussing on disposals, but because you're able to recycle capital into a space that's much more accretive now, does that mean you're willing to expand the range of assets you'd be comfortable to sell from, and therefore accept some higher disposal yields going forward?

Thomas Musson: Thanks. Morning, team. Maybe it's a similar question to what you've been discussing on disposals, because you're able to recycle capital into a space that's much more accretive now, does that mean you're willing to expand the range of assets you'd be comfortable to sell from, and therefore accept some higher disposal yields going forward? The visible funding requirements are obviously a lot higher now. Second one, can you just give a little color on the land impairments? I think that was just at two sites. Which sites were they, and what was driving that impairment? Thank you.

Speaker #5: Because the visible funding requirements are obviously a lot higher now. And then second one, can you just give a little color on the land impairments?

Speaker #5: Because I think that was just at two sites. Which sites were they, and what was driving that impairment? Thank you.

Speaker #2: Yeah. So look, there's nothing on our books that we wouldn't be prepared to sell at the right price, Tom. And you're absolutely right, selling any of our standing investments and deploying that capital into our logistics development pipeline—and more particularly, into data centers—is hugely accretive.

Frankie Whitehead: Yeah. Look, there's nothing on our books that we wouldn't be prepared to sell at the right price, Tom. You're absolutely right. Selling any of our standing investments and deploying that capital into our logistics development pipeline, and more particularly into data centers, is hugely accretive, and that's what we've been doing over the last couple of years. Of course, we are mindful of the two aspects there. Firstly, selling investments that have maximized value in our hands where we've completed our business plans. We're also mindful of the magnitude of the sales program. Our DC development CapEx is very significant up to 2030. The reason for our equity raise that we've just closed is that we don't feel it's possible to sensibly fund all of that from investment disposals.

Speaker #2: And that's what we've been doing over the last couple of years. But of course, we are mindful of the two aspects there. Firstly, selling investments that have maximized value in our hands, where we've completed our business plans.

Speaker #2: And we're also mindful of the magnitude of the sales program. Our DC development capex is very significant up to 2030, and the reason for our equity raise that we've just closed is that we don't feel it's possible to sensibly fund all of that from investment disposals.

Speaker #2: Although we've been disposing very, very successfully and to a significant degree, we don't want to be seen as false sellers in the market.

Frankie Whitehead: Although we've been disposing very successfully, and to a significant degree, we don't want to be seen to be forced sellers in the market. It's a balancing act on those things. Of course, the market has, in the very significant level of excess demand that we've received, has given us strong support for that strategy in the oversubscriptions on the equity raise last evening. We got the land impairment point. Hi, Tom. One of the impairments is pretty modest. If we look at the larger one, we go through an ongoing process of appraising the future development schemes. This particular scheme in question, I think we're seeing some challenges around the viability of progressing that scheme. I think that shows that we run the rule over these schemes pretty frequently and we are being very selective around where we choose to allocate capital.

Speaker #2: So it's a balancing act on those things. And, of course, the market—given the very significant level of excess demand that we've received—has given us strong support for that strategy in the oversubscriptions on the equity raise last evening.

Speaker #3: Pick up the land impairment point. Hi, Tom. So one of the impairments is pretty modest. But if we look at the larger we go through an ongoing process of appraising the future development schemes.

Speaker #3: This particular scheme in question—I think we're seeing some challenges around the viability of progressing that scheme. I think that shows that we run the rule over these schemes pretty frequently.

Speaker #3: And we are being very selective around where we choose to allocate capital. As a result, I mean, the particular point is around the land value.

Frankie Whitehead: The particular point is around the land value, so we do not yet own the land. It's about the residual land price that the scheme would come in at. The other thing to mention is a large part of the write-down relates to, if you remember back in 2019 when we acquired the DB Symmetry business, we paid a price for the entirety of the sites, and we had to allocate that price across the site. This is not underlying cost of option, professional fees. This is the corporate acquisition cost that sits on top of that particular scheme. We've pared that back a little bit. We'll see how we go. There are some challenges there. I think it points out that we're running the rule over these things on an ongoing basis and allocating capital appropriately.

Speaker #3: So we do not yet own the land, and it's about the residual land price that the scheme would come in at. The other thing to mention is a large part of the write-down relates to, if you remember back in 2019, when we acquired the DB Symmetry business, we paid a price for the entirety of the sites.

Speaker #3: And we had to allocate that price across the site. So this is not underlying cost-of-option professional fees; this is the corporate acquisition cost that sits on top of that particular scheme.

Speaker #3: So we've pared that back a little bit. We'll see how we go. There are some challenges there, but I think it points out that we're running the rule over these things on an ongoing basis.

Speaker #3: And allocating capital appropriately.

Speaker #5: Okay, that's helpful. Thanks very much.

Thomas Musson: Okay. That's helpful. Thanks very much.

Speaker #7: I think we've got time for one more question on the phones. There are a couple coming through on the webcast as well, but I'm conscious we're getting nearly on the half hour.

Ian Brown: I think we've got time for one more question on the phones. There's a couple coming through on the webcast as well, I'm conscious we're getting nearly on half the hour. Laura, could we just take the question from Greg Simpson, please?

Speaker #7: But Laura, could we just take the question from Greg Simpson, please?

Speaker #4: Sure. Greg, your line is open. Please go ahead.

Operator: Sure. Greg, your line is open. Please go ahead.

Speaker #5: Yeah. Morning, it's Greg from BNP. You've got £344 million of disposals for your estate, but you're guiding to up to £400 million for the full-year settlement, so not much in H2.

Greg Simpson: Yeah. Morning. It's Greg from BNP. You've got GBP 344 million of disposals year to date. Guiding to up to GBP 400 million for the full year, implying not much in H2. Can you talk a bit about the health of the investment markets you're seeing, and is it being impacted by some of the political changes in the UK and high bond yields? Secondly, just on the Manor Farm potential pre-let, can you talk about the kind of tenant lease length indexation, other terms you're kind of targeting? Is there any discussion about phase II of Manor Farm at this stage? Thank you.

Speaker #5: Can you talk a bit about the health of the investment markets you're seeing? And is it being impacted by some of the political changes in the UK and high bond yields?

Speaker #5: And then secondly, just on the Manor Farm potential pre-let, can you talk about the kind of tenant, lease length, indexation, and the terms you're targeting?

Speaker #5: And is there any discussion about phase two of Manor Farm at this stage? Thank you.

Speaker #2: Yeah, thanks, Greg. So on the disposals, yeah, we wanted to be front-footed and I think we've done very well in the first half. We're being a bit cautious in the second half there.

Colin Godfrey: Yeah, thanks, Greg. On the disposals, we wanted to be front-footed, and I think we've done very well in H1. We're being a bit cautious in H2 there. There has been a little bit of slowdown in market activity. We have to see how it plays out. It's very difficult to tell until we come back in September. I think there's still a healthy level of demand in the market. You're absolutely right. The geopolitical situation and domestic political backdrop isn't necessarily helping market confidence. As I said earlier, there's still a lot of interest in logistics development because it has very significant tailwinds, which we consider, and most of the market considers, will continue to deliver attractive rental growth and returns opportunities.

Speaker #2: There has been a little bit of slowdown in market activity. We'll have to see how it plays out. It's very difficult to tell until we come back in September.

Speaker #2: I think there's still a healthy level of demand in the market. But you're absolutely right—the geopolitical situation and domestic political backdrop aren't necessarily helping market confidence.

Speaker #2: But as I said earlier, there's still a lot of interest in logistics development, because it has very significant tailwinds, which we consider—and most of the market considers—will continue to deliver attractive rental growth and returns opportunities.

Speaker #2: So I think watch that space. We haven't disappointed in the past, and we're confident that we'll continue to deliver a good cadence of disposals to support our strategy.

Colin Godfrey: I think watch that space and we haven't disappointed in the past, and we're confident of continuing to deliver a good cadence of disposals to support our strategy. As for Manor Farm pre-lets, the deal there has been in solicitor's hands for quite some time. It's with a major co-locator, with strong balance sheet. We've agreed all the principal terms, the lease length, the rent, the review terms, the principal specification of the building, et cetera. We're pretty close now, and we're confident of concluding that, and it's in line with our business plan objectives.

Speaker #2: As for Manor Farm pre-lets, the deal there has been in solicitors' hands for quite some time. It's with a major co-locator with a strong balance sheet.

Speaker #2: We've agreed all the principal terms: the lease length, the rent, the review terms, the principal specification of the building, et cetera. So we're pretty close now.

Speaker #2: And we're confident of concluding that. And it's in line with our business plan objectives.

Speaker #5: Thank you.

Frankie Whitehead: Thank you.

Greg Simpson: Thank you.

Speaker #7: Great. Look, I'm conscious of time. We'll go quickly to the webcast. A question from Harry at BNP. Can you confirm you have enough equity funding now to complete all the already announced projects?

Ian Brown: Look, I'm conscious of time. We'll go quickly to the webcast. A question from Harry at BNP. Can you confirm you have enough equity funding now to complete all the already announced projects? Should we see the GBP 350 million raise for circa 235 megawatts DCs as a good proxy for the remaining 500 megawatts of DC potential, i.e., you might need another GBP 750 million further down the line?

Speaker #7: And should we see the 350 million pound raise for circa 235 megawatts DCs as a good proxy for the remaining 500 megawatts of DC potential, i.e., you might need another 750 million further down the line?

Colin Godfrey: That's quite a scientific way of looking at it. I think as we look forwards, we've got the funding leaves available to execute the business plan, as I said earlier. Looking at this next phase for us, being well capitalized going into that, I think is going to allow us to deliver best value for shareholders. Pointing to equity as a component of that. Clearly, last night, today, announcing the GBP 350 raise, we are announcing an enlarged opportunity. Looking back to the last time that we raised equity for cash in 2021, that was when we had a lot of pre-let opportunity and we accelerated our development program. I think every time we come to shareholders, we are either accelerating or enhancing the opportunities there. I'll just point to that when we look forwards and our various sources of capital.

Speaker #3: It's quite a scientific way of looking at it. I think, look, as we look forwards, we've got the funding leaves available to execute the business plan.

Speaker #3: As I said earlier, looking at this next phase for us, being well-capitalized going into that, I think, is going to allow us to deliver the best value for shareholders.

Speaker #3: Pointing to equity as a component of that, clearly, last night and today, announcing the £350 million raise, we are announcing an enlarged opportunity. And looking back to the last time that we raised equity for cash in 2021, that was when we had a lot of pre-let opportunity.

Speaker #3: And we accelerated our development program. So I think every time we come to shareholders, we are either accelerating or enhancing the opportunities there. So I'll just point to that when we look forward.

Speaker #3: And our various sources of capital.

Speaker #7: A question from Elliot at CCLA: Can you add some color to the vacancy of prospect developments and the average time to let the spec buildings, even though you build in a 12-month void period?

Ian Brown: Question from Elliot at CCLA. Can you add some color to the vacancy of the spec developments and the average time to let the spec buildings, even though you build a 12-month void period? What has been the average period to let up the vacant spec space?

Speaker #7: What has been the average period to let up the vacant spec space?

Colin Godfrey: I don't know the answer to that.

Speaker #2: I don't know the answer to that.

Colin Godfrey: I don't know the answer to that.

Speaker #3: And certainly within 12 months, but I couldn't give the exact—

Frankie Whitehead: It's certainly within 12 months, but I couldn't give the exact

Speaker #2: Yeah. I mean, we have in the past talked to stats of average releasing in negative territory—letting buildings, on average, before they've practically completed. We build in the sensible timeframe.

Colin Godfrey: Yeah, we have, in the past, talked to stats of average leasing in negative territory, i.e., letting buildings on average before they've practically completed. We build in a sensible timeframe and that's not coming under pressure. As Frankie says, we're certainly delivering lettings within the timeframe, but I don't have the specific number to hand. Elliot, we can come back to you on that after the presentation closes.

Speaker #2: And that's not coming under pressure. So, as Frankie says, we're certainly delivering lettings within the time frame. But I don't have the specific number to hand, Elliot.

Speaker #2: We can come back to you on that after the presentation closes.

Speaker #7: Next question from Bjorn Zeitzman: Can you give guidance around the cap rate you expect to use in valuing the power revenue received associated with the DC opportunities?

Ian Brown: Next question from Bjorn Zeitzman. Can you give guidance around the cap rate you expect to use in valuing the power revenue received associated with the DC opportunities?

Speaker #3: Yeah. Hi, Bjorn. I would apply a high single-digit cap rate there. So guide you to the 8 to 10 percent sort of level.

Frankie Whitehead: Yeah. Hi, Bjorn. I would apply a high single-digit cap rate there. Guide you to the 8% to 10% sort of level.

Speaker #7: Next question from Bjorn. The additional 235 megawatts materially increases the opportunity. Can you talk about the competitive dynamics that allowed you to secure these sites?

Ian Brown: Next question from Bjorn. The additional 235 megawatts materially increases the opportunity. Can you talk about the competitive dynamics that allowed you to secure these sites? Are similar opportunities still available or are they becoming increasingly scarce?

Speaker #7: Are similar opportunities still available? Or are they becoming increasingly scarce?

Speaker #2: Okay. Thanks, Bjorn. So I think the thing to say here is that we set up our power team and our power-first strategy five years ago.

Colin Godfrey: Okay. Thanks, Bjorn. I think the thing to say here is that we set up our power team and our Power First strategy 5 years ago, with some of the leading power brains in the UK in the business, it is all about developing relationships and understanding the opportunity set. We haven't gone about this in the way that most people do in securing land and then seeking to acquire power, because power is very difficult to come by. If you apply for power in around Heathrow today, you will be waiting 10, potentially 15 years for delivery. We have put in place some joint venture initiatives with power generators.

Speaker #2: With some of the leading power brains in the UK in the business. And it's all about developing relationships and understanding the opportunity set. So we haven't gone about this in the way that most people do, in securing land and then seeking to acquire power.

Speaker #2: Because power is very difficult to come by. If you apply for power, in around Heathrow, today, you'll be waiting 10, potentially 15 years for delivery.

Speaker #2: So we have put in place some joint venture initiatives with power generators, and it's that relationship and the work we've put in to identify power contracts, secure those, and by dint of the fact we've got a JV partner that has statutory powers, it enables us to deliver the project on time and with greater certainty than we would otherwise have.

Colin Godfrey: It is that relationship and the work we have put in to identify power contracts, secure those, and by dint of the fact we have got a JV partner that has statutory powers, it enables us to deliver the project on time, and with greater certainty than we would otherwise have. It is a direct route to power securing and delivery, that is why when we have announced the new 235 megawatts in two schemes allied to what we already have, giving us a total of 507 megawatts overall. We have said that all of that is power secured. We own the land at Chelmsford. We own the land at Manor Farm. The two new schemes, one of those we own the land on, the other one we do not.

Speaker #2: So it's a direct route to power securing and delivery. And that's why, when we've announced the new 235 megawatts in two schemes, allied to what we already have, giving us a total of 507 megawatts overall, we've said that all of that is power secured.

Speaker #2: We own the land at Chelmsford. We own the land at Manor Farm. Of the two new schemes, we own the land on one of those.

Speaker #2: The other one, we don't. But the key here is that we've got control of power and delivery of power. Within the time frame to 2030, we'll bring these schemes on tap.

Colin Godfrey: Key here is that we have got control of power and delivery of power within the timeframe to 2030 that will bring these schemes on tap.

Speaker #7: And with apologies for Darwin, we've slightly overrun. But thank you very much indeed for your questions, and I think that will probably conclude the presentation.

Ian Brown: With apologies to Derwent, we've slightly overrun, but thank you very much indeed for your questions, and I think that will probably conclude the presentation.

Colin Godfrey: Thanks everyone for joining. Really appreciate your continued interest in the company and your support. Have a good day.

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