Landsec to Bolster Strategy with £245m Queen Anne’s Mansions Sale

Landsec (LON:LAND) has solidified its strategic repositioning with the £245 million unconditional sale of its Queen Anne's Mansions (QAM) office block to Arora Group.

The transaction accelerates Landsec's broader initiative to divest £2 billion in office assets by 2030, pivoting towards properties capable of delivering sustainable income and earnings per share (EPS) growth over the long haul.

he sale is immediately accretive to Landsec's return on equity.

The QAM property, developed by Landsec in the 1970s, is currently fully leased until December 2028. A significant portion of the asset's value is tied to its future redevelopment potential, with the remaining value decreasing as rental income is received over the lease term.

The sale's early completion will result in the residual finance lease income, originally slated for receipt across 2025 and 2026, being received as a capital receipt in 2025.

“The overall amount of cash generated for Landsec is essentially the same, but this will impact EPRA earnings for FY26 by £7m and for FY27 by £15m, as a broadly equivalent sum will now be received upfront in cash as part of the sale proceeds,” explained the company.

EPRA earnings from FY28 onwards are projected to be largely unaffected, presenting potential upside as the proceeds are reinvested into accretive acquisitions.

The unconditional sale, backed by a 10% non-refundable deposit, is slated for completion in early December 2025.

The £245 million sales price is slightly below the expected book value of £256 million at that time. This book value accounts for income received and the corresponding value reduction since the last valuation date.

The disposal is expected to reduce Landsec's pro-forma March 2025 Loan-to-Value (LTV) ratio by 1.3 percentage points, bringing it down from 38.4%.

The company has already surpassed initial expectations with approximately £500 million in disposals since March 31.

CEO Mark Allan stated, “Including QAM, overall disposals since 31 March now total c. £500m, which is ahead of our initial expectations and, combined with continued robust operational performance across the business, means we are making encouraging early progress in delivering against our strategy.”

Land Securities shares are up around 0.2% in early Monday trading.