6 April 2023

HELICAL PLC

("Helical" or the "Company")

Trading Update for the Period Since 1 October 2022

Helical today provides an update covering its trading activity for the period 1 October 2022 to 5 April 2023 ("the Period") in advance of the publication of its Full Year results which will be announced on Tuesday 23 May 2023.

Commenting on the Company's activities, Gerald Kaye, Chief Executive, said:

"The recent announcement that Transport for London ("TfL") has selected Helical as its preferred partner for an initial three over-station developments will boost the Company's development pipeline to almost 790,000 sq ft (Helical share 460,000 sq ft) across four substantial office schemes, subject to formalisation of the joint venture agreement. With 100 New Bridge Street, EC4 due to start later this year and these three TfL schemes spread over the period from 2024 to 2026, this pipeline, our most significant for a number of years, is scheduled to deliver best-in-class office space into an undersupplied market each year from 2025 to 2028.

"Demand from occupiers for well located, highly sustainable offices with good amenities, which are essential in attracting and retaining the top talent, is enabling landlords with the best buildings to command premium rents.  There remains a shortage of best-in-class newly refurbished or redeveloped office buildings in central London, a dynamic that is likely to persist for the rest of this decade as the market plays catch up. With an experienced management team, a substantial development pipeline, no legacy assets and historically low gearing levels, Helical is well positioned to capitalise on the ongoing market dislocation and structural trends impacting the office sector."

Operational Performance

Pipeline

·   At 100 New Bridge Street, a resolution to grant planning permission has been received from the City of London and the final decision notice will be issued upon completion of the Section 106 Agreement. The carbon friendly new building, to be completed in spring 2025, will provide 192,000 sq ft of office space across 10 storeys, including three new floors which will benefit from exceptional views of St. Paul's Cathedral. Construction work is anticipated to commence in Q4 2023 once current office tenant Baker McKenzie vacates the building.

·   In February 2023, Helical was selected by TfL's wholly owned commercial property company, TTL Properties Limited, as the preferred investment partner for its commercial office portfolio joint venture. Contracts are expected to be concluded in the near future to formalise the joint venture, which will create well‐connected, sustainable and inclusive workspaces across central London. Initially, it will be seeded with three over‐station development ("OSD") sites, namely:

o Bank OSD - located above the recently opened Bank station entrance on Cannon Street. This eight storey office development will deliver 142,000 sq ft NIA and is scheduled to start on site in 2024.

o Southwark OSD - located above Southwark Tube station. The scheme has consent for a 220,000 sq ft NIA hybrid timber office building over 17 storeys. The development is expected to start on site in 2025.

o Paddington OSD - located on the Grand Union Canal, close to the Elizabeth Line station at Paddington. This 19-storey building will provide 235,000 sq ft NIA of office space and construction is expected to commence in 2026.

Lettings

·   In the Period we have completed five new lettings totalling 45,908 sq ft NIA, delivering contracted rent of £4.1m (our share £2.2m) at a 10.3% premium to 31 March 2022 ERVs. Lettings include:

o The sixth and seventh floors at The JJ Mack Building, EC1 to Partners Group, a leading global private markets firm. The 37,880 sq ft NIA letting, at an average rent of £99.90 psf, represents an 11.7% premium to 31 March 2022 ERVs.

o A further 3,504 sq ft NIA letting at The Loom, E1 at a rent of £55.00 psf which is in line with the 31 March 2022 ERV.

o The letting of three retail units comprising 4,524 sq ft at Barts Square, EC1. Following these lettings to LAP Bikes, MyLuthier and Little Farm/Athletic Fitness, only one retail unit remains available across the Barts Square estate.

Sales

·    At Barts Square, we have completed the sale of a further eight residential apartments during the Period. A contract for the sale of the last remaining apartment in this 236-unit residential scheme has exchanged and is due to complete later this month.

Rent Collection

·   As at 5 April 2023, we had collected 97.6% of the March quarter rent (7 April 2022: 93.4%) and expect to collect a further 1.2% via agreed payment plans.

·    We have now collected 98.5% of all rent contracted and payable for the financial year to 31 March 2023. Of the balance, 1.0% remains to be collected via payment plans with the remaining 0.5% subject to ongoing discussions.

Financing

£400m Revolving Credit Facility ("RCF")

At 31 March 2023, the Group had drawn £230m under its RCF with an effective interest rate of 3.1% and a maturity of 3.3 years. The RCF benefits from interest rate swaps at an average of 0.9% plus margin on 100% of the drawn amount for the remaining term of the facility to July 2026.

The RCF is a Sustainability Linked Loan and includes three ESG targets, which, if met, would result in a small reduction in the margin. We are due to report on our performance against these targets in our 2023 Annual Report and Accounts.

Other Facilities

In our joint ventures, we had drawn £60.4m of the £69.9m (our share) facility with Allianz to develop The JJ Mack Building, EC1. Following practical completion of the development on 30 September 2022, the effective interest rate on the loan is 4.2%, including commitment fees on the undrawn amount, reducing to 2.25% when fully let.

At 31 March 2023, the Group had c.£58m of cash and £190m of undrawn loan facilities with an overall weighted average cost of debt of 3.4% and an average maturity of 2.9 years.

Sustainability

Our commitment to sustainability continues to receive external recognition and in December 2022 we achieved a B rating from the global disclosure system CDP, an improvement from our previous rating of C. We also retained our EPRA Sustainability Best Practices Recommendations (sBPR) Gold Award and our GRESB 5 Star, reflecting our comprehensive and transparent sustainability reporting.

Notice of Results

The Group confirms that it will announce its full year results for the 12 months ended 31 March 2023 on Tuesday 23 May 2023. There will be a presentation for analysts on the morning of the results at The JJ Mack Building, 33 Charterhouse Street, London EC1M 6HA. For further details, please contact FTI Consulting.

For further information, please contact:

Schelical@fticonsulting.com