Developer wants to sell 拢2bn of portfolio in coming five years to fund move into homes

Developer Landsec said it wants to reduce its exposure to offices and include more residential in its portfolio in the coming years.

The firm, which is behind the 拢400m Hill House scheme in the City due to be built by Skanska, wants to reduce its offices business from about 65% of its near 拢10bn portfolio to closer to a third by 2030, while boosting retail and housing to roughly a third each.

It said: 鈥淟andsec will rebalance its portfolio mix, with more investment in growing its market-leading retail platform; the establishment of a sizeable residential platform, building on the 拢3bn development opportunity it has created; and, to fund this, a smaller share of capital employed in offices.鈥�

hill house

The Hill House scheme near Fleet Street has been designed by Apt and will be built by Skanska

It said it would sell 拢2bn of its current 拢6.5bn capital employed in office-led assets over the next two to five years to fund its expansion in residential.

This would involve, it said, 鈥渟caling back capital allocated to new office-led development starts by at least half following the completion of its current pipeline, to shift development capacity to residential-led projects where returns are expected to be similar but risk is lower鈥�.

Landsec, which is behind plans approved last month for a 12-storey office in Southwark, said there was still demand for high-quality office space but returns were less attractive because of the higher costs of construction and of keeping tenants.

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