Great Portland Estates plc

We unlock  
potential,  
creating space  
for London  
to thrive

Annual Report and Accounts 2020

We unlock potential, identifying 
opportunities that others may not have 
seen, harnessing the skills and talents of 
our people and a vast range of partners 
to unlock that potential. 

As the boundaries between work and 
play and public and private spaces blur, 
we are creating space demanded by  
our vibrant and truly global city. 

And we are continually innovating to 
meet the evolving needs of our occupiers, 
our people, our communities and our other 
stakeholders, creating an environment 
for London to thrive.

Strategic Report – Overview

02

03

04

05

06

A clear vision...

....delivered through our people

A clear plan and financial strength...

...supported by our deep relationships

A clear focus on creating great spaces

08 Our case studies

16

How we create value

18 Our KPI benchmarks

Strategic Report – Annual Review

21

Statement from the Chief Executive

23 Our market

30 Our near-term strategic priorities

32 Our investment activities

34 Our development activities

39 Our leasing activities

42 Our financial results

46 Our culture and people

54

56

The Board

Senior Management Team

58 Our stakeholder relationships

68 Our portfolio

78 Our capital strength

80 Our approach to risk

Governance

96 Overview

97

Introduction from the Chairman

100 Leadership and purpose

110 Division of responsibilities

112 Composition, succession 

and evaluation

118 Audit, risks and internal controls

126 Directors’ remuneration report

155 Report of the directors

158 Directors’ responsibilities statement

Financial statements

160 Group income statement

160 Group statement of 

comprehensive income

161 Group balance sheet

162 Group statement of cash flows

163 Group statement of changes in equity

164 Notes forming part of the 
Group financial statements

187 Independent auditor’s report

197 Company balance sheet 

199 Notes forming part of the 

Company financial statements

Other information

204 Five year record

205 Our properties and occupiers

208 Portfolio statistics

209 Glossary

211 Shareholders’ information

212 Financial calendar

Annual Report 2020  Great Portland Estates 01

 
A clear vision...

Statement from the Chairman

Despite these unprecedented conditions, the 
GPE team has pulled together well with all its 
stakeholders and ensured that our portfolio is 
as prepared as can be for the current situation. 
However long the COVID crisis lasts, with our 
low gearing and ample liquidity, GPE is well 
positioned to weather the impact until market 
conditions normalise.”

With our clear strategy, progressive culture and 
single focus on central London commercial property, 
we are continuing to evolve and innovate, embracing 
change and turning challenges into opportunities.

We are Great Portland Estates. We aim to deliver superior 
returns by unlocking the often hidden potential in commercial 
real estate in central London, creating great spaces for our 
occupiers, partners and communities.

Positive London prospects 
London is one of only a handful of truly global cities, with 
a commercial property market that has enduring appeal 
for occupiers and investors alike, and notwithstanding the 
current situation, we believe the long-term prospects for 
London remain positive. However, the relationship between 
real estate owners and occupiers is evolving, with our 
occupiers now wanting more, including increased flexibility 
and service provision, as well as smart tech-enabled buildings 
with outstanding sustainability and wellbeing credentials. 

Evolving and innovating
As a result, we are innovating. We are broadening our 
product and service offer, enhancing the occupier 
experience, installing technology solutions across our 
portfolio and reinvigorating communal spaces. Moreover, 
with sustainability touching everything that we do and 
moving to an economic imperative, we have set out our 
intent to become a net zero carbon business by 2030. 

Progressive culture
Our strong and talented team, underpinned by our 
progressive culture and clear values, is embracing 
opportunity and delivering this change. And with ongoing 
investment in employee training and development, we are 
continuing to promote talent from within.

Our portfolio

100% central London, with 56% in our  
development programme 

5%

8%

18%

1%

28%

36%

Business mix

Office

Retail

Residential

Locations

Unlocking potential
Looking ahead, with a portfolio full of opportunity and 
exceptional financial strength, we remain extremely well 
positioned. And together with our employees, occupiers, 
suppliers and other stakeholders, we will continue to 
unlock potential, creating space for London to thrive.

£1,865.9m

£734.0m

£24.2m

71%

North of Oxford Street

£942.0m

Our Strategic Report on pages 1 to 94 has been reviewed and 
approved by the Board. 

33%

Rest of West End

£863.7m

On behalf of the Board

City

Southwark

Midtown

£467.6m

£202.8m

£148.0m

Richard Mully
Chairman  
9 June 2020 

02

Great Portland Estates  Annual Report 2020

...delivered through 
our people

Our strong culture and values
Our open and progressive culture underpins our values, which define who we are 
and how we act. They are at the heart of what we do and are what make us special. 
They give us direction, describe how we behave and how we do business.

 › See more on our culture and people on pages 46 to 53

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Annual Report 2020  Great Portland Estates 03

 
 
 
A clear plan and  
financial strength...

Our purpose
We unlock potential, 
creating space for 
London to thrive.

 › See more on pages 16 and 17

Our strategy 
We aim to deliver superior returns by unlocking 
the often hidden potential in commercial real 
estate in central London, creating great spaces 
for occupiers and long-term value for our 
stakeholders.

Our strategy is underpinned by six 
clear principles:

100% central London; West End focus

Reposition properties let off low rents

Flex operational risk through the property cycle

Maintain low financial leverage

Disciplined capital management; raise to acquire, 
distribute excess

Sustainability touches everything we do

 › See more on pages 16 and 17

Our financial strength

IFRS net  
assets

£2.2bn

2019: £2.3bn 

Net  
gearing

16.2%

2019: 6.8% 

Loan  
to value

14.2%

2019: 8.7% 

Weighted average 
interest rate

Cash and 
undrawn facilities

2.2%

2019: 2.7%

£411m

2019: £608m

Our performance highlights 

One year

Portfolio  
valuation

£2.62bn

2019: £2.58bn  
(down 0.3% LfL) 

Ten years

Total Property  
Return (TPR)

199.0%

Benchmark: 205.2% 

EPRA NAV 
per share

868p

2019: 853p  
(up 1.8%) 

Total Property  
Return (TPR)

Total Accounting  
Return (TAR)

Total Shareholder  
Return (TSR)

3.7%

2019: 3.5%  
(up 0.2 pps) 

3.2%

2019: 2.3%  
(up 0.9 pps) 

-7.2%

2019: 14.0%  
(down 21.2 pps) 

Total Accounting  
Return (TAR)

240.5%

Benchmark: 48.0%

Total Shareholder  
Return (TSR)

152.9%

Benchmark: 106.3% 

EPRA and adjusted metrics: we prepare our financial 
statements using IFRS, however we also use a number 
of adjusted measures in assessing and managing the 
performance of the business. These measures, including 
those defined by EPRA which are designed to enhance 
transparency and comparability across the European 
real estate sector, are included in note 9 of the 
financial statements.

04

Great Portland Estates  Annual Report 2020

...supported by our  
deep relationships

Our resources and relationships
Our business model is supported by key resources 
and relationships which we constantly develop to 
ensure long-term success.

 › See more on pages 58 to 66

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Annual Report 2020  Great Portland Estates 05

 
 
 
A clear focus on 
creating great spaces

R O B E R T   S T

A
L
B
A
N
Y

S
T

O
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E
R

C

I

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A
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Great 
Great 
Portland 
Portland 
Street
Street

Euston 
Euston 
Square
Square

D

R

Warren
Warren
Street
Street

T O N  

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21

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R E G E N T ’ S   P A R K

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Regent’s 
Regent’s 
Park
Park

M A R Y L E B O N E

E

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Euston

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B L O O M S B U R Y

Russell 
Russell 
Square
Square

R U S S E L L  
R U S S E L L  
S Q U A R E
S Q U A R E

K

I

N
G

S

C

R

O

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S

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D

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’

S

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25

R
R

D
D

26

R D

E O B A L D S

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Baker 
Baker 
Street
Street

M A R Y L E B O N E   R D

C R A W F O R D   S T

B

A

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E

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NN
P O R T M A N
P O R T M A N
S Q U A R E
S Q U A R E

2

W E Y M O U T H   S T
N E W   C A V E N D I S H   S T

R

T

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A

N

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W I G M O R E   S T  

C A V E N D I S H  
C A V E N D I S H  
S Q U A R E
S Q U A R E

F I T Z R O V I A

Goodge 
Goodge 
Street
Street

P

O

R

T

L

A

N

D
D

G

D

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O
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G

20

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S

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  M O R T I M E R   S T
M O R T
7

11
11

13

10

14

D S T
O X F O R D   S T

6

Oxford
Oxford
Circus
Circus

R

D

T

E   S

23

G

O

W

E

R

24

S

T

B E D F O R D  
B E D F O R D  

S Q U A R E  
S Q U A R E  
G A R D E N
G A R D E N

22

Tottenham 
Totttt
Court Road
CouCou

S O H O
S O H O
S Q U A R E
S Q U A R E

C

H

A

R

I

N

G

19

18

E

V

Y   A

R

U

B

S

E

Leicester 
Leicester 
Square
Square

T

F

A

S H

Piccadilly
Piccadilly
Circus
Circus

R

E
E

G
G

E
E

15

N
N

T
T

S
S

T
T
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16

17

N E W   O X F O R D   S T  

Holborn
Holborn

H I G H   H O L BORN

Chancery Lane
Chancery Lane

L I N C O L N ’ S  
L I N C O L N ’ S  
I N N   F I E L D S
I N N   F I E L D S

H O L B O R N

K

I

N

G

S

W

A

Y

C

R

O

S

S

R

D

Covent 
Covent 
Garden
Garden

C O V E N T  
G A R D E N

L D W Y C H

A

F L E E T   S T
F L E E T   S T

I N N E R   T E M P L E  
I N N E R   T E M P L E  
G A R D E N S
G A R D E N S

BlaBla

Temple
Temple

A N K M E N T

A M E S

H

W

T

A

R          T

R

E

D

N

A

R

T

S

VIC T O

M B

R I A   E

RIV E

S T   J A M E S ’ S
T   J A M E S ’ S
T   J A M E S ’ S
S T   J A M E S ’ S
S Q U A R E
S Q U A R E
S Q U A R E
S Q U A R E

L
L

L
L

A
A

L   M
M
L

L
L

A
A

P
P

Charing 
Charing
Charing
Chariningngngg
Charin
Charing 
CrosCrosCrosCrosssss
Cross
Cross

Embankment
Embankment
Embankment
Embankment

L

O

O

B

R

I

D

G

E

S O U T H B A N K

T

D   S

R

O

F

M

A

T

S

L
L

L
L

A
A

M
E   M
E

H
H

T
T

S T   J A M E S ’ S  
S T   J A M E S ’ S  
S T   J A M E S ’ S
S T   J A M E S ’ S
P A R K
P A R K
P A R K
P A R K

W
W

H
H

I
I

T
T

E
E

H
H

A
A

L
L

L
L

H
H

O
O

R
R

S
S

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E

G
G
U
U
A
A
R
R
D
D
S
S
R
R
D
D

D C A G E W A L K
B I R D C A G E   W A L K

J U B I L E E  
J U B I L E E  
G A R D E N S
G A R D E N S

Waterloo
Waterloo

r
r
r
r
e
e
e
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t
t
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t
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s
s
s
s
s
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W E S T M I N S
W E S T M I N S T E R   B R I D G E

D
R

K
R
O
Y

St James’s
St James’s
St James’s
St James’s
Park
Park
ParkPark

V I C
V I C
 › See more on page 36

T O R
T O R

S T
I A   S T
I AA

B

U

C

KI

N

G

H

A

M

 G

A

T

E

A
A

B
B

W E S TW
W E S T M I N S T E R
W E S T M I N S T E R

A shortage of high quality office space 
in London has resulted in competition 
for the best buildings. As a result, 
we are seeing strong demand for 
our developments. 

O
O

N
N

N
N

G
G

D
D

T
T

S
S

I
I

D

E   R

C

A

L

T H   P

A R C H B I S H O P  
A R C H B I S H O P  

P A R K
P A R K

E
B
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A
L

W

A

T

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R

L

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D

Southwa
Southwa

T

U

  C

E

H

T

D
R

S
I
L
Y
A

B

Lambeth 
Lambeth 
North
North

D

R

N

O

T

G

N

I

N

N

E

K

W E S T M I N S T E R  

S

T

G

E

O

R

G

E’S 

Marble 
Marble 
Arch
Arch

1

Bond 
Bond 
Street
Street

4

5

H A N O V E R
H A N O V E R
S Q U A R E
S Q U A R E

B R O O K   S T

G R O S V E N O R  
G R O S V E N O R  
S Q U A R E   G A R D E N
S Q U A R E   G A R D E N

T

S

G R O S V E N O R  

M A Y F A I R

P

A

R

K

L

A

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E

H Y D E   P A R K
H Y D E   P A R K

B E R K E L E Y  
B E R K E L E Y  

S Q U A R E
S Q U A R E

9

12

Green
Green
Park
Park

D I L L Y

A

C

P I C

G R E E N   P A R K
G R E E N   P A R K

Hyde Park 
Hyde Park 
Corner
Corner

C O N S T I T U T I O N   H I L L

S

L

O

A

N

E

S

T

B E L G R A V I A

G

R

O

S

V

E

N

O

R

P

L

B E L G R A V E  
B E L G R A V E  
S Q U A R E  
S Q U A R E  

G A R D E N
G A R D E N

U

P

P

E

R

B

E

L

G

R

A

V

E

B

E

L

G

R

A

V

E

P

L

S

T

R

E

E

T

1 Newman Street & 70/88 
Oxford Street, W1
119,100 sq ft

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North of Oxford Street

1.  Mount Royal 

S

2.  35 Portman Square

Q

U

I

R

3.  Orchard Court

R

E

L

7.  Walmar House

S

T

8.  78/92 Great Portland Street

10.  6/10 Market Place

F I E L D S
F I E L D S

W E A V E R S  
W E A V E R S  

G O S S E T   S T

B E T H N A L  
G R E E N

T H N A L   G R E E N   R D

E

B

CITY RD

G

O

S

W

E

L

L

R

D

D
R

T
S
A
E

Old
Old
Street
Street

O L D   S T

30

B
B

U

N

H

I

L

L

R
O
W

C
C

I
I

T
T

Y
Y

R
R

D
D

D
D
R
RR

D
D
N
N
A
A
L
L
S
S
G
G
N
N

D
D

R
R

Y
YY
E
E

NN
N

KK
K

C O L U M B I A   R D
CC OO L U

CC
C

A
A

 › See more on page 33

T
T
S
S

D
D
L
L
E
E

I
I
F
F
T
T
I
I
P
P

During the year, we continued to sell 
buildings where our business plans 
are complete. This included the sale 
of 24/25 Britton Street which we sold 
in January 2020.

S HS H OS
S H O R E D I T C H
S H O R E D I T C H

KK
K

R
R

G
G

H
H

I
I

E
E

A
A

T
T

E
E

A
A

T
T

S
S

24/25 Britton Street, EC1
£64.5m

Shoreditch 
ShoShoreded hh
horeditch
horeditch
Shoreditch 
High Street
High Street
Highh Sth St
High St
High Street
High Street

S
S

T
T

E
E

R
R

N
N

B E E C H   S T

CHISWELL ST

33

B A R B I C A N

Moorgate
Moorgate

M
O
O
R
G
A
T
E

28

29

  LONDON WALL

Liverpool 
Liverpool 
Street
Street

E
T
A
G
S
P
O
H
S
I
B

C

O

M

M

E

R

C

I

A

L

S

T

E R K E N W E L L

C L E R K E N W E L L   R D

27

Farringdon
Farringdon

Barbican
Barbican

A
L
D
E
R
S
G
A
T

E

S

T

N

E

W

G

ATE ST

ackfriars
ackfriars

B
L
A
C
K
F
R

I

A
R
S

B
R

I

D
G
E

St Paul’s
St Paul’s

ST PA

U

L’S C H U RCHYARD

CHEAPSIDE

QU E E N   V I C T O R I A   S T

Mansion 
Mansion 
House
House

C O R N H I L L

BankBank

C I T Y   O F  
L O N D O N

K

I

N

G

W

I

L

CANNON ST

L

I

A

M

S

T

T
S
H
C
R
U
H
C
E
C
A
R
G

Monument
Monument

T

H   S

E   H I G

Aldgate
Aldgate

T

A

G

D

L

A

T

E   S

I

L

A
A

L E A D ENHALL ST
LL ST

F E N C H

T
T

S
H   S
H

C
C

R
R
U
Fenchurch 
enchurch
enchurch 
Fenchurch 
Street
Street
Street
Street

M
M

I
I

N
N

O
O

R
R

I
I

E
E

S
S

M
M
A
A

N
N
S
S

E
E

L
L

LL
L

R
R
D
D

UPPER THAMES ST

E
G
D
I
R
B
K
R
A
W
H
T
U
O
S

LOWER THAMES ST

Tower
Tower 
Tower
Tower 
Hill
Hill
HillHill

E
G
D
I
R
B
N
O
D
N
O
L

 › See more on page 35

E
E

S
S

MITH F I E L D
MITH F I E L D

W A P P I N G
W A P P I N G

S C AT L
S C AT L E R   S T

C H E S H I R E   S T

11.  Elsley House

Bethnal 
Bethnal 
Green
Green

13.  Wells & More

14.  Kent House

20.  23/24 Newman Street

V

21.   183/190 Tottenham Court Road

A

L

L

A

N

22.   1 Newman St and  
70/88 Oxford Street

C

R

E

D

23.  Rathbone Square

Whitechapel
Whitechapel

24.   31/34 Alfred Place

D

R

L

E

P

A
Rest of West End

4.  95/96 New Bond Street

N

5.  6 Brook Street

R

E
W

W H I T E C H A P E L

H

C

E

W H I T
W

35

Aldgate East
Aldgate East

D

6.  Hanover Square

9. 
C O M M E R C I A L   R D

 Pollen House

12.  The Piccadilly Buildings

L

E
E

M
M

A
A

N
N

S
S

T
T

15.  Carrington House

A

C

16.  Kingsland House

O

N

N

N

17.  103/113 Regent Street 

T

S

18.  48/54 Broadwick Street

D

R

C A B L E   S T

19.  Poland Street

R O Y A L   M I N T   S T
R O Y A L M I N T

S T

V
V

A
A

U
U

GG
G

HH
H

A
A

N
N

City, Midtown and Southwark

T H E   H I G H W A Y

25.  200 Gray’s Inn Road

S

O

UTH

W

ARK ST

31

London
London
Bridge
Bridge

32

arkark

U N I O N   S T

B
L
A
C
K
F
R

I

A
R
S

R
D

B R I D G E   R D

L

O

N

D

O

N

R

D

S

R

D

Borough
Borough

K
S O U T H W A R K

34

L

O

N

G

 L

N

G

R

E

A

T

D

O

V

E

R

S

T

W
W

A
A

Y
Y

26.  Elm Yard 

27.  24/25 Britton Street

28.  City Place House

29.   City Tower

30. 160 Old Street

31.   Minerva House

32.  New City Court

W A P P I N G  
W A P P I N G  
G A R D E N S
G A R D E N S

33.  50 Finsbury Square
WAPPING HIGH  S T
34.   46/58 Bermondsey Street

35.   The Hickman and  
Challenger House

J A M A I C A   R D

T
T

O
O

O
O

Y
Y

E
E

L
L

Technology is moving fast and we 
are utilising this technology in our 
developments to enhance the 
occupier experience, including at the 
Hickman, E1 which will be our most 
technologically advanced building 
to date.

T
T

S
S

TT
T

D
D
R
R

A N N E R S T
A N N E R   S T

The Hickman, E1
74,400 sq ft

I
I

S
S

T
T

R
R

U
U

D
D

D
D

E
E
G
G
D
D
I
I
R
R
B
B
R
R
E
E
W
W
O
O
T
T

B B E Y S T
A B B E Y   S T

BBBB
Bermondsey
Bermondsey

Rent roll

No. of occupiers

Portfolio valuation

Property sq ft 

£100.8m

2019: £100.4m 

332

2019: 326

£2,624m

2019: £2,579m 

2.6m sq ft

2019: 2.6m sq ft

Annual Report 2020  Great Portland Estates 07

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sustainability touches everything we do

If not now,
when?

This year, we announced plans to decarbonise 
our business by 2030 and committed to designing 
climate change resilient and adaptable spaces.  
The time is now to create a lasting positive social  
impact on our communities and to put health and 
wellbeing front and centre. Because, if not now, when?

Helping the planet to thrive

 › See more on page 72

2030

To be a net zero carbon business

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Great Portland Estates  Annual Report 2020

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Crystallising profits

Good  
returns

At 24/25 Britton Street, EC1, the shoe retailer Kurt Gieger’s 
office lease was due to expire in 2027. By agreeing a new  
15-year lease, together with an uplifted rent, Kurt Geiger 
secured a long-term home for their business and we created 
an asset that had strong demand in the investment market. 
Accordingly, we sold the building in January 2020 for 
£64.5 million, 11.8% ahead of the March 2019 book value.

Helping shareholders to thrive

 › See more on page 33

11.8% 

Premium to March 2019 book value

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Strong pre-leasing

Sought  
after 

1 Newman Street & 70/88 Oxford Street, W1 is the latest piece 
in the puzzle in our regeneration activities at the eastern end 
of Oxford Street. High quality buildings are in short supply, 
and testament to the quality of our development, Exane, 
the European equities business, has pre-leased the top three 
office floors of the building (39,970 sq ft) at an average rent 
of £100 per sq ft, 14 months before completion.

Helping occupiers to thrive

 › See more on page 36

629,800 sq ft 

Of GPE developments at the east end 
of Oxford Street since 2016

Annual Report 2020  Great Portland Estates 11

 
 
 
Our flex products

Flexi time

Occupier demands are changing fast and we 
are delivering space that meets their needs. 
During the year we have significantly extended 
our commitment to flexible office space, expanding 
our co-working partnerships at City Place House, 
EC2 and committing to our new flex+ product 
that enhances our existing flex offering.

Helping growing businesses to thrive

 › See more on page 41

11% 

Of office portfolio

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Annual Report 2020  Great Portland Estates 13

 
 
 
Our innovative technology 

Open  
sesame

The pace of technological change is accelerating 
fast and we are utilising its benefits to enhance the 
occupier experience. We are employing a number of 
leading technologies including our integrated building 
app ‘sesame’, which can automate access to our 
buildings and provide environmental control, and the 
use of digital twin technology to deliver real-time data 
allowing our occupiers to better understand how the 
building is operating and being utilised. All of these are 
being utilised at The Hickman, E1, our development in 
Whitechapel, our most intelligent and technologically 
advanced building to date. 

Helping occupiers to thrive

 › See more on page 69

10,000+ 

Potential app users across GPE 
portfolio

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Great Portland Estates  Annual Report 2020

Our deep development pipeline

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Future  
proof

The transformation of space remains core to our 
business model and our portfolio is stacked with future 
opportunity. We have three near-term and seven 
medium-term schemes, providing us with an exceptional 
platform of opportunities to create the sustainable 
spaces of tomorrow to enable both our occupiers 
and London to thrive.

Helping London to thrive

 › See more on page 38

56% 

Of the portfolio in our development programme

Annual Report 2020  Great Portland Estates 15

 
 
 
How we create value

We create value by applying our specialist skills to reposition 
properties, producing high quality, sustainable spaces that occupiers 
demand. We adapt our activities in tune with London’s cyclical 
property markets to maximise returns whilst managing risk.

We apply our specialist skills to reposition properties...

Acquire

Reposition

 – Disciplined approach; must be accretive to existing portfolio.

 – Through lease restructuring, the delivery of flexible space, 

 – Tired, inefficient properties, often with poor environmental 

credentials, with angles to exploit.

 – Attractive central London locations supported by 
infrastructure improvements/local investment.

refurbishment or redevelopment.

 – Deliver high quality spaces into supportive markets  

that meet and exceed occupier needs.

 – Manage risk through pre-letting, JVs and forward sales.

 – Discount to replacement cost and typically off-market.

 – Integrate ever improving sustainability standards and 

 – Off low rents and low capital values per sq ft.

 – Optionality/flexible business plans.
 › See more on our investment activities on pages 32 to 33

technological innovation into building design.

 – Enhance the local environment and public realm.

 – Deliver a positive contribution for local communities.
 › See more on our development activities on pages 34 to 38

The Hickman, E1 is our most 
recent acquisition. Here our 
activities to transform the 
building into 74,400 sq ft of 
new Grade A space are almost 
complete, with four of the 
upper floors now under offer. 
 › See more on page 35

Since 2009, we have delivered 
1.8 million sq ft of high quality, 
sustainable spaces. Today, our 
portfolio contains a wealth of 
future opportunity with 56% in 
our development programme.
 ›  See more on pages 34 

to 38

 Sustainability touches everything we do

...underpinned by key resources and relationships...

Our stakeholder relationships

Our portfolio

 – Intense, customer-focused approach to understand 

 – 100% central London focus.

occupiers’ needs. Utilising regular occupier feedback 
to create bespoke action plans.

 – Strong levels of occupier satisfaction.

 – Open relationship with debt and equity providers based 
on clear investment case and transparent disclosure.

 – Attractive locations well served by local infrastructure 

with enduring occupier demand.

 – High occupier retention, low vacancy rates and diverse 

occupier base.

 – Located in markets with high barriers to entry playing 

 – Deep relationships with key suppliers (including contractors) 

to our strengths.

and joint venture partners.

 – Positioned for future growth; 56% of portfolio 

 – Positive engagement with local communities, local authorities, 

in development programme.

and planning departments.

 › See more on our stakeholder relationships on pages 58 to 67 and 104 

to 105

 › See more on our portfolio on pages 68 to 77

...to create value
+25.3
+7.8
Net promoter score 
(willingness to 
recommend GPE)

>£280k

COVID-19 Community 
Fund created

 › See more on our KPIs on pages 18 and 19

16

Great Portland Estates  Annual Report 2020

29.4%
+6.6%
Net assets in  
joint venture

56%
+2%
Percentage of portfolio in 
development programme

2.0%
-2.8%
Vacancy rate

0.1%
-0.3%
Percentage of portfolio  
with EPC rating >E

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Retain

Recycle

 – Deliver efficient, resilient, healthy and innovative  
space to meet the demands of modern occupiers.

 – Provide a spectrum of spaces to appeal to a variety of 

 – Disciplined capital recycling through the sale of properties 
where we have executed our business plans or where we 
are able to monetise our expected future profits.

occupier needs, whether on a traditional or flexible basis.

 – Create a legacy of high quality, sustainable buildings to 

 – Constantly evolving to meet emerging trends.

 – Detailed business plan for every property reviewed quarterly 

to maximise total returns.

 – Strong sustainability metrics to enhance the long-term 

value of properties and reduce obsolescence.

 › See more in our case study on page 41

benefit London and the communities in which they are located. 

 – Reinvest proceeds into higher return opportunities.

 – Return excess equity capital to shareholders when 

reinvestment opportunities are limited.

 › See more in our case study on page 33

Our portfolio is evolving to 
deliver the spaces that occupiers 
demand. This includes the 
delivery of a variety of spaces 
including our new flexible offers.
 › See more on page 41

We have been a net seller for 
the past seven years utilising 
the strength of the investment 
market to crystallise returns. 
During the year we sold 24/25 
Britton Street, EC1.
 › See more on page 33

Our culture and people

Our capital strength 

 – Experienced management team supported by specialist 

 – Consistently strong balance sheet and conservative 

in-house portfolio management, development, investment 
and finance teams.

 – Entrepreneurial and collegiate culture based on strong 
values with disciplined approach to risk management.

 – Incentivised to deliver value to our stakeholders 

and outperform our KPI benchmarks.

 – Effective governance structure.

 – Strong employee engagement.
 › See more on our culture and people on pages 46 to 53

financial leverage.

 – Low cost, diversified debt book and plentiful liquidity.

 – Evolving debt book to align with our values via  

ESG-linked financing.

 – Disciplined allocation of capital through analytical, 

risk adjusted IRR decision making.

 – Supports progressive dividend policy.

 – Tax efficient REIT structure.
 › See more on our capital strength on pages 78 and 79

94%
+4.0%
Employees who 
recommend GPE as a 
great place to work

91%
+4.0%
Employee engagement 
index

87%
+0.0%
Employee retention 
(stability index)

£616m

Surplus equity returned to 
shareholders in past 
three years

14.2%
+5.5%
Loan to value 

2.2%
-0.5%
Weighted average 
interest rate

Annual Report 2020  Great Portland Estates 17

 
 
 
Our KPI benchmarks

Our key performance indicators (KPIs) measure the principal metrics 
that we focus on to run the business and they help determine how 
we are remunerated. Over the longer term, we aim to outperform our 
benchmarks through successfully executing our strategic priorities.

Financial KPIs

Total Shareholder Return % (TSR)

Total Accounting Return % (TAR)

40

30

20

10

0

6.5

4.0

14.0

(1.0)

2018

2019

(7.2)
(12.4)

2020

0.0

(9.3)

2017

(5.9)

(9.3)

2016

Benchmark (italics)

Rationale
TSR is a standard measure of shareholder value creation over 
time. It measures the movement in a company’s share price 
plus dividends expressed as an annual percentage movement.

Commentary
TSR of the Group is benchmarked against the 
TSR of the FTSE 350 Real Estate index (excluding agencies).
The TSR of the Group was -7.2% for the year compared to 
-12.4% for the benchmark following an improved share price 
performance given our operational successes and reduced 
discount to NAV, combined with strengthening share 
prices of London office focused REITs following the 2019 
general election.

Alignment with remuneration
Performance criteria for Executive Directors’ and certain 
senior managers’ long-term incentives.
 › See more on page 133

40

30

20

10

0

20.8

4.0

4.0

7.1

4.0

(4.6)

4.0

2.3

4.0

3.2

2016
Benchmark (italics)

2017

2018

2019

2020

Rationale
TAR is measured as absolute EPRA NAV per share growth (the 
industry standard measure of a real estate company’s success 
at creating value) plus any ordinary dividends paid, expressed 
as a percentage of the period’s opening EPRA NAV. 

Commentary
We compare our TAR to a target year on year growth of 4%–10% used 
in our remuneration arrangements (see below). For the benchmark, 
we have used the minimum hurdle. TAR was 3.2% for the year as 
NAV growth was driven by retained earnings and the share buyback 
and we continued to deliver ordinary dividend growth. This resulted 
in a 0.8 percentage point relative under-performance for the year. 
For the year ended 31 March 2021, the Group will adopt the new 
EPRA metric of EPRA NTA. For the year ended 31 March 2020, 
the Group’s EPRA NTA and EPRA NAV were the same.

Alignment with remuneration
TAR is a performance criteria for Executive Directors’ 
and certain senior managers’ long-term incentives, and 
for Executive Directors’ and employees’ annual bonus. 
 › See more on page 133 and note 9 to the accounts

Our investment activities

Our development activities

Purchases  

Sales 

£nil

£73.3m

Sales – premium to book value 

10.0%

Profit on cost 
Ungeared IRR 

Yield on cost 

Net investment 
 › See more on pages 32 and 33

£(73.3)m

Income already secured 

BREEAM Excellent (targeted) 

Committed capital expenditure 
 › See more on pages 34 to 38

14.7%

9.2%

4.8%

23.4%

100%

£66.1m

Operational measures

In addition to our KPIs, there are several 
key operational metrics that we actively 
monitor to assess the performance of 
the business and which feed into our 
KPIs. As well as measuring our financial 
performance, these operational metrics 
also measure our risk profile and 
our achievements against some of our 
sustainability and community targets. 
Each of these metrics for the year to 
31 March 2020 is shown on the right.
 › See more on our approach to risk 

on pages 80 to 93

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Great Portland Estates  Annual Report 2020

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Total Property Return % (TPR)

40

30

20

10

0

18.9

16.7

8.2
5.5

3.6

(3.0)

4.5

3.5

2.9

3.7

2016
Benchmark (italics)

2017

2018

2019

2020

Rationale
TPR measures a company’s performance at driving value from its 
property portfolio. It is calculated from the net capital growth of the 
portfolio plus net rental income derived from holding these properties 
plus profit or loss on disposals expressed as a percentage return on 
the period’s opening value as calculated by MSCI.

Commentary
TPR is compared to a benchmark of £52.9 billion of similar assets 
included in the MSCI central London benchmark. The Group generated 
a portfolio TPR of 3.7% in the year whereas the benchmark produced 
a total return of 2.9%. This outperformance results from the strong 
performance of our committed developments in the year, in particular 
at Hanover Square and The Hickman, where we are delivering prime, 
Grade A space into a supply constrained market.

Alignment with remuneration
Performance criteria for Executive Directors’ and certain senior 
managers’ long-term incentives. The capital element of TPR is 
a performance criteria for Executive Directors’ and employees’ 
annual bonus.
 › See more on page 133

New strategic non-financial KPIs for year 
to 31 March 2021
Given the growing importance of sustainability and 
our stakeholders to the success of our business, for the 
forthcoming year we will be introducing three new non-financial 
KPIs, all of which will be performance criteria for Executive 
Directors’ and certain senior managers’ annual bonus:

Sustainability
During the year, we entered into a £450 million ESG-linked 
revolving credit facility (RCF). Under the terms of the RCF, the 
margin we pay on the facility is subject to adjustment based 
on our performance against three challenging sustainability 
targets. To ensure these targets are further embedded into 
our behaviours, looking forward we will measure our aggregate 
performance against these targets as a non-financial KPI.
 › See more on pages 72 to 79

Occupier satisfaction
High levels of occupier satisfaction are critical to both 
attracting and retaining businesses in our buildings. 
Looking forward, we will conduct an annual customer 
satisfaction survey to measure our relative Net Promoter 
Score (willingness to recommend) against our peer 
group, with a target outperformance of +2 points.
 › See more on pages 58 and 59

Employee engagement
Our people are fundamental to the success of our business 
and delivery of our business plans. We are committed to 
supporting and developing our people and maintaining high 
levels of engagement. Therefore, from next year, we will aim to 
maximise our Employee Engagement Index Score with a target 
performance of greater than 75%. 
 › See more on pages 46 to 53 and 103

Our leasing activities

Our culture and people

Our portfolio

New lettings and renewals  

£14.4m

Employee retention 

87%

Movement in property valuation1 

(0.3)%

Premium to ERV (market lettings) 

Vacancy rate 

ERV growth 

Reversionary potential 

Rent collected within 7 days 
 › See more on pages 39 to 41

8.8%

2.0%

1.4%

11.7%

62.9%

Lateral moves and promotions 

10

Employees participating in optional 
Share Incentive Plan 
 › See more on pages 46 to 53

72%

Percentage of portfolio in 
development programme 

1. On a like-for-like basis.
 › See more on pages 68 to 77

Our stakeholder relationships

Our capital strength

Net promoter score 

+25.3

Net gearing 

COVID-19 Community Fund  >£280,000

Loan to value 

Staff participation in Community Day  76%
 › See more on pages 58 to 67

Weighted average interest rate 

EPRA earnings per share 
 › See more on pages 78 and 79

56%

16.2%

14.2%

2.2%

22.0p

Annual Report 2020  Great Portland Estates 19

 
 
 
Strategic Report
Annual Review

In this section:

21

Statement from the Chief Executive

23 Our market

30 Our near-term strategic priorities

32 Our investment activities

34 Our development activities

39 Our leasing activities

42 Our financial results

46 Our culture and people

54

56

The Board

Senior Management Team

58 Our stakeholder relationships

68 Our portfolio

78 Our capital strength

80 Our approach to risk

A 
S P A C E 
T O   

C O N N E C T

Technological innovation for occupiers  
to become more connected

20

Great Portland Estates  Annual Report 2020

Statement from the Chief Executive

GPE is today in the enviable position of being 
both well placed to withstand the impacts from 
the COVID crisis and able to look to our future 
with confidence.”

Toby Courtauld 
Chief Executive

Our resilient business – evolving and innovating
This financial year has been dominated by UK political 
uncertainty and ended with the onset of COVID-19, where the 
full extent of the humanitarian, societal and economic impacts 
are still too early to judge. However, against this backdrop, we 
have again shown the resilience of our business with another 
strong operational performance: we have delivered many 
leasing successes, positive progress at our development 
schemes and disciplined capital management, all underpinned 
by our financial strength, deep stakeholder relationships and 
open, progressive culture. We have also continued to evolve 
and innovate, embracing opportunity as we further broadened 
our flex product and service offer, enhancing the occupier 
experience and installing technology solutions across 
our portfolio. 

Robust financial results – exceptional balance 
sheet strength 
In this context, we are pleased to report robust results, with 
IFRS and EPRA NAV per share rising by 1.8% in the year. 
When combined with an increase in ordinary dividends of 3.3% 
to 12.6 pence per share, our total accounting return was 3.2%. 
We delivered a diluted IFRS EPS of 20.0 pence, or an increase 
of 13.4% to 22.0 pence on an EPRA basis, and had net assets 
of £2,203.1 million at 31 March 2020.
 › See more on our financials on pages 42 to 45

We have maintained our market-leading debt metrics and 
capital discipline, with our loan to value ratio at only 14.2%, 
providing substantial headroom above our Group debt 
covenants. This follows the profitable sale of 24/25 Britton 
Street, EC1 for £64.5 million and the successful completion in 
the year of our £200 million share buyback, meaning that we 
have now returned more than £615 million of surplus equity to 
shareholders since 2017. Our liquidity position is also strong 
with £411 million of available firepower and our next Group 
level debt maturity is not until 2024, with our debt profile 
further enhanced in the year through the issue of a new, 
innovative £450 million ESG-linked, unsecured revolving 
credit facility. 
 › See more on our capital strength on pages 78 and 79

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Opportunity rich portfolio – 100% central London
Across our portfolio, the like-for-like property valuation 
movement was down 0.3%, with our committed 
developments up 11.9%. Unsurprisingly our offices delivered 
a stronger relative valuation performance, up 1.0%, compared 
to retail which fell 3.5%. Continued healthy demand for Grade 
A office space in a supply constrained market resulted in 
office ERV growth of 3.5% in the year and, with investment 
market activity muted for most of the year until the decisive 
outcome to the General Election, yields trended flat. 

Notwithstanding the current situation, we believe the long-
term prospects for London remain positive given its status as 
one of only a handful of truly global cities, with a commercial 
property market that has enduring appeal for occupiers and 
investors alike. Our positioning is also good with 56% of the 
portfolio in our development programme, with a further 37% 
in buildings where we can add additional value through active 
portfolio management. Moreover, with our vacancy rate of only 
2.0%, a low average office rent of £53.40 per sq ft, reversionary 
potential of 11.7% and a further £23.9 million of rent available at 
our committed schemes, there is scope for continued organic 
growth as and when market conditions normalise. Meanwhile, 
our strong financial position will enable us to add to our 
portfolio should we unearth attractively priced opportunities 
that result from this period of uncertainty.

Embracing opportunity – meeting evolving 
occupier aspirations 
Our experience shows that office occupiers are more 
focused than ever on the benefits of a high quality working 
environment in attracting and retaining talent, with increasing 
focus on outstanding sustainability and wellbeing credentials. 
As a result, the relationship between real estate owners 
and occupiers is evolving, with our occupiers now wanting 
increased levels of flexibility and service along with the 
provision of smart, tech-enabled buildings. 

Our constant commitment to creating exceptional workspace 
has enabled us to deliver another strong leasing year, securing 
£14.4 million of annual rent, 8.8% above our valuer’s ERV. 
We have also expanded our flexible space offering, which 
now represents 11% of our office space. Our team has also 
crystallised significant rental reversion across the investment 
portfolio, with 29 rent reviews settled securing £13.2 million 
at an average increase of 19.7% above the previous rent and 
beating ERV by 1.5%. Moreover, we have achieved high levels 
of occupier satisfaction, with our net promoter score of +25.3 
almost double the UK property sector average.

These successes were supported during the year by the 
realignment of the operating structure of our Occupier 
and Property Services team and the roll-out of our new app 
‘sesame’ across the portfolio. Meanwhile, our ambitions to 
embrace technology across our business were demonstrated 
by our investment in Pi Labs European PropTech VC fund 
during the year. Moreover, with sustainability considerations 
now featuring in everything that we do as they become an 
economic as well as moral imperative, we committed to the 
ground breaking Climate Change Commitment launched 
by the Better Buildings Partnership and stated our intention 
to become a net zero carbon business by 2030, as set out 
in our new sustainability Statement of Intent. 

Annual Report 2020  Great Portland Estates 21

 
 
 
 
Statement from the Chief Executive continued

We also performed strongly again across leading sustainability 
indices, including achieving a five star rating in GRESB for the 
fourth consecutive year. 
 › See more on our development activities on pages 34 to 38

Committed to excellence – good development 
progress, although completion delays expected 
given COVID-19 
Our three on-site development schemes are all near Crossrail 
stations and will provide 414,600 sq ft of Grade A, office 
and retail space, along with exciting new public realm. 
With construction progressing well before a brief pause 
during the initial weeks of the COVID-19 lockdown and a 
subsequent resumption of activities at slower rates, in part 
due to social distancing and delays in accessing raw materials, 
expected completion dates have inevitably been delayed 
somewhat. However, the schemes are expected to deliver 
a profit on cost of 14.7% and we are on track to achieve 
BREEAM Excellent sustainability ratings. Taken together, 
the schemes are 48% pre-let or under offer. 

Our Hanover Square scheme is the largest with 221,100 sq 
ft of new office, retail and residential space, where we have 
already pre-let 52%, with the first retail unit now handed 
over to the occupier. A further 14.6% is under offer, with 
the scheme now expected to complete by October 2020. 
At The Hickman, E1, completion is anticipated this summer 
and occupier interest in the new 74,400 sq ft office building 
is encouraging, with 46% currently under offer. We are 
also pleased to have over half of the office space pre-let at 
1 Newman & 70/88 Oxford Street (previously Oxford House), 
our 119,100 sq ft new build office and retail development at 
the east end of Oxford Street, opposite the new Tottenham 
Court Road Crossrail station.

Looking ahead, we have a substantial and flexible pipeline 
of ten uncommitted schemes totalling 1.4 million sq ft across 
four London boroughs, including three near-term schemes 
of 821,600 sq ft where we are currently working with both 
the local authorities and communities to secure planning 
to create great new spaces, helping London to thrive. 
 › See more on our capital strength on pages 78 and 79

Open and fair – supporting our occupiers, 
suppliers, partners and communities
The unprecedented situation arising from COVID-19 has 
highlighted the ongoing importance of our collaborative 
stakeholder relationships, including with our joint venture 
partners. We are maintaining our payment terms with our 
suppliers to support their cash flow given the challenging 
economic backdrop and are working with our occupiers, 
particularly in the retail, hospitality and leisure sectors, 
through agreeing on a case by case basis, the payment of 
monthly rents or deferring rental payments. Unsurprisingly, 
this resulted in our March rent collection rates being 
significantly behind historical levels and we expect this to 
persist into the June quarter date. We have worked closely 
with our suppliers and occupiers, with health and safety 
always a key consideration, to keep our development sites 
open and our occupied buildings operational with social 
distancing requirements in place. 

We have also extended the scope of our community 
activities by launching a new Community Fund seeded by 
GPE directors and employees to bring some relief to those 
in London hardest hit by the COVID-19 crisis.
 › See more on our communities on pages 60 to 62

Our talented team – achieving more together 
Last but not least, all of our activities and successes in the year 
could not have been delivered without the fabulous efforts 
of our talented team and I would like to say a personal thank 
you to all my colleagues at GPE. 

Over the year, the strength of our values and the magnetic 
appeal of our culture was highlighted with our most recent 
employee engagement survey showing 94% of our people 
would “recommend GPE as a great place to work” and we 
were delighted to make several internal Senior Management 
Team promotions during the year, as we develop our talent 
from within. We also successfully launched our Inclusion and 
Diversity strategy at an event attended by all employees, 
with valuable participation from our Non-Executive Directors, 
and we are pleased to have now achieved the National 
Equality Standard accreditation.
 › See more on our people and culture on pages 46 to 53

Outlook 
GPE is today in the enviable position of being both well 
placed to withstand the impacts from the COVID crisis and 
able to look to our future with confidence.

Whilst much of the year to March 2020 was characterised 
by political and economic uncertainty, nothing could have 
prepared us for the social and economic consequences of 
the COVID pandemic and I am proud of the response from 
each and every member of the GPE team. We are engaging 
extensively with our occupiers, offering assistance on a case 
by case basis and have established a new Community Fund, 
seeded by GPE’s people to bring some relief to those in 
London hardest hit by the crisis. 

As we examine the implications for our business, it is 
clear that we must plan for a recession with an increase in 
unemployment, leading to reduced occupational demand 
for space, implying falling rental and capital values. Key to our 
market’s performance will be both the depth of the downturn 
and the shape of the recovery. Given this uncertainty, we are 
pausing the provision of guidance on rental value movements 
until the picture becomes clearer. Whatever the outcome, 
whilst some working practices might change, our human 
desire to congregate and create underpins our belief that 
London’s magnetic appeal as a global business capital will 
persist for the long term. This belief is reinforced by our 
current leasing discussions, illustrating occupiers’ ongoing 
appetite to secure high quality, sustainable space. 

Guided by our strong purpose and unifying values, we have 
positioned GPE for any market eventuality; our low leverage 
is both defensive and gives us significant capacity for growth; 
our portfolio is virtually fully let, off low rents and has material 
upside potential from our extensive development pipeline; 
and our talented team with its deep market knowledge, 
combined with our financial strength, gives us the ability 
to choose our path to deliver on all our ambitions.

22

Great Portland Estates  Annual Report 2020

Our market

Global growth in 2019 was at the weakest level 
since the global financial crisis of 2008. Rising trade 
barriers and associated uncertainty weighed on 
business sentiment and activity globally. Closer to 
home, the UK’s exit from the EU dominated the 
agenda and impacted business confidence. 
The decisive election outcome late last year 
provided greater clarity, but more recently this has 
been overshadowed by the spread and economic 
consequences of COVID-19. 

The last twelve months have been marked by a combination 
of muted global growth and heightened levels of political 
and macro-economic uncertainty. Whilst the general election 
result in late 2019 in part alleviated the opaque political 
outlook, the recent economic shutdown as a result of 
COVID-19 is likely to disrupt global growth for some time to 
come. Furthermore, our future trading relations with the EU 
and the rest of the world still remain unresolved.

Global recession driven by global pandemic
Global equity markets had a strong 2019 with many indices 
reaching record highs. Whilst equity markets were positive, 
the underlying global economic backdrop remained relatively 
weak. Manufacturing activity was low, at levels not seen 
since the global financial crisis, trade disputes had impacted 
levels of global trade and business confidence and regional 
geopolitical tensions remained. The subsequent arrival of the 
COVID-19 pandemic has inflicted a tragic human cost and 
has resulted in a necessary global shutdown that is severely 
affecting economic activity. As a result, Oxford Economics 
predict that the global economy will contract sharply, by 2.8% 
in 2020, a downturn more severe than the 2008/09 financial 
crisis. This reduction is the result of an estimated 7% first 
half fall, partly offset by a rebound by the end of the year. 
However, the risks and uncertainties around current forecasts 
are large and highly dependent on the easing of existing 
shutdowns over the coming months.

UK recession set to follow
In the UK, equity markets during 2019 were volatile with 
movements clearly correlated to the UK Government’s 
progress in navigating the UK’s exit from the EU. Overall UK 
GDP grew by a modest 1.4% during the year. As with the 
rest of the world, the start of 2020 was marked by the impact 
of COVID-19 and forecast domestic growth has now been 
replaced by an expected steep recession. Oxford Economics 
forecast annual GDP to fall by 5.1% in 2020, bouncing back to 
6.0% growth in 2021. 

83%

Fall in UK CFO optimism

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Business confidence at record lows
Business and consumer confidence was fragile in 2019, as 
Brexit uncertainty dominated the national debate. The brief 
period of relief earlier this year, following December’s decisive 
election result, was quickly ended by the arrival of COVID-19. 
PwC estimate that the current lockdown has resulted in 24% 
of UK businesses having to cease or pause trading. Whilst the 
Government response has been swift, confidence has hit 
record lows with Purchasing Manager Indices signalling the 
fastest ever recorded decline in business activity. 

This negative sentiment is also reflected by the UK CFO 
community in Deloitte’s most recent survey. It reported 
that 83% of CFOs are less optimistic than they were three 
months ago.

Deloitte survey of UK CFOs: business optimism

60
40
20
0
-20
-40
-60
-80
-100

2017
Q4

2018
Q1

2018
Q2

2018
Q3

2018
Q4

2019
Q1

2019
Q2

2019
Q3

2019
Q4

2020
Q1

Source: Deloitte Q1 2020

Furthermore, with the expectation that demand is unlikely 
to return until 2021, CFOs are more focused on defensive 
strategies, including reducing costs, increasing cash flow and 
reducing leverage, than at any time since 2010. 

Looking forward, the current crisis is likely to have a significant 
impact on the UK economy. Whilst the pandemic itself is 
expected to be overcome in the near future, the impact on 
business activity, unemployment and the public finances 
are expected to be much longer lived. However, given its 
unprecedented nature, it is too early to tell the likely impact 
COVID-19 will have on London’s property markets. 

Despite this challenging context, we remain well placed. 
Our low financial leverage will enable us to both weather 
market volatility and take advantage of any dislocation should 
it arise. But whatever the outcome, beyond the current 
disruption, we remain confident in the ability of London to 
attract businesses, capital and talent from around the world, 
with London expected to remain one of only a handful of truly 
global cities. 

Moreover, it is possible that COVID-19 further accelerates 
some of the key existing trends in the London market. 
This may include the structural shift of retail sales to the 
internet, but also accelerate some trends that GPE has 
already been capitalising on, such as office occupiers 
seeking both increased flexibility and service provision, with 
a preference for Grade A space with strong sustainability 
and wellbeing credentials. In addition, with underlying 
interest rates having now fallen to unprecedented lows, the 
relative investment pricing attractions of London offices may 
persist, particularly when compared to pricing in other major 
global cities.

Annual Report 2020  Great Portland Estates 23

 
 
 
 
Our London

10 million

2030 expected London population

London generates around 22% of UK GDP, with 
the largest economy of any city in Europe, and is 
one of the world’s leading commercial, creative 
and financial centres. 

Despite the uncertainty created by the UK’s exit from the 
EU and the more recent economic disruption as a result of 
COVID-19, London has been growing and is forecast to grow 
further. By 2030, London’s population is expected to have 
increased to around ten million, up from around nine million 
today, and improving infrastructure, including extensions of 
the tube network and the expected opening of Crossrail in 
2021, will bring more people within its reach. Its combination 
of a strong legal system, time zone advantages, international 
connectivity and a welcoming attitude to businesses from 
around the world has resulted in London retaining its position 
leading the Global Power City Index 2019, as measured by 
Mori Memorial Foundation. 

Deep, liquid real estate markets
Central London has one of the world’s largest commercial 
real estate markets, with around 440 million sq ft of office 
and retail property attracting a deep and diverse mix of 
occupiers and property investors, many from overseas. 
London’s markets are also highly liquid and remain one of 
the leading global destinations for real estate investment.

Notwithstanding these strengths, for most of the year 
sentiment in London’s commercial property markets 
remained muted, as political and economic uncertainty 
continued to dominate. 

Whilst our markets have trended broadly flat in recent years, 
and with considerably less volatility than the previous decade, 
we expect that London’s commercial property markets will 
likely remain cyclical. Our strategy is designed to allow us to 
capture any opportunities that this cyclicality creates, both 
through flexing our activities and operational risk in tune 
with market conditions whilst always maintaining low levels 
of financial gearing.
 › See more on pages 16 and 17

A West End focus in a growing London
Our historical focus has been in the West End, an area 
of London that provides a unique and diverse mix of 
commercial, retail, residential, cultural and tourist attractions, 
drawing people and businesses from around the world. 
It is also home to a broad range of occupiers, and, as a 
result, its success is not reliant on a single dominant sector. 
Furthermore, the barriers to developing buildings in the 
West End are high, and navigating these barriers requires 
specialist skills and knowledge. This plays to our strengths. 

However, we know that modern occupiers expect more 
from their real estate. Regeneration, often associated with 
new infrastructure, combined with a shortage of new space 
in the core, means businesses are increasingly willing to 
move to new locations in central London to find the right 
space. Our portfolio reflects this, with many of our future 
development opportunities set to deliver high quality 
spaces in areas benefiting from this shift, including new 
and exciting projects in Southwark and the City fringe. 
 › See more on pages 34 to 38

22%

Of UK GDP generated by London

24

Great Portland Estates  Annual Report 2020

Our occupational markets

Our occupational markets have remained highly 
active, despite a year marked by political and 
economic turbulence. More recently, supportive 
fundamentals have been disrupted by COVID-19, 
with take-up slowing in 2020. 

The prospect of an ongoing uncertain outlook, often 
combined with a structural need to move due to lease expiries, 
has encouraged businesses to look beyond short-term macro 
uncertainties to secure the right home for the long-term 
success of their business. To date, this resilient demand, 
combined with a shortage of high quality space, has ensured 
that the best space has continued to let well, supporting prime 
rents. Whilst the fundamentals in our markets have been 
supportive to date, looking forward it is too early to assess 
what the impact of the COVID-19 pandemic will be.

For the year ended 31 March 2020, central London take-
up was 12.7 million sq ft, 7.1% lower than the preceding 
12 months and 3.4% below the ten-year annual average of 
13.1 million sq ft. Take-up was once again from a diverse 
range of industries with professional and business services 
(27%), creative industries (18%) and banking and finance 
(15%) the dominant sectors in Q1 2020.

Supply of new space remains limited; 60% of all 
space under construction already pre-let 
Whilst demand for high quality space currently remains 
robust, the supply of new buildings across central London 
remains limited, with development completions for the year 
to 31 March 2020 of 1.3 million sq ft, down from 4.1 million 
sq ft in the preceding 12 months. Moreover, in the core of 
the West End, where the majority of our portfolio is located, 
development completions totalled only 45,300 sq ft over the 
year. The combination of an increasingly challenging planning 
regime, continued macro-economic uncertainty and limited 
availability of speculative development debt finance has 
helped restrict the delivery of new space. Looking ahead, as 
shown in the chart below, CBRE expects 35.8 million sq ft of 
new office space to be delivered in central London over the 
five years to December 2024. Given the bulk of this space 
is yet to start on site, we expect that the current slowdown 
in construction activity as a result of COVID-19 is likely to 
exacerbate this shortage further as schemes are delayed. 

Central London developments million sq ft

12

10

8

6

4

2

0

2010

2013

2011
2012
Completed
Proposed Let/Under Offer

2017
2014
U/C Let/Under Offer

2015

2016

Proposed Available

2018

2019
2021
2020
U/C Available

2022

2023

2024

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This lack of development activity has limited new supply 
in our key markets, and with healthy occupier demand 
particularly at the prime end, this has kept availability 
relatively tight. Availability was 14.0 million sq ft at 31 March 
2020, with new space only 28% of the total, up marginally from 
13.7 million sq ft this time last year. Vacancy was low at 4.5% 
at 31 March 2020, up from 4.3% a year earlier. A lack of high 
quality space has led occupiers to be increasingly motivated 
to secure new space in advance of buildings completing. 
Pre-lets represented 25% of all take-up in the year to 31 March 
2020 and 60% of future development completions are 
already pre-leased. Furthermore, occupiers are looking much 
further ahead to secure space depending on the size of their 
requirement. Today, occupiers are often seeking to secure 
space two years ahead of time for requirements of up to 
100,000 sq ft and for very large spaces of up to 500,000 sq ft 
much longer. 

West End occupational markets
Over the year to 31 March 2020, West End office take-up 
was 4.0 million sq ft, broadly in line with the preceding year. 
However, at the prime end, the take-up of new and pre-let 
space was 0.9 million sq ft, down 16.5% on the previous year 
and the lowest since 2013. Tight levels of supply of high 
quality space is particularly acute in the West End, with new 
space only 16.6% of total availability. Vacancy rates also 
remain low with Grade A space vacancy estimated by CBRE 
to be only 1.8% of total vacant space. Accordingly, CBRE 
reported that prime office rental values in the West End rose 
to £110.0 per sq ft, up from £107.50 a year earlier. Rent free 
periods on average remained flat at around 23 months on 
a ten-year term. 

Wider UK retailing has suffered from a combination of lower 
retail sales and a structural shift, as increasing volumes of 
sales move online. However, prior to the arrival of COVID-19, 
central London retail demonstrated resilience and had 
suffered to a lesser extent. However, with stores now closed, 
the challenges facing retailers in London have grown. 
This was reflected in our own portfolio where retail rental 
values softened across London’s key shopping streets, 
down overall by 4.3% during the year. 

City, Midtown and Southwark occupational markets
Over the year to 31 March 2020, City office take-up was 
5.9 million sq ft, up 2.6% on the preceding year, with 
availability of 6.0 million sq ft (up 3.6%) and broadly in line 
with the ten-year average of 5.9 million sq ft. Although higher 
than in the West End, vacancy rates remain low with Grade A 
vacancy estimated by CBRE to be only 3.5%. CBRE has also 
reported that prime City rental values increased by 2.8% to 
£73.00 per sq ft. 

Midtown and Southwark office take-up was 1.7 million sq ft, 
down 49.1% on the preceding year as activity was limited 
by a shortage of high quality stock. Availability at 31 March 
2020 stood at 1.8 million sq ft, down 20.3% during the year, 
and lower than the ten-year average of 2.3 million sq ft. 
CBRE reported prime office rents in Southwark and Midtown 
increased to £70.00 per sq ft (up from £65.00 per sq ft) and 
£82.50 (up from £80.00 per sq ft) respectively.

Source: CBRE Research

Annual Report 2020  Great Portland Estates 25

 
 
 
 
Our market challenges

The four key challenges in our markets...

The growth of flexible space 

Structural retail change 

London has witnessed significant growth in the provision 
of flexible office and co-working space in recent years. 
Advances in technology, the growth in start-up businesses, 
increased mobility in the workforce and the rise of the gig 
economy has helped drive this growth, and a plethora 
of new suppliers have come into the market to provide 
it. Flexible space represented 16% of annual take-up in 
2019, and comprises an estimated 6% of central London’s 
office market.

UK retailing continues to suffer from a combination of lower 
retail sales and a structural shift as increasing volumes of 
sales move online. This trend has been further exacerbated 
by the economic impact of COVID-19 and associated forced 
store closures. Together these factors have put pressure on 
retailers to adapt their business models and, in some cases, 
greatly reduce the retail space they occupy. A number of 
high profile corporate failures demonstrate that many have 
not adapted quickly enough to this changing landscape.

Flexible workspace1 m sq ft

Market rental value growth index

20

10

0

5.2%

1.5%

2007

2.2%

2012

2019

Flexible workplace stock
Flexible workplaces as percentage of total stock (rhs)

8.0%

4.0%

0.0%

200

180

160

140

120

100

80

60

Mar
2010

Mar
2012
West End Retail

Mar
2014
London Retail

Mar
2016

Mar
2018

Mar
2020

Rest of UK Retail

1.  Cushman & Wakefield

Source: MSCI

... provide us with opportunities.

Whilst for many businesses, securing high quality, well-
located space for longer-term occupation is vital, we 
recognise occupiers are increasingly seeking an element of 
flexibility for some parts of their business. We are currently 
meeting this market demand through a number of flexible 
offers. Firstly, our flex space which provides dedicated, 
fully fitted space on flexible terms allowing occupiers to 
move in and out of the space with ease. We are also in 
the process of refurbishing our first flex plus space which 
will extend this offer to provide additional services and 
amenity. This new space in Soho will complete later this 
year and early interest has been positive.

On larger spaces, we have entered into partnership 
arrangements, often to maximise cash flow ahead of 
redevelopment, to deliver flexible solutions and co-
working environments with our most recent deal being 
with Knotel at City Place House, EC2. Looking forward, 
we consider that more flexible spaces will become an 
essential part of our development pipeline and for smaller 
spaces, under 10,000 sq ft, the default requirement.

In total, our flexible space now comprises 219,600 sq ft 
or 11% of our office portfolio.
 › See more on page 41

London has not been immune to these changes. However, 
central London possesses a number of characteristics which 
have softened their impact to date. High levels of tourism (both 
domestic and international), flagship stores, a deep cultural 
offering and its growing population have contributed to its 
relative resilience. 

Today retail space comprises 28% of our portfolio by value. 
We focus on delivering high quality, modern retail units 
into locations with enduring appeal with the bulk of our 
activities centred on the prime shopping streets of Oxford 
Street, Regent Street, Bond Street and Piccadilly. Our recent 
development activity at 1 Newman Street & 70/88 Oxford 
Street, W1, at the eastern end of Oxford Street, and Hanover 
Square, at the northern end of Bond Street, aim to deliver 
new retail experiences into locations that will benefit from the 
expected opening of Crossrail in 2021, following recent delays. 
Early interest in the schemes has been encouraging and during 
the year we completed our first retail letting in our Hanover 
Square scheme. 

Other locations have been more challenging, particularly where 
the real estate is ageing, including at our Mount Royal scheme at 
the western end of Oxford Street. Here the future development 
opportunity remains, both to refresh and improve the retail offer, 
but more importantly to potentially create a large mixed-use 
scheme on a two acre site in the heart of the West End. 
 › See more on pages 34 and 36

26

Great Portland Estates  Annual Report 2020

Attracting and retaining talent

The climate change challenge

High quality workplaces are increasingly seen as an 
important tool for recruiting and retaining an enthusiastic 
and productive workforce. The nature of a successful 
workplace is also changing. Our research suggests that 
occupiers have an increasing need for offices that can 
adapt to accommodate the various ways in which people 
work, that embrace technology to allow occupiers to be 
more mobile, provide additional on-site services and are 
highly sustainable. With the supply of such space limited, 
occupiers are increasingly seeking to pre-let a number of 
years in advance to ensure they can secure the right space 
for their business. 

Climate change is arguably the biggest long-term 
challenge we face and, as the risk and need for urgent 
action increases, the climate debate has moved from 
the periphery to now being both a moral and economic 
imperative. With the built environment contributing 
approximately 40% of the UK’s carbon footprint, we have 
an obligation to play our part in adapting to and mitigating 
the risk and want to make a positive impact, helping London 
to thrive. Our occupiers are increasingly aware of their 
own contribution to climate change and their employees 
are demanding a change in approach. They are therefore 
adjusting their occupational requirements accordingly.

Central London prime office developments  
months to let 75%1

The Time is Now

25
20
15
10
5
0
-5
-10
-15

We have recently launched 
our Statement of Intent 
‘The Time is Now’.
 ›   See more on pages 

8 and 9

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2011

2010
Actual
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2016

2017

2013

2015

2014

2018

2019

1.  CBRE Research; average months to let 75% of all buildings  

completed in year

We are responding to this by ensuring we are delivering 
the spaces that occupiers want. We stay close to our 
existing customers to understand their needs to ensure 
our buildings and the services we provide meet their 
requirements. Furthermore, on new spaces, whether 
flex or in the development pipeline, we are steered 
by our Guiding Principles for Design and our Design 
Review Panel to think ahead to challenge and anticipate 
the products and services that our occupiers will need 
over the next few years and beyond. 

Our strong track record is demonstrated by our leasing 
success. Over the past decade the vast majority of our 
developments have been pre-let ahead of completion, 
allowing us to work with many of the occupiers to shape 
their spaces for their business needs. We have seen strong 
pre-let interest across our committed and near-term 
developments during the year. Today, we have 61,600 sq ft 
of space under offer across our three committed schemes 
and are in conversations with prospective occupiers on 
a number of our near-term schemes, some of which will 
not complete until 2026.
 › See more on pages 34 to 38

In order to produce buildings to attract the occupiers of 
tomorrow, we must address our carbon footprint across 
our portfolio, both in our existing buildings and also 
through our development pipeline. Where we develop 
buildings, we seek to reduce our footprint through design 
efficiency using an appropriate mix of renewable and low 
carbon energy technologies and local energy generation 
solutions. We also seek to reduce embodied carbon 
through considering the type or quantity of materials 
used, technological innovation and efficient construction 
techniques. These measures will support our ambition 
to decarbonise our business to become net zero carbon 
by 2030. Last year we also announced targets to reduce 
energy intensity in our existing buildings by 40% (from a 
2016 baseline) by 2030 and to delivering net zero carbon 
new build developments from 2030. These are challenging 
ambitions. We are already working with our occupiers and 
deep into our supply chains as we will need to collaborate 
with all our stakeholders to achieve them. 
 › See more on pages 72 and 73

Annual Report 2020  Great Portland Estates 27

 
 
 
 
Our investment markets

Transactions in London slowed as political 
instability in 2019 provided an uncertain outlook 
for the investment market. This was briefly lifted 
by a decisive election result, albeit activity in 
2020 is likely to be shaped by the global impact 
of COVID-19.

Investment markets in 2019 were marked by the uncertainty 
created by the UK’s ongoing negotiations to exit the EU and 
general election in December. Despite a flurry of transactions 
in the last few weeks of the year, following the decisive 
election result, investment activity totalled £11.3 billion, 
down 35.7% from £17.6 billion in 2018. Whilst overall volumes 
were down, the themes within the investment demand were 
unchanged. Demand continued to be strong for prime, 
well-let and well-located assets. We also continued to 
see strong demand for sites with near-term development 
opportunities as investors sought to increase their returns 
beyond those provided by low yielding, longer let assets. 
Investment markets were more domestically focused in 
2019 with many overseas investors pausing for greater 
clarity, accounting for 53% of transactions down from 
76% a year earlier. 

Volumes for first quarter of 2020 impacted 
COVID-19 
The arrival of COVID-19 has slowed investment activity 
considerably, as many buyers await greater clarity on its 
economic impact before committing to a purchase. In the 
meantime, whilst some buyers are seeking discounted 
pricing, vendors are unwilling to reduce prices as, to date, 
levels of financial stress are low. Moreover, buyers are facing 
logistical challenges as the ongoing lockdown has restricted 
travel and hampered the ability of more willing buyers to 
conduct effective due diligence. Office investment deals 
in the first quarter of 2020 were £1.4 billion, down 38% on 
the equivalent quarter of 2019 and down 55% on the ten-
year average for a first quarter, with most successful deals 
commencing prior to the lockdown. We anticipate that 
turnover will continue to be muted until the economic and 
social backdrop returns to a more normalised environment. 

London investment volumes £bn 

6

5

4

3

2

1

0

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

2015

2016

2017

2018

2019

Q1
2020

Total

4 Quarter average

Source: CBRE Research

28

Great Portland Estates  Annual Report 2020

Over the year, prime yields remained stable in both the 
West End and the City at 3.75% and 4.00% respectively. 
Whilst the expected post-election yield compression is now 
unlikely, London offices continue to be attractively priced 
when compared to other major cities. Moreover, relative to 
both government and corporate bonds, London real estate 
continues to offer relative value in a global environment 
where sustainable yield is scarce. 

London: High Relative Yields (Prime Office) %

4.0

3.0

2.0

1.0

0

-1.0

-2.0

Tokyo

Hong Kong

Paris

Berlin

New York

Real 10 yr Gilt

Central London

Source: JLL, Initial Yields 

London retail investment volumes reduced in 2019 to 
£1.2 billion, down from £1.7 billion in 2018, remaining well 
below the five-year average. The structural changes facing 
the retail sector deepened during the year, resulting in buyers 
being more selective. More recently, the impact of COVID-19 
has closed stores across the globe adding further to retailer 
financial distress. Whilst investment volumes have been light, 
CBRE reported that prime yields rose during the year to 2.5% 
and 3.25% on Bond Street and Oxford Street respectively.

Notwithstanding the present disruption, over the medium 
term we expect that London’s relative value, combined with 
its transparent legal system, its position as a global hub and 
perceived safe haven status will continue to attract capital 
from around the globe.
 › See more on page 24

Cautious equity demand
At the end of 2019, CBRE estimated that there was 
£32.75 billion of equity targeting London, and this was 
trending upwards in early 2020, largely driven by European 
investors. Given the uncertain backdrop, many international 
investors are now inevitably cautious and are monitoring 
the market, particularly with the ongoing travel restrictions. 
However, CBRE see no evidence that the strong fundamentals 
of the market will not continue and drive more interest from 
pent-up demand in the medium term when normality returns. 

Near-term outlook for rents and yields
The unprecedented nature of the current COVID-19 situation 
means that, at this stage, it is too early to judge the market 
outlook with any certainty or provide rental value guidance 
for the new financial year. However, we do expect to see 
some yield expansion for both office and retail properties, 
although London’s yields today still remain attractive relative 
to other global cities and underlying interest rates. 

Our lead indicators are less favourable
Given the cyclical nature of our markets, we actively monitor numerous lead indicators to help identify key trends in our 
marketplace. In recent months, we have seen our property capital value indicators deteriorate markedly due to the impact of 
COVID-19 on the UK economy. Whilst market rents and yields have yet to fully reflect the changing economic environment, the 
prospect of a UK recession would suggest that the trajectory for values, from here, will be down. At present, visibility is poor on 
both the depth and longevity of any downturn. However, we remain well placed and we have the financial strength to allow us 
to choose our own path whatever the market backdrop.

Drivers of rents

GDP/GVA growth
Business investment
Confidence
Employment growth
Active demand/take-up
Vacancy rates
Development completions

Drivers of yields
Rental growth
Weight of money
Gilts
BBB Bonds
Exchange rates
Political risk

2019 
Outlook

2020 
Outlook

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COVID-19 has had an abrupt impact on the 
investment market, with transactions slowing 
in the first quarter of 2020. However, whilst 
levels of demand are currently hard to read, 
vendors have to date remained composed and 
the amount of stock available on the market 
remains extremely low.”

Alexa Baden-Powell
Investment Manager

Annual Report 2020  Great Portland Estates 29

 
 
 
 
Our near-term strategic priorities

We have a clear strategic focus that enables us to deliver attractive long-term 
value to our stakeholders. Our primary focus remains on maximising value 
from our portfolio organically through creating exciting spaces for occupiers, 
driving rental growth, delivering developments and recycling capital, whilst 
continuing to explore acquisition opportunities where we see value.
 › See more on pages 16 and 17

Near-term strategic priorities 2019/20

Further recycling  
and selective  
investment activity
 › See more on pages 32 and 33

Progress the committed 
developments and 
prepare the pipeline
 ›  See more on pages 34 to 38

Drive rent  
roll growth
 › See more on pages 39 to 41

Priority

Key initiatives

 – Explore further sales 
opportunities where 
prospective returns 
are insufficient.

 – Acquire properties, should 
we see attractive value in 
the market.

2019/20 progress

 – Total sales of £73.3 million 
at an average capital value 
of £1,305 per sq ft, 10% ahead 
of book value.

 – We maintained our disciplined 
approach to acquisitions and, 
with limited value to be found, 
no properties were purchased 
during the year. 

 – Maintain programme 

of three new committed 
development schemes.

 – Capture further 

reversionary potential.

 – Reduce investment vacancy 

 – Secure further pre-lettings on 

rate below 4%.

 – Seek further opportunities to 
roll out flex space offering.

 – Deliver ERV growth of between 

-2.0% and +1.5%.

 – Rent roll up 3.0% on a like-
for-like basis. £3.9 million 
of reversion captured.

 – Vacancy rate low at 2.0%.

 – Ten flex space lettings totalling 

97,800 sq ft across four 
buildings; flex space now 11% 
of portfolio.

 – Portfolio ERV up +1.4% in year.

committed schemes.

 – Prepare the ten schemes in the 
development pipeline for the 
next cycle.

 – Submit planning applications 

at 50 Finsbury Square, EC2 and 
City Place House, EC2.

 – Good progress on three 

committed developments, 
albeit programmes delayed due 
to impact of COVID-19. 

 – Further pre-letting success 
at Hanover Square, W1 and 
1 Newman Street & 70/88 
Oxford Street, W1 and a further 
52,000 sq ft under negotiation 
at The Hickman, E1.

 – Deep development pipeline: 
ten projects, with planning 
consent submitted for 
refurbishment of 50 Finsbury 
Square, EC2.

 – Total development programme: 
56% of portfolio, 1.8 million sq ft.

Impact on 
strategic KPIs

 – Sales ahead of book value, 

lower loan to value and support 
TPR and TAR.

 – Development surpluses 
enhance TPR and TAR.

 – Pre-lettings accelerate TPR 

 – Accretive recycling and 

and mitigate voids.

reinvestment should enhance 
TPR and TSR.

 › See more on our KPIs and operational 

measures on pages 18 and 19

 – Extensive pipeline of 

development opportunities 
can support TSR.

 › See more on our KPIs and operational 

measures on pages 18 and 19

 – Capture of rental reversion 
and occupier retention 
supports TPR.

 – Higher ERVs support asset 
values and TPR and TAR.

 › See more on our KPIs and operational 

measures on pages 18 and 19

30

Great Portland Estates  Annual Report 2020

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Near-term strategic priorities 2020/21

Priority

Key initiatives

COVID-19  
response
 › See more on pages 49 and 58 to 62

Deliver  
and lease the  
committed schemes
 › See more on pages 34 and 35

Prepare  
the pipeline
 › See more on pages 36 to 38

 – Prioritise the safety and 
wellbeing of occupiers, 
suppliers and employees. 

 – Maintain cash flow whilst 

supporting occupiers who are 
facing economic hardship. 

 – Complete construction of 

The Hickman, E1 and Hanover 
Square, W1 on time and budget.

 – Achieve vacant possession and 
commence refurbishment of 
50 Finsbury Square, EC2. 

 – Maintain programme for 
the completion of Oxford 
House, W1.

 – Secure planning consent for 

City Place House, EC2 and New 
City Court, SE1.

 – Provide business continuity 

 – Maximise pre-letting of the 

 – Formalise the development 

for our occupiers by keeping 
occupied portfolio operational.

 – Scenario planning and stress 
testing the Group’s resilience.

 – Monitor acquisition 

opportunities.

remaining space.

 – Complete sale of blocks B & C 

at The Hickman, E1. 

strategy with key stakeholders 
at Mount Royal, W1 and submit 
planning application.

 – Finalise development plans for 
Piccadilly Estate, W1, Kingsland 
& Carrington House, W1 and 
Minerva House, SE1.

Priority

Progress sustainability 
agenda
 › See more on pages 72 and 77

Further embed 
our values
 › See more on pages 46 and 53

Continue to grow 
our flex offer
 › See more on pages 12, 13 and 41

Key initiatives

 – Promote and communicate 
our Statement of Intent. 

 – Finalise roadmap to zero 

carbon business.

 – Broaden employee 

education programme.

 – Meet KPIs embedded in  

ESG-linked RCF.

 – Deliver follow-up actions from 
pulse survey and values based 
leadership training.

 – Achieve National 

Equality Standard. 

 – Evaluate additional 152,200 sq ft 

of space for flex offerings.

 – Further expand offer with 
successful launch of Flex+ 
space at Dufours Place, W1.

 – Further progress inclusion and 

 – Utilise economies of scale 

diversity initiatives.

 – Maintain positive health 

and safety culture.

for fit-out procurement and 
service delivery.

 – Broaden marketing initiatives.

Annual Report 2020  Great Portland Estates 31

 
 
 
 
Our investment activities

2019/20 Strategic Priority:
Further recycling and selective 
investment activity

Operational measures

Purchases
Sales
Sales – premium/(discount) 
to book value1
Sales – capital value per sq ft
Total investment transactions2
Net investment3

2020
£nil

2019
£nil
£73.3m £348.9m

10.0%
(0.7)%
£1,305
£1,459
£73.3m £348.9m
£(73.3)m £(348.9)m

1.  Based on book values at start of financial year.
2.  Purchases plus sales.
3.  Purchases less sales. 

Our approach 

Buying at the right price and selling at the right time 
is central to our business model. Using our extensive 
network of market contacts, our investment team 
pursues a disciplined approach with clearly defined 
acquisition criteria.
 › See more on page 16 

Once we have acquired a property, the investment 
team works closely with our portfolio management and 
development teams to deliver the business plan and 
maximise the property’s potential. Every asset’s business 
plan is updated quarterly, providing estimates of forward 
look returns under different market scenarios. These plans 
also help to inform our sales activities, with the assets 
providing the lower risk adjusted returns often being 
sold and the proceeds recycled into better performing 
opportunities or returned to shareholders. 

Prior to the arrival of COVID-19, the 
decisive outcome of the general election 
briefly improved investor sentiment and 
lifted transaction activity in our investment 
markets. This renewed confidence resulted 
in a flurry of transactions completing in 
the last two weeks of 2019.”

Robin Matthews
Investment Director

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Great Portland Estates  Annual Report 2020

During the year we saw strong demand for long-let, 
well-located prime assets as well as for sites with 
near-term development potential. Accordingly, value 
has been scarce and we made no acquisitions during 
the year. However, we took advantage of these 
market conditions to profitably recycle out of one 
commercial property.

Given the continued strength of the investment market, 
attractive opportunities to buy were limited and we were 
once again a net seller, taking advantage of these supportive 
market conditions to sell 24/25 Britton Street, EC1. In total, 
together with some small residential sales, we generated 
£73.3 million in gross proceeds at a 10.0% premium to the 
31 March 2019 book values.

Sales for the year ended 31 March 2020

Commercial
24/25 Britton Street, EC1
Commercial total
Residential
78/92 Great Portland 
Street, W1
Rathbone Square, W1
Total

Premium/
(discount)
to book 
value %

Price1
£m

Price per
sq ft
£

NIY 
%

64.1
64.1

11.8
11.8

1,245 4.07%
1,245 4.07%

3.6
5.6
73.3

(3.7)
0.0
10.0

n/a
1,632
2,219
n/a
1,305 4.07%

1.  After deductions for tenant incentives.

Last year, we entered into a structured sale agreement for our 
small Whitechapel Courtyard sites at the rear of our Hickman 
development. We expect the sale to conclude prior to 
completion of the main development in Q3 2020.

Residential sales of £9.2 million
During the year we completed £9.2 million of residential sales, 
including the last remaining unit at Rathbone Square, W1 for 
£5.6 million, in line with the March 2019 book value. GPE has 
no remaining interest in the asset.

New PropTech VC investment
PropTech is having a growing impact on the markets in 
which we operate both as technology becomes increasingly 
embedded in buildings and as the services that surround 
our buildings become digitised. Therefore, whilst we saw 
limited opportunities in the investment market, we made a 
commitment in January 2020 of up to £5 million to invest in Pi 
Labs European PropTech venture capital fund. Launched in 
2014, Pi Labs is Europe’s longest standing PropTech VC and 
this third fund has a primary focus to invest in early stage 
PropTech start-ups across Europe and the UK that use 
technology solutions to enhance any stage of the real estate 
value chain. 

Investment in the fund will provide us with an insight 
into emerging technologies and provide the ability to 
trial them in the portfolio. Key areas of focus for the fund 
include sustainability, the future of work, the future of retail, 
commercial real estate technologies, construction technology 
and smart cities. 

How we are positioned
We have been a net seller for the past seven financial years, 
taking advantage of supportive investment markets to 
recycle out of mature assets where our business plans were 
complete. However, we are constantly reviewing acquisition 
opportunities, and we currently have £0.9 billion of potential 
acquisitions under review.

Value of deals under review by GPE £bn

1.6

1.2

May ’10
39%

0.8

Nov ’09
48%

Nov ’10
48%

0.4

Dec ’17
4%

May ’18
0%

Nov ’19
7%

Nov ’18
15%

May ‘20
0%

May ’17
0%

May ’19
9%

‘08

‘09

‘10

‘11

‘12

‘13

‘14

‘15

‘16

‘17

‘18

‘19 ‘20

Percentage of reviewed stock trading near ‘fair value’

Value of deals under review £bn

Source: GPE

Whilst the number of assets under review remains high, 
opportunities providing attractive value continued to be 
scarce. Those with a near-term development opportunity, 
the sort of assets that we typically look to buy, saw strong 
demand and pricing was robust. None of the assets we 
reviewed traded within 10% of our view of fair value. 

In the near term, we expect COVID-19 to greatly reduce the 
number of assets for sale. So far, levels of financial distress 
appear to be low and therefore vendors do not need to bring 
assets to an increasingly uncertain market. Looking further 
ahead, it is too early to ascertain what impact the pandemic 
and economic shutdown will have on the investment market. 
We will remain disciplined. Any potential purchase needs 
to outperform the assets we already own, and with our 
existing portfolio stacked with opportunity, the hurdle is high. 
However, we continue to closely monitor the market and we 
have both the financial firepower and the team to exploit any 
market weakness should it arise.

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11.8%

Commercial sales above book value in 
the year

24/25 Britton Street, EC1

Good returns
Recycling out of mature assets

We comprehensively refurbished the office element of the building 
in 2011 and subsequently let the space to Kurt Geiger. Situated in the 
heart of Clerkenwell, in close proximity to the Farringdon Crossrail 
station, the refurbished building provided 49,900 sq ft of high quality 
accommodation arranged over two lower ground, ground and 
three upper floors as well as two retail units fronting Britton Street 
(1,500 sq ft).

Last year, we re-geared the lease with Kurt Geiger, extending 
their term to 2035 and increasing the overall rent to £55 per sq 
ft, an 80% increase post refurbishment. Securing this long-term 
income, combined with a minimum rental uplift on review, created 
a highly desirable investment opportunity.

With our business plan complete, we sold 24/25 Britton Street, EC1, 
in January 2020 to an overseas investor for a headline sale price of 
£64.50 million, equating to £64.06 million after deduction of vendor 
top ups. The headline price reflects a net initial yield of 4.07% and 
a capital value of £1,255 per sq ft. The premium to the March 2019 
valuation was 11.8% and the sale crystallised an ungeared IRR of 15.7% 
p.a. since the office element was refurbished in 2011.

Annual Report 2020  Great Portland Estates 33

 
 
 
 
Our development activities

2019/20 Strategic Priority:
Progress the committed 
developments and prepare 
the pipeline

Operational measures

Profit on cost1
Ungeared IRR1
Yield on cost1
Income already secured1
BREEAM Excellent (targeted)1
Committed capital expenditure 
to come

2020
14.7%
9.2%
4.8%
23.4%
100%

2019
19.1%
10.8%
4.8%
21.3%
100%

£66.1m £139.5m

1.  Committed developments at date of report. 

Our approach 

Upgrading our portfolio through development, using 
targeted capital expenditure, creates sustainable 
spaces with improved occupier appeal and longevity 
which enhances both rental values and capital returns. 
The cyclical nature of central London property markets 
means it is critical for us to match this development 
activity to the appropriate point in the cycle, delivering 
new buildings into a supportive market when quality 
space is scarce and demand is resilient. By combining 
our forensic analysis of market conditions with our active 
portfolio management, we aim to be opportunistic and 
flexible when planning the start and completion dates 
for our schemes. 

We have a good track record of matching our activities 
to the ebb and flow of London’s cyclical market and today 
we have three committed schemes and a substantial 
pipeline of opportunities. As a result, the successful 
delivery and preparation of the development programme 
are key near-term strategic priorities.

We have made good progress on our six 
committed and near-term development 
schemes over the past 12 months. 
With two completions expected this year, 
our talented team are busy preparing 
the next wave of exciting schemes that 
will provide us with value-creating 
opportunities into the coming decade.”

Andrew White
Development Director

34

Great Portland Estates  Annual Report 2020

We have made significant progress with our three 
committed schemes, which are now 48% pre-let or 
under offer. We continue to prepare our pipeline 
of future opportunities, with three schemes now 
in our near-term pipeline. Our total development 
programme represents 56% of the entire portfolio 
providing us with an extensive platform of future 
opportunities to add value.

We currently have three committed schemes on site, set to 
deliver 414,600 sq ft of high quality space, all near Crossrail 
stations and all targeting BREEAM ‘Excellent’, which are 
expected to generate a profit on cost of 14.7%. With two 
schemes due to finish this year, capital expenditure to come 
at these schemes totals £59.9 million and, at 31 March 2020, 
the committed development properties were valued at 
£590.3 million (our share). 

Our ability to deliver sustainable development returns 
requires a deep pipeline of opportunities, which, when 
conditions allow, will become the development schemes 
of tomorrow. Today, our pipeline of future schemes is as 
rich as ever, with the team busy preparing a further ten 
schemes set to deliver more than 1.4 million sq ft across 
the coming decade.
 › See our case study on page 38

Committed schemes 48% pre-let or under offer; 
two completions expected this year
Hanover Square, W1, our 221,100 sq ft mixed-use 
development in Mayfair, will deliver 167,100 sq ft of offices, 
41,800 sq ft of retail and restaurant space and 12,200 sq ft of 
residential apartments. Construction has progressed well in 
the year although the recent lockdown associated with the 
COVID-19 pandemic has understandably required social 
distancing on site and will delay completion, marginally 
increasing costs to complete. Based on current working 
patterns, we expect the scheme to complete in sections 
over the coming months with full practical completion 
now expected in October 2020.

Following strong office pre-letting to KKR and Glencore, 
interest in the remaining 55,700 sq ft of office space continues 
to be strong, especially for the standalone office building on 
New Bond Street, W1 where we currently have 32,900 sq ft 
of office space under offer.

During the year, we pre-let a 5,000 sq ft retail unit on the 
corner of New Bond Street and Brook Street to Canali, 11.5% 
ahead of the March 2019 ERV and we handed the unit over 
to them in April 2020. We expect the letting prospects for 
the remaining five retail units to be more challenging given 
the current impact of COVID-19 on retail activity. However, 
we remain optimistic on their leasing prospects. The units 
are located on one of the world’s premier retail streets, with 
attractive relative pricing and a unit sizing that is appropriate 
to their target market. 

Hanover Square is now 52% pre-let with £7.2 million of rent 
secured and when completed it is expected to deliver a 
profit on cost of 20.9%. The development is owned in the 
GHS Partnership, our 50:50 joint venture with the Hong 
Kong Monetary Authority.

At Oxford House, now branded 1 Newman Street & 70/88 
Oxford Street, W1, we have made good progress and 
the structure of the building is complete to level seven. 
1 Newman Street & 70/88 Oxford Street will deliver 81,200 
sq ft of new offices and 37,900 sq ft of retail space at the 
rapidly improving eastern end of Oxford Street, directly 
opposite the entrance to the Tottenham Court Road Crossrail 
station. We have commenced the marketing of the retail 
units although, again, we expect leasing progress to be 
slow given the impact of COVID-19 along with delays to the 
opening of Crossrail. Occupier interest for the office space 
however has been strong, given the quality of the building 
and the continued lack of new-build office supply in the core 
of the West End. As a result, we have pre-let the top three 
floors (39,970 sq ft) to Exane the European equities business 
and interest in the remainder is encouraging. Completion is 
now anticipated to be in Q3 2021 as a consequence of the 
lockdown, with an expected profit on cost (excluding the 
benefit of the pre-let) of 8.0%. 

At The Hickman, E1, we are expecting to complete the 
development in August 2020. Our activities have transformed 
the existing building into 74,400 sq ft of Grade A office 
and retail space. The Hickman will be our most intelligent 
building to date. We are pioneering our integrated building 
app ‘sesame’, which will provide us and our occupiers with 
real-time data on occupancy, energy consumption, air quality, 
lighting and temperature, providing a better understanding 
of how the building is operating and being utilised. 

Occupier interest in the seven storey building has been 
strong. To date, we have the top four floors (28,700 sq ft) 
under offer on a ten-year term at an average rent of £60.00 
per sq ft, marginally ahead of the March 2020 ERV.

We expect to fit-out the second floor and lease the space 
on a Flex basis and provide co-working space on the lower 
ground, ground and first floors. By layering our flex space 
between the co-working and the core traditional spaces on 
the upper floors, we are creating a truly flexible building. 
We are aiming to provide the ability for occupiers of the 
co-working space, typically on the shortest commitments, 
to potentially graduate further up the building as their 
businesses mature. But equally, and of more immediate 
value, the core occupiers who take longer commitments 
can do so knowing that they can expand down into the co-
working space as required. This, and the additional amenity, 
is designed to make the core space more attractive – proven 
by the fact that space we have under offer is at a premium to 
ERV. We are targeting a profit on cost of 16.8%.

Together, our three committed developments require 
£59.9 million of capital expenditure to complete, along with a 
further £6.2 million for our current refurbishments. Given the 
wider disruption as a result of COVID-19, we remain close to 
our contractors to ensure our sites are operating safely within 
current government guidelines. As these guidelines evolve, 
our forecast completion dates may change, however our 
earliest long-stop date under our existing pre-let agreements 
is not until June 2022. We also continue to closely monitor the 
financial position of our contractors whilst maintaining their 
cash flow through our usual bi-monthly payment terms. 

Overall, our three schemes, which are all targeting a BREEAM 
‘Excellent‘ rating, are 48% pre-let or under offer and are 
expected to deliver a profit on cost of 14.7%, a yield on cost of 
4.8% and an ungeared IRR of 9.2%. 

Our committed schemes – 
414,600 sq ft

1 Newman Street & 70/88 Oxford Street, W1

Size 

Construction cost 

Expected completion date 

BREEAM target 

Crossrail station 

119,100 sq ft

£103.5m

Q3 2021

Excellent

30 metres1

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Hanover Square, W1

Size 

Construction cost 

Expected completion date 

BREEAM target 

Crossrail station 

221,100 sq ft

£121.3m2

Q4 2020

Excellent

0 metres1

The Hickman, E1

Size 

Construction cost 

Expected completion date 

BREEAM target 

Crossrail station 

1.  Distance to nearest Crossrail station.
2.  At GPE share through our GHS Partnership.

74,400 sq ft

£31.7m

Q3 2020

Excellent

650 metres1

Annual Report 2020  Great Portland Estates 35

 
 
 
 
Our development activities continued

1 Newman Street &  
70/88 Oxford Street, W1

Sought after
The last piece of the puzzle

1 Newman Street & 70/88 Oxford Street, W1 is situated at 
the eastern end of Oxford Street opposite the Tottenham 
Court Road Crossrail station. Once completed in Q3 2021, 
the building will provide 119,100 sq ft of new Grade A 
space comprising 81,200 sq ft of offices and 37,900 sq ft of 
retail units.

We have had considerable success at this end of Oxford 
Street, with 1 Newman Street & 70/88 Oxford Street 
our third significant development and the final piece of 
the puzzle. 

Our activities, along with the forthcoming opening 
of Crossrail in 2021, have helped revitalise a part of 
London that had previously suffered from significant 
underinvestment. This transformation has also encouraged 
a number of well established businesses to relocate to 
the area. We have completed significant office pre-lets to 
Facebook and Moneysupermarket (at Rathbone Square and 
1 Dean Street respectively), along with retail pre-lettings to 
Benetton and New Look. 

High quality buildings remain in short supply, and in May 
2020 we were pleased to announce that Exane, the European 
equities business, had pre-let the top three office floors 
of the building (39,970 sq ft), taking a 15-year lease at an 
average rent of £100 per sq ft, 14 months before completion. 
The development is progressing well and we look forward to 
welcoming Exane to their new home later next year.

36

Great Portland Estates  Annual Report 2020

Rathbone Square, W1  
Pre-let to Facebook 
NIA: 242,800 sq ft 
15-year lease (no breaks)

1 Dean Street, W1  
Pre-let to Moneysupermarket, 
Benetton and New Look 
NIA: 90,700 sq ft 
15- and 10-year terms

1 Newman Street & 70/88 
Oxford Street, W1  
Pre-let to Exane 
NIA: 39,970 sq ft 
15-year lease 
Completion: Q3 2022

Our near-term schemes – 821,600 sq ft

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City Place House, EC2*

50 Finsbury Square, EC2

New City Court, SE1*

Proposed size 

Earliest start 

Opportunity area 

320,000 sq ft

Proposed size 

129,100 sq ft

Proposed size 

2022

Earliest start 

2021

Earliest start 

372,500 sq ft

2022

Crossrail

Opportunity area 

Crossrail

Opportunity area 

London Bridge

*  Computer Generated Image.

Three near-term schemes
Beyond our three committed schemes, we have a substantial 
and flexible pipeline of ten uncommitted schemes, including 
three schemes in our near-term pipeline.

At 50 Finsbury Square, EC2, we have submitted a 
planning application for a major refurbishment and have 
completed the surrender agreement with Bloomberg L.P. 
ahead of securing vacant possession. The 129,100 sq ft major 
refurbishment will see the office floor plates extended within 
the existing frame of the building, a large reception with a 
concierge as well as an improved amenity offer. We now 
expect to commence construction in early 2021.

Close by at City Place House, EC2, located 200m from the 
Moorgate Crossrail station, we are working on plans to 
maximise the potential of the site by significantly increasing 
the size of the building to 320,000 sq ft, up from 176,600 sq ft 
today. Initial discussions with the City of London have been 
encouraging and the project has a proposed start date in 
2022. We expect to submit a planning application in Q3 2020.

At New City Court, SE1 in the London Bridge Quarter, we 
have submitted a planning application to materially increase 
the size of the existing 98,000 sq ft building to 372,500 sq ft 
and we expect a determination later this year.

Subject to planning, these three schemes could together 
deliver 821,600 sq ft of Grade A space, and have an expected 
capital expenditure of c.£600 million and an expected 
ERV of c.£55 million. Encouragingly, we have already had 
pre-let discussions for space across these three schemes 
with a number of potential occupiers, despite having yet 
to secure planning permission.

Designing climate change resilient 
and adaptable spaces
Our development activities form a significant part of our 
carbon footprint and it is clear that sustainability, wellbeing 
and community relationships continue to move up the 
agenda of our key stakeholders. Accordingly the climate 
change resilience of our developments forms a key part of our 
Sustainability Statement of Intent ‘The Time is Now’. As part 
of this commitment we have also pledged to decarbonise our 
business by 2030 and committed to ensuring that all our new 
buildings are net zero carbon from 2030. 

Our Sustainable Development Brief helps ensure that our 
schemes anticipate future sustainability requirements and 
are resilient to climate risk. Furthermore, our Design Review 
Panel, chaired by our Director of Workplace and Innovation, 
meets weekly and challenges our professional teams to 
ensure that we create space that fulfils our occupiers’ needs. 
In particular, this means ensuring our developments meet 
the highest standards of sustainable design, embrace 
technology and provide a variety of adaptable and 
flexible working environments.
 › See more on pages 72 to 77

56%

Of portfolio in development programme

Annual Report 2020  Great Portland Estates 37

 
 
 
 
Our development activities continued

Our pipeline of opportunity
How we are positioned
In addition to our six committed and near-term 
development schemes, our medium-term pipeline consists 
of a further seven schemes stacked full of opportunity. 
Providing us with a strong platform for organic growth and 
a wealth of value-creating opportunities, all of the schemes 
are currently income producing, are well located around 
major public transport interchanges in the heart of London 
and have flexible start dates.

Today, our total development programme is substantial, 
encompassing 56% of the portfolio which is set to provide 
in excess of 1.8 million sq ft of modern, high quality, 
sustainable space for London to thrive.

35 Portman Square, W1

Jermyn Street Estate, SW1

Proposed size 

Earliest start 

72,800 sq ft1

Proposed size 

2026

Earliest start 

Opportunity area 

Core West End

Opportunity area 

133,200 sq ft1

2021/22

Core West End

French Railways House and  
50 Jermyn Street, SW1

Kingsland/Carrington House, 
W1

Proposed size 

Earliest start 

90,000 sq ft

Proposed size 

2022

Earliest start 

Opportunity area 

Core West End

Opportunity area 

53,500 sq ft

2022/23

Prime retail

Mount Royal, W1

Minerva House, SE1

95/96 New Bond Street, W1

Proposed size 

Earliest start 

92,100 sq ft1

Proposed size 

130,000 sq ft

Proposed size 

2022/23

Earliest start 

2022

Earliest start 

Opportunity area 

Core West End

Opportunity area 

London Bridge

Opportunity area 

9,600 sq ft1

2023/24

Prime retail

1.  Existing area.

38

Great Portland Estates  Annual Report 2020

Our leasing activities

2019/20 Strategic Priority:
Drive rent roll growth

Operational measures

New lettings and renewals
Premium to ERV1 (market lettings)
Vacancy rate
ERV growth
Reversionary potential
Rent collected within seven days2

1.  ERV at beginning of financial year.
2.  For March quarter.

Our approach

2020

2019
£14.4m £24.5m
6.9%
4.8%
1.2%
8.3%
99.2%

8.8%
2.0%
1.4%
11.7%
62.9%

We consider that a close relationship with our occupiers is 
vital to our success. As a result, we manage all aspects of 
our property portfolio in-house, enabling us to continually 
refine our understanding of what occupiers want and how 
we can meet their needs. We aim to deliver a premium 
experience, through our high quality teams, the energised 
spaces we provide and high levels of customer service, all 
supported by technology. Our portfolio managers also 
work closely with our development team to ensure that 
vacant possession is achieved on a timely basis, ahead 
of key development starts, wherever possible relocating 
occupiers to other buildings within our portfolio. 

Our portfolio managers, supported by our occupier 
services team, administer a portfolio of approximately 
332 occupiers, from a diverse range of industries, in 44 
buildings across 33 sites. This diversity limits our exposure 
to any one occupier or sector, with our 20 largest 
occupiers at 31 March 2020 accounting for 36.4% 
(2019: 39.8%) of our rent roll. 

We have had another year of strong operational 
activity, reporting healthy leasing ahead of ERV 
and continuing the successful roll-out of our flexible 
space offering. We completed 46 new lettings, 
securing £14.4 million of rent, outperforming March 
2019 ERVs by 8.8%. We also settled 29 rent reviews 
securing £13.2 million of rent.

Despite the economic and political turbulence our 
occupational markets continued to perform well. Demand for 
our brand of high quality, sustainable space remained robust, 
supporting our successful leasing activity. During the year, 
we delivered market lettings 8.8% ahead of ERV and overall 
rental value growth of 1.4%. We also continued to capture 
reversion across the portfolio, and coupled with the leasing 
activity, this helped drive like-for-like Group rent roll up 
by 3.0%.

The key highlights of another busy year included:

 – 46 new leases and renewals completed during the year 
(2019: 78 leases) generating annual rent of £14.4 million 
(our share: £12.7 million; 2019: £19.3 million), with market 
lettings 8.8% ahead of ERV;

 – ten Flex space and co-working lettings (97,800 sq ft), 
securing rent at a premium of 42% to net effective 
ERV, and currently appraising a further 152,200 sq ft;

 – 29 rent reviews securing £13.2 million of rent (our share: 
£12.2 million; 2019: £10.5 million) were settled at an 
increase of 19.7% over the previous rent and capturing 
significant reversion;

 – £3.9 million of reversion captured in the year to 

31 March 2020 (2019: £2.7 million);

 – total space covered by new lettings, reviews and 
renewals was 439,200 sq ft (2019: 600,400 sq ft); 

 – following the successful leasing period, the Group’s 

vacancy rate has decreased to 2.0% (31 March 2019: 4.8%) 
and Group rent roll has increased by 3.0% to £100.8 million, 
on a like-for-like basis; and

 – our average office rent remains low at £53.40 per sq ft.

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We are continually refining our 
understanding of what our occupiers want 
and how we evolve to meet their needs. 
The expansion of both our flexible space 
offering and our new innovative app, 
‘sesame’, enhance the level of service we 
are delivering to our occupiers.”

Steven Mew 
Portfolio Director

8.8%

Premium to ERV on market lettings

Annual Report 2020  Great Portland Estates 39

 
 
 
 
Our leasing activities continued

A highly active year
Whilst we have been successful with further pre-lettings at 
our committed developments (see development activities 
section), we have been highly active across our investment 
portfolio including the expansion of our flexible spaces.

During the year, we significantly extended our commitment 
to our flexible offerings. After the success of our co-working 
arrangement with Runway East at New City Court, SE1, we 
expanded our co-working arrangement with a new flexible 
office partnership arrangement with Knotel for 82,300 sq ft at 
City Place House, EC2. Knotel is a flexible workspace provider 
and will operate the space until the building’s redevelopment 
and together we will share the revenue generated from the 
businesses in occupation. 

Our partnership arrangements to date have focused on 
income protection ahead of redevelopment. However, 
looking forward we are appraising longer-term arrangements, 
designed to enhance the income by utilising co-working 
partnerships to enliven the building arrival experience, 
provide expansion space for the other occupiers and 
act as a portfolio incubator for smaller businesses.
 › See our development activities on pages 34 to 38

In addition, as our Flex product evolves, we have committed 
16,300 sq ft to our new Flex+ space at Dufours Place, W1. 
This new Flex+ space further enhances our current Flex 
product and provides occupiers with added service provision 
as well as communal facilities such as a courtyard and ground 
floor café. Over the past twelve months, our flexible office 
space has increased from 87,600 sq ft to 219,600 sq ft, or 11% 
of our office portfolio, and we are also currently appraising a 
further 152,200 sq ft of flexible space across the portfolio.

In the investment portfolio, our completed development 
at 160 Old Street, EC1 is fully let following the letting of 
the two remaining office floors and the final two retail units. 
Together these totalled 15,200 sq ft of space for a combined 
rent of £1.1 million, 10.4% above March 2019 ERV. 

At 50 Finsbury Square, EC2, we agreed a lease surrender 
with our largest occupier Bloomberg L.P. ahead of their 
forthcoming lease expiry in June 2020. Bloomberg L.P. 
paid £11.5 million, including dilapidations and a surrender 
premium. We will obtain full vacant possession in late 
2020 to allow for a major refurbishment of the building.
 › See our development activities on page 37

Our flexible offerings

Type of space

Flex
Flex+
Partnerships
Total

40

Great Portland Estates  Annual Report 2020

Lettings and rent reviews by quarter 2019/20 £m

18

15

12

9

6

3

0

9.4

7.2

2.3

2.7

Q1
Lettings

Q2
Rent reviews

0.3

3.7

Q3

1.2

0.8
Q4

During the year, we continued to see our office portfolio 
outperform our retail portfolio with our office property rental 
values increasing by 3.5% compared to a 4.3% fall in retail 
rental values, as weaker retailer sentiment continued.

We have 13 lettings under offer accounting for £12.3 million 
p.a. of rent (our share: £10.0 million), together 2.5% ahead 
of 31 March 2020 ERV. 

Capturing reversion through rent reviews
Of the reversion that could be captured this financial year, 
a large proportion was available through rent review. As a 
result, it was essential that we successfully settled these 
reviews. We had another busy year, settling 29 rent reviews 
(159,300 sq ft), capturing £3.9 million of reversion, 19.7% ahead 
of the previous passing rent and at a 1.5% premium to ERV. 

Significant rent review transactions included:

 – at Carrington House, 126/130 Regent Street, W1, we settled 
a rent review with Russell & Bromley Limited, increasing 
the annual rent to £1.0 million, an increase of 103% on 
the previous passing rent and 30% above ERV at the 
review date;

 – at 95/96 New Bond Street, W1, we settled a rent review 
with Victorinox Retail (UK) Limited (£550 psf Zone A), 
increasing the annual rent by £0.4 million to £1.25 million, 
an increase of 42% on the previous rent; and

 – at Wells & More, 45 Mortimer Street, W1, we settled 

eight rent reviews with New Look, capturing reversion 
of £0.5 million, and increasing the combined annual 
rent to £4.3 million, an increase of 14% on the previous 
passing rent.

Completed 
(sq ft)

Committed  
(sq ft)

Appraising  
(sq ft)

Total  
(sq ft)

56,600
–
130,700
187,300

16,000
16,300
–
32,300

136,200

225,100

16,000
152,200

146,700
371,800

Supporting our occupiers through COVID-19
Our occupiers are important stakeholders in our business 
and we have implemented measures to help support them 
through these unprecedented times. We recognise that the 
retail, leisure and hospitality sectors, 34% of our portfolio by 
rent roll (including office occupiers), have been hardest hit by 
the economic impact of restrictions on movement. This was 
reflected in the rent we collected within seven days falling to 
62.9% for the March quarter (December: 99%). Accordingly, 
we have been in discussions with our occupiers who are 
facing cash flow difficulties to accommodate requests for 
rental concessions, including monthly payment terms, rent 
deferrals and in some cases rental holidays. Where possible, 
we have also drawn on existing occupier rental deposits.

Rent concessions agreed as a % of March quarter rent

6%

3%

9%

11%

Paid
Deferred payments
Rent deposit
Rent holiday
Monthly payments

71%

We will be reviewing these concessions at regular intervals 
and welcome the significant support the Government has 
provided to assist businesses in these sectors during this 
extremely difficult period.

How we are positioned
Whilst the dynamics of the occupational office market prior 
to the pandemic were healthy, particularly for high quality 
space, the outlook is now more uncertain. Prospects for the 
forthcoming year are likely to be dominated by how long the 
current lockdown and associated disruption lasts and how 
quickly economic life can return to normal. We expect that 
well-financed, larger occupiers with lease expiries in their 
existing space will look through any near-term disruption 
to secure a long-term home for their business. However, 
more widely, we anticipate that financial disruption will 
reduce take-up levels, particularly for expansion space, 
and increase availability. 

Notwithstanding the current crisis, we are well positioned: 
our leasing record remains strong, our committed 
development programme is focused on high quality, 
well located schemes that have enduring demand, our 
average rents remain low and 92% of our portfolio is 
within walking distance of a Crossrail station. 

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Flexi time 
The right space 
at the right time

We know what occupiers want and we are evolving 
the way we provide space to meet that demand.

Occupational demand is continually evolving and 
we think that the requirements of our occupiers 
have structurally changed. One element of this is the 
popularity of serviced offices, which continues to grow.

However, as start-ups graduate into scale-ups, they are 
being hampered by the physical and cultural constraints 
of a typical serviced office. As they grow, many are 
looking for the characteristics of the serviced office in 
a space they can call their own. We believe that this 
demand will soon require most sub 10,000 sq ft space 
to be fitted out, providing a stepping-stone between 
serviced offices and traditional Cat A space.

Our portfolio is well suited to this product. With more 
than 75% of our floors sub 10,000 sq ft, we do not have 
to split floors and require customers to share facilities, and 
so our operational model does not need to drastically 
change. Crucially, the Flex product is accretive, creating 
attractive premia to traditional NPV, headline and net 
effective rents. The average length of lease for this 
space is around three years and, to date, it has typically 
taken less than a month to lease, which is quicker than 
traditional lettings, and therefore, less risky.

We think this new demand dynamic is here to stay. 
Greater expectations from occupiers has led, and will 
continue to require, more fitted and managed space. 
Accordingly, last year we launched our two flexible 
offerings, revenue share partnerships and Flex space. 
In the coming months we will extend our offering with our 
new Flex+ product which overlays service provision onto 
our already successful Flex offer. Flexible space currently 
accounts for 11% of our office portfolio and we are 
currently appraising a further 152,200 sq ft in the existing 
portfolio as well as actively targeting investment 
opportunities that lend themselves to our flexible 
space products.

Annual Report 2020  Great Portland Estates 41

 
 
 
 
Our financial results

We have delivered EPRA NAV and earnings 
growth in the year with our recent activities 
placing us in an enviable position of financial 
strength with LTV of only 14.2%.”

Nick Sanderson
Finance and Operations Director

We calculate adjusted net assets and earnings per share in 
accordance with the Best Practice Recommendations issued 
by the European Public Real Estate Association (EPRA). 
The recommendations are designed to make the financial 
statements of public real estate companies clearer and more 
comparable across Europe, enhancing the transparency and 
coherence of the sector. We consider these standard metrics 
to be the most appropriate method of reporting the value 
and performance of the business and a reconciliation to the 
IFRS numbers is included in note 9 to the accounts. We note 
that EPRA has updated its definitions of EPRA NAV and, in 
accordance with their guidance, we will adopt them in the 
forthcoming financial year.
 › See more about performance measures and EPRA metrics 

on pages 171 to 174

EPRA NAV growth driven by retained earnings 
and share buyback
At 31 March 2020, the Group’s net assets were 
£2,203.1 million, down from £2,309.7 million at 31 March 
2019 predominantly due to the £126.7 million returned to 
shareholders via a share buyback. EPRA net assets per share 
(NAV) at 31 March 2020 was 868 pence per share, an increase 
of 1.8% over the year, largely due to the marginal decline in 
value of the Group’s properties being more than offset by 
the Group’s earnings and the positive impact of the share 
buyback on a per share basis. When combined with ordinary 
dividends paid of 12.6 pence per share, this delivered a total 
accounting return of 3.2%. 

EPRA NAV pence per share

22

9

868

(1)

853

2

(13)

(4)

900

880

860

840

820

800

31 Mar 
2019
Increase

Re-
valuation

Profit on 
disposals

EPS

Ordinary 
dividend

Share 
buyback

Tax and 
other

31 Mar 
2020

Decrease

Total

The main drivers of the 15 pence per share increase 
in EPRA NAV from 31 March 2019 were:

 – the decrease of 4 pence per share arising from the 

revaluation of the property portfolio, primarily driven 
by the reduced valuation of our investment properties 
more than outweighing development surpluses;

 – profit on property disposals of 2 pence per share 

increased NAV;

 – EPRA earnings for the year of 22 pence per share 

enhanced NAV;

 – ordinary dividends paid of 13 pence per share 

reduced NAV; 

 – the completion of the share buyback programme 

enhanced NAV by 9 pence per share; and

 – other items reduced NAV by 1 pence per share.

EPRA NNNAV was 871 pence at 31 March 2020 
compared to 850 pence at 31 March 2019 (up 2.5%). 
 › See more about our capital strength on pages 78 and 79

£2.2bn 

Net assets

42

Great Portland Estates  Annual Report 2020

Higher EPRA earnings due to higher JV rents 
and lower property costs
The revaluation deficit of the Group’s investment properties, 
along with a small accounting profit on disposals, led to 
the Group’s reported IFRS profit after tax of £51.8 million 
(2019: £49.5 million). EPRA earnings were £57.0 million, 6.1% 
higher than last year predominantly due to higher rental 
income and lower finance costs in our joint ventures as a 
result of the full year impact of development completions 
and lower Group property costs due to reduced vacancy 
in the portfolio.

EPRA earnings £m

65

60

55

50

45

40

3.8

4.6

0.6

0.3

57.0

(3.9)

53.7

(0.4)

(1.7)

31 Mar 
2019

Rental 
income

Joint 
venture 
fees

Joint 
venture 
EPRA
earnings

Property 
costs

Admin 
costs

Net 
interest

Other

31 Mar 
2020

Increase

Decrease

Total

Rental income from wholly-owned properties and joint 
venture fees for the year were £79.9 million and £2.1 million 
respectively, generating a combined income of £82.0 million, 
down £2.1 million or 2.5% on last year. With rental income 
broadly stable, this reduced income was predominantly due 
to lower income from joint venture fees due to lower levels of 
transactional activity. Adjusting for acquisitions, disposals and 
transfers to and from the development programme, like-for-
like rental income (including joint ventures) increased 7.4% on 
the prior year.

EPRA earnings from joint ventures was £11.3 million, up from 
£6.7 million last year, largely due to reduced finance costs 
as a result of the repayment of the £90.0 million (our share: 
£45.0 million) bank loan in the Great Ropemaker Partnership 
(GRP) and strong leasing activity including at our recently 
completed development at 160 Old Street, EC1.

Property expenses reduced by £3.8 million to £8.1 million, 
principally due to reduced costs associated with our leasing 
initiatives and lower portfolio vacancy. Administration costs 
were £29.0 million, an increase of £3.9 million on last 
year, primarily as a result of an increase in provisions for 
performance related pay given the Group’s relative share 
price and property level performance.

Gross interest paid on our debt facilities was £10.3 million, 
£0.7 million lower than the prior year. The reduction in interest 
paid was predominantly due to reduced costs associated with 
our RCF and redemption of the Group’s convertible bond 
in the prior year more than offsetting the full year impact of 
drawing on the Group’s £100 million 2.8% private placement 
notes. Capitalised interest increased by £1.0 million to 
£5.8 million, as the cumulative cost of our committed 
developments increased as we neared completion.

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As a result, the Group had an underlying net finance 
income (including interest receivable) of £0.8 million 
(2019: £0.2 million).

Basic IFRS EPS for the year was 20.0 pence, compared to 17.9 
pence for 2019. Diluted IFRS EPS for the year was 20.0 pence 
compared to 17.1 pence for 2019. Diluted EPRA EPS was 22.0 
pence (2019: 19.4 pence), an increase of 13.4% and cash EPS 
was 17.9 pence (2019: 17.1 pence).

Results of joint ventures
The Group’s net investment in joint ventures increased 
to £647.0 million at 31 March 2020, up from £511.9 million 
in the previous year. The increase is largely due to an 
increase in partner loans to repay the bank loan in GRP and 
contributions to fund ongoing development expenditure, 
in particular for the development of Hanover Square, W1. 
Our share of joint venture net rental income was £17.9 million, 
up 14.0% from last year, as a result of increased rent from 
our letting activities and a reduction in interest payable. 
Our share of non-recourse net debt in the joint ventures was 
lower at £23.9 million at 31 March 2020 (2019: £67.4 million), 
predominantly due to the repayment of the GRP bank loan.
 › See more about our joint ventures on page 64

Strong financial position; LTV low at 14.2%
The Group’s consolidated net debt increased to £349.4 million 
at 31 March 2020, compared to £156.6 million at 31 March 
2019. The increase was due to the completion of the Group’s 
share buyback programme totalling £126.7 million in the 
year and development capital expenditure of £116.4 million 
more than offsetting receipts from the Group’s property 
sales. As a result, the Group’s gearing increased to 16.2% 
at 31 March 2020 from 6.8% at 31 March 2019. 

Including non-recourse debt in joint ventures, total net 
debt was £373.3 million (2019: £224.0 million), equivalent 
to a low loan-to-property value of 14.2% (2019: 8.7%). 
At 31 March 2020, the proportion of the Group’s total net 
debt represented by our share of joint venture debt was 
6.4%, compared to 30.1% last year. At 31 March 2020, the 
Group, including its joint ventures, had cash (£111 million) 
and undrawn committed credit facilities (£300 million) 
totalling £411 million. 

The Group’s weighted average cost of debt for the year, 
including fees and joint venture debt, was 3.0%, marginally 
lower than the prior year. The weighted average interest rate 
(excluding fees) was 2.2% at the year end, down from 2.7% 
as a result of drawing on our low cost RCF and refinancing 
the GRP bank loan. 
 › See more about our capital strength on pages 78 and 79

£411m

Cash and undrawn facilities

Annual Report 2020  Great Portland Estates 43

 
 
 
 
Our financial results continued

Debt analysis

Net debt excluding JVs (£m)
Net gearing
Total net debt including 50%  
JV non-recourse debt (£m)
Loan-to-property value
Total net gearing
Interest cover
Weighted average interest rate
Weighted average cost of debt
% of debt fixed/hedged
Cash and undrawn facilities (£m)

March  
2020

349.4
16.2%

373.3
14.2%
17.1%
n/a
2.2%
3.0%
69%
411

March  
2019

156.6
6.8%

224.0
8.7%
9.7%
n/a
2.7%
3.2%
100%
608

At 31 March 2020, 69% of the Group’s total debt (including 
non-recourse joint venture debt) was at fixed or hedged 
rates (2019: 100%). The Group is operating with substantial 
headroom over its debt covenants. At 31 March 2020, given 
our low levels of leverage, property values would have to 
fall by around 70% before covenant breach.

Rent collection for the March quarter impacted 
by COVID-19
Whilst the financial year to 31 March 2020 has not been 
materially impacted by COVID-19, we saw significantly lower 
collection rates for the first quarterly rental charge of the year 
to 31 March 2021. 62.9% of quarterly rents (quarterly rents 
represent 91% our total rent roll) were secured within seven 
working days of the 25 March quarter day (Dec 2019: 99.3%, 
Mar 2019: 99.2%). This has now risen to 71.0% and of the 
balance outstanding, more than two-thirds is due from 
sectors hardest hit by the economic impact of restrictions 
on movement being retail, leisure and hospitality occupiers. 
Accordingly, we have been in discussions with our occupiers 
who are facing cash flow difficulties to accommodate 
requests for rental concessions, including monthly payment 
terms, rent deferrals and in some cases rental holidays. 

Looking ahead, it is likely that the June quarter day collection 
rate will be lower than March, given the deteriorating 
economic backdrop combined with the current Government 
moratorium on lease forfeiture. The position could worsen 
further in the event that the Government unilaterally extends 
further new protections for occupiers beyond those already 
afforded to them under their negotiated lease contracts with 
their landlords.
 › See more about our approach to rent concessions on page 41

At 25 March, we had 9% of our rent roll on monthly payment 
terms (Dec 2019: 8%, Mar 2019: 6%). Given the ongoing 
support that we are providing to some of our occupiers 
in managing their cash flow, we expect an increase in the 
proportion of occupiers moving to monthly payment terms 
in the near term. 

Since 1 April 2019, seven of our occupiers went into 
administration, representing only 1.3% of our rent roll. 
At 31 March 2020, we held rent deposits and bank guarantees 
totalling £25.8 million, including £7.4 million for our retail, 
leisure and hospitality occupiers (of which £3.8 million, 
equivalent to 12 months rent, relates to New Look, 
our largest retail occupier). 

Within our own business, none of our employees have been 
furloughed and the Group has no current plans to access any 
UK Government COVID-19 funding.

Taxation
The tax credit in the income statement for the year is 
£0.2 million (2019: £6.6 million tax charge). The effective tax 
rate on EPRA earnings is 0% (2019: 0%). The majority of the 
Group’s income is tax free as a result of its REIT status, and 
other allowances were available to set against non-REIT 
profits. The Group complied with all relevant REIT tests 
for the year to 31 March 2020.

All entities within the Group are UK tax resident; as our 
business is located wholly in the UK, we consider this to 
be appropriate. The Group maintains an open working 
relationship with HMRC and seeks pre-clearance in respect 
of complex transactions. HMRC regards the Group as 
‘low risk’ and maintaining this status is a key objective 
of the Group. 

As a REIT, profits from our property rental business are 
exempt from UK corporation tax, provided we meet a 
number of conditions including distributing at least 90% of 
the rental income profits of this business (known as Property 
Income Distributions (PIDs)) on an annual basis. These PIDs 
are then typically treated as taxable income in the hands 
of shareholders.

The Group’s REIT exemption does not extend to either 
profits arising from the sale of trading properties or profits 
arising from the sale of investment properties in respect 
of which a major redevelopment has completed within 
the preceding three years. 

Additionally, during August 2019, HMRC published new 
guidance which states that it considers that the REIT 
exemption also does not extend to profits arising from the 
sale of investment properties which are undergoing a major 
redevelopment at the time of sale. The Group will continue to 
consider the potential effect of this guidance on any recent 
and future sales by the Group.

The Group is otherwise subject to corporation tax. 
Despite being a REIT, we are subject to a number of 
other taxes and certain sector specific charges in the 
same way as non-REIT companies. During the year, we 
incurred £5.0 million in respect of stamp taxes, section 106 
contributions, community infrastructure levies, empty rates 
in respect of vacant space, head office rates, employer’s 
national insurance and irrecoverable VAT.
 › See more about our tax strategy at:  

www.gpe.co.uk/about-us/governance

44

Great Portland Estates  Annual Report 2020

On-market share buyback programme
During the year, we completed our £200 million on-
market share buyback programme. We repurchased and 
cancelled 17.5 million shares (£125.9 million) at an average 
price of £7.19 per share (or £7.24 per share, £126.7 million 
including costs). 
 › See more on page 79

12.6p

Total ordinary dividends per share

Ordinary dividend growth
The Group operates a low and progressive ordinary dividend 
policy. The Board has declared a final dividend of 7.9 pence 
per share (2019: 7.9 pence) which will be paid, subject to 
shareholder approval, on 28 July 2020 to shareholders on 
the register on 29 May 2020. All of this final dividend will be a 
REIT PID in respect of the Group’s tax exempt property rental 
business. Together with the interim dividend of 4.7 pence, the 
total dividend for the year is 12.6 pence per share, an increase 
of 3.3% on the prior twelve months.

Ordinary dividends per share pence

12.2

12.6

11.3

13

12

11

10

9

8

7

10.1

9.0

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2016

2017

2018

2019

2020

Ordinary dividend per share

EPRA performance measures

Measure

Definition of Measure

EPRA earnings*
EPRA EPS*
Diluted EPRA EPS*
EPRA costs  
(by portfolio value)*
EPRA net assets*

EPRA NAV*

Recurring earnings from core operational activities
EPRA earnings divided by the weighted average number of shares
EPRA earnings divided by the diluted weighted average number of shares
EPRA costs (including direct vacancy costs) divided by market value 
of the portfolio
Net assets adjusted to include the valuation surplus from trading properties 
and exclude the fair value of financial instruments and deferred tax
EPRA net assets divided by the number of shares at the balance 
sheet date on a diluted basis

EPRA triple net assets* EPRA net assets amended to include the fair value of financial  

EPRA NNNAV*

EPRA NIY

EPRA ‘topped up’ NIY

EPRA vacancy rate

instruments, debt, deferred tax and tax on sale of trading properties
EPRA triple net assets divided by the number of shares 
at the balance sheet date on a diluted basis
Annualised rental income based on cash rents passing at the balance sheet 
date less non-recoverable property operating expenses, divided by the 
market value of the property increased by estimated purchasers’ costs
EPRA NIY adjusted to include rental income in rent-free periods 
(or other unexpired lease incentives)
ERV of non-development vacant space as a percentage of ERV 
of the whole portfolio 

* 

 Audited; reconciliation to IFRS numbers included in note 9 to the financial statements.

March  
2020

March  
2019

£57.0m
22.0p
22.0p

£53.7m
19.5p
19.4p

1.4%

1.4%

£2,203.1m £2,310.1m

868p

853p

£2,211.5m £2,301.5m

871p

850p

3.4%

3.3%

3.6%

5.1%

3.6%

8.6%

Annual Report 2020  Great Portland Estates 45

 
 
 
 
Our culture and people

Introduction 
Our culture is fundamental to how 
we perform. Over the past twelve 
months we have further embedded 
our Company values and underlying 
behaviours by which we measure 
these. We launched our inaugural 
Inclusion and Diversity strategy 
to build on the inclusiveness and 
openness that weaves through 
our four values, engaged with and 
supported our people through our 
ongoing commitment to wellbeing 
and we have continued to promote 
talent from within. 

Operational measures

Employee retention1
Employees 
participating in the 
Share Incentive Plan
Lateral moves 
and promotions

1.  Stability Index.

2020
2019
87% 87%

72% 72%

10

9

We achieve more together – our integrated team
Our values form the basis of our culture and how we thrive 
as a team:

 – We achieve more together

 – We are committed to excellence

 – We are open and fair

 – We embrace opportunity

As a small organisation in people terms – just over 110 
employees – our people are fundamental to the success of 
our business and every single person’s contribution counts. 
We are committed to supporting and developing our 
people to ensure that they can thrive at GPE and ensuring 
the appropriate structure and composition of our teams is 
an essential part of this. It ensures the success of individuals 
in their roles, as well as the teams’ collective ability to meet 
their potential and deliver long-term value for GPE. As such, 
we have strengthened a number of our teams over the last 
year through individual promotions, internal progression and 
by introducing new roles to develop and deepen the skill 
offering in our structures to meet evolving business needs: 

It has been fantastic to recognise so many 
promotions over the last year and to see growth 
in a number of key and evolving areas of our 
business. The new role of Head of Health and 
Safety has been important to strengthen our 
strategic delivery in this area and has become 
all the more crucial in the current climate.”

Toby Courtauld
Chief Executive

 – Sustainability and health and safety – With sustainability 
now touching everything that we do, and to recognise 
the strategic contribution of our Head of Sustainability 
in this area, Janine Cole was promoted to Director 
of Sustainability and Community in November 2019. 
To meet the demands of the coming years and our 
ambitious strategic sustainability objectives, as set out in 
our Statement of Intent (The Time is Now), we have also 
sought to strengthen the team with the appointment of an 
additional Sustainability Manager and also a new Head of 
Health and Safety to continue to ensure we maintain the 
highest standards of health and safety.

 – Occupier Services – Led by our Director of Occupier 
and Property Services, David O’Sullivan, who was also 
promoted in November having previously been Head 
of Occupier Services, we restructured what were the 
Building Management and Facilities Management teams 
into the Occupier Services and Property Services teams. 
The new structure has not only sought to reflect our focus 
on customer service delivery and the changing nature of 
the occupier environment, but also to ensure the structure 
meets the needs of our growing portfolio, in particular 
given the upcoming development completions at Hanover 
Square and The Hickman, along with our expanding flex 
space offer, whilst also providing more opportunities for 
role development and progression within the team. In the 
Occupier Services team, we were pleased to see two of our 
internal team move into Senior Occupier Services roles, and 
the promotion of our Regional Building Manager to Head 
of Occupier Services. Three new roles were also created 
in the new structure; two General Manager positions 
responsible for their flagship assets in the portfolio and one 
Estates Manager for Hanover Square, and we welcomed 
three new recruits into these positions late 2019. We have 
also recently welcomed the Head of Property Services, 
a newly created role in the Property Services team. 

 10

Lateral moves and internal promotions

46

Great Portland Estates  Annual Report 2020

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 – Building Surveyor team – Following a successful 

partnership with an external firm for the last two years, 
we have now built an internal Building Surveyor team, 
comprising one Senior Building Surveyor and two Building 
Surveyors, forming part of our Project Management 
team. We also promoted Helen Hare, our Head of Project 
Management, to Director of Project Management to 
reflect both the growth and breadth of her team, as well 
as Helen’s wider contribution to the business. 

 – Additional new roles – In addition to the above, we have 

created a new role of Head of Planning Strategy and Senior 
Development Manager to take a more holistic approach 
to managing the increasingly complex planning process 
across the portfolio. We also recruited our first Head of 
Marketing to lead our corporate and commercial marketing 
activities, a new HR Manager to continue to enhance our 
people offering and activities, and three new analysts in our 
Financial Analysis and Management Information team who 
provide valuable insight and analysis across the business. 

Our success is dependent on achieving more together, so 
when we recruit, we look for individuals who demonstrate 
that they are comfortable taking responsibility and working 
collaboratively and flexibly with colleagues and possess 
a willingness to contribute beyond their immediate roles. 
Our induction programme is comprehensive and ensures 
any new joiner can settle into their role quickly and, most 
importantly, understand our values and feel part of the 
GPE team. 

With areas of our business continuing to evolve (including 
sustainability, community, technology and flex space), 
we encourage our people to embrace change and look 
for ways to be innovative. We find ourselves in an evolving 
market which continues to present new opportunities. 
Therefore, we encourage our people at all levels to identify 
areas of improvement, innovation and ideas for the future, 
no matter how big or small, and this is emphasised through 
our employee engagement activities as well through our 
business activities, such as the development of our market-
leading app, sesame.

Our commitment to capital allocation discipline and active 
risk management remains the foundation of how we operate. 
We have a talented team who manage the portfolio, on an 
asset-by-asset basis, and our financial position to ensure 
the achievement of our strategic objectives. This often 
brings together individuals from different teams, making the 
most of the specialist skills across the business and enables 
knowledge sharing between colleagues. 

Engagement is key 
We believe that listening to and understanding our people 
and maintaining a high level of engagement across the 
business is key to motivation and productivity and ultimately 
the delivery of our business strategy. This year, we have 
focused on three keys areas to promote engagement: 
our Board Engagement Programme, our first Employee 
Pulse Survey and most recently, through GPE@Home, our 
response to the COVID-19 pandemic. 

Our culture is very open and we have 
lots of opportunity for two-way feedback, 
both formally and informally. What’s more, 
we’ve seen that feedback is listened to 
and acted upon.”

Rob Russell-Smith
Senior Portfolio Manager

Board engagement

This year, we have continued to build on our Board 
Engagement Programme to help the Board strengthen its 
understanding of employee views, to further its knowledge 
of the business and to maintain a collaborative and inclusive 
relationship with the Company in line with our culture 
and values. The Board has sought to do this over the 
years through a number of activities, including attending 
property tours with the relevant employees, holding 
informal breakfasts with the Executive Committee and 
Senior Management Team and ad hoc attendance at Team 
Away Days.
 › See more on page 103

We have built on these activities in the Board Engagement 
Programme and to do so, we have launched two 
new initiatives: 

 – ‘An audience with...’ – A twice yearly all-Company event 

hosted by a member of the GPE team with our Non-
Executive Directors on a rotational basis. While allowing 
the Board to listen to and respond to employee feedback, 
these sessions also allow employees to get to know our 
Non-Executive Directors, their roles on the Board and their 
experience and interests. Our inaugural session with Alison 
Rose corresponded with the launch of our Inclusion and 
Diversity strategy in October 2019. 

 › See more about ‘An audience with Alison Rose’ on page 53

 – Online portal – We have also set up an online portal for 
our people to submit questions to the Board. The portal 
is open at all times and we collate the questions to be 
answered at the next ‘An audience with...’ session. 

 14

New roles

Annual Report 2020  Great Portland Estates 47

 
 
 
 
Our culture and people continued

Pulse survey 

Pulse survey results %

We are always looking for opportunities to improve the 
people experience at GPE, and this year, we decided to 
move away from a formal engagement survey to more 
succinct pulse surveys as a means of seeking feedback 
more frequently from our employees, thereby allowing 
us to be more responsive. 

For consistency, and to measure overall engagement, 
we will continue to include in each pulse survey the same 
core Employee Engagement Index (EEI) questions that 
make up our overall engagement score. In addition, 
the pulse survey will look to measure the success and 
progress of specific initiatives, thereby offering a more 
flexible and agile approach to add value via the insights 
gathered and recommendations made. Our first pulse 
survey, in the autumn of 2019, focused on our values 
and behaviours, launched in February last year. 

The participation rate was extremely encouraging at 
96% of employees and the pulse survey results showed 
that overall engagement remains extremely high with 
our EEI score at 91%, up from 87% in 2017. 94% of our 
people would recommend GPE as a great place to work 
and 97% believe in what we are trying to achieve at GPE, 
compared to 89% in 2017. 

We received overwhelmingly positive feedback that 
our values are right (91%) and employees felt able to 
explain our values to others. Highlights from across 
the four values include employees:

 – feeling supported, with someone to go to if they  

need help;

 – taking pride in their contribution towards 

the success of the business;

 – knowing what is expected of them at work;

 – being treated with respect and dignity; and

 – feeling motivated to pursue opportunities 
for personal growth and development.

100

80

60

40

20

0

97% believe in what we are trying to achieve at GPE

98% take pride in their contribution towards the success of GPE

93% know what is expected of them

84% have someone to go to when they need support

86% feel they are treated with respect and dignity 

79% feel motivated to pursue opportunities for personal growth 
and development

Whilst engagement with the values is high, there is more 
to do to ensure our values drive the behaviours we expect 
to see, enabling an established best practice and ‘the GPE 
way’. Our external partners, People Lab, who conducted the 
pulse survey, have run focus groups with a wide selection of 
employees across all teams and levels to gain further insight 
into the areas for improvement and to gather employee 
views on how they can be improved. We will use that insight 
over the course of the next year to inform our employee 
engagement activities and work on specific areas arising 
from the results. 

The commitment to making GPE a great place 
to work is clear. Following the pulse survey, 
I attended a focus group to explore the areas 
of improvements and I felt empowered to 
voice my opinions and contribute to making 
a difference.”

Charlotte Ferguson
Leasing PA

94% 

97% 

Would recommend GPE as a great place to work

Believe in what we are trying to achieve at GPE

48

Great Portland Estates  Annual Report 2020

To ensure continual engagement with our employees in areas 
that we know are important to them, we have also continued 
a number of initiatives from previous years: 

 – our Bright Ideas Committee is in its second year, made 

up of 12 employees from across the business who come 
together on a monthly basis to discuss anonymous 
suggestions made by employees for improvement. 
The Committee either responds to each suggestion which 
is made publicly available on the intranet or takes specific 
proposals to the Executive Committee. Key highlights over 
the last year have been the introduction of a Staff Referral 
Scheme for introducing new candidates to GPE;

 – small informal lunches hosted by Executive Committee 
members, which all employees are invited to attend 
throughout the year; 

 – lunchtime sessions run by internal and external presenters, 

including ‘Everything you wanted to know about the 
Executive Committee’, ‘Privee app’ and ‘GPE’s approach 
to the Flex Market’; 

 – departmental lunches and Away Days – for example, our 
Portfolio Management Team ran an external Team Away 
Day, inviting the teams’ families along to enjoy the day; and

 – our second Community Day took place in September 2019. 
76% of staff participated in activities supporting our two 
charity partners, Centrepoint and Groundwork London. 

GPE@Home – responding to COVID-19 
and prolonged working from home
The COVID-19 Committee’s priority is our people’s health and 
wellbeing. As such the group is made up of representatives 
from the teams responsible for responding to the COVID-19 
pandemic and the operational, health and safety and people 
implications. Members of the Committee include the 
Finance and Operations Director, Director of Occupier and 
Property Services, Director of Sustainability and Community, 
Head of Health and Safety, Head of HR, Head of IT, 
Company Secretary and a Senior Project Manager. 

The Committee provided regular and transparent 
communication when COVID-19 started to emerge and 
restrictions were first put in place, covering Government 
updates and advice, additional Group policies and guidance 
and information from our landlords on reported cases in the 
building. Our co-ordinated approach ensured that we were 
well prepared for the whole business to work from home 
and to support our employees in making that transition, 
demonstrating our one-team ethos working at its best. 

The GPE@Home team consists of the HR team, Robin 
Matthews (Investment Director) and James Pellatt 
(Director of Workplace and Innovation). The team is focused 
on engaging with our people on four key areas: Working from 
home (protocols and policies), Wellbeing, Training and Social 
activities, and regularly communicates with the business on 
all topics. The objective of the group is to build on or adapt 
our activities in these areas to proactively support our people 
during the pandemic and prolonged working from home, 
with the aim to support all rather than taking a ‘one size fits 
all’ approach. 

The initiatives have been received positively by employees, 
and we will continue to take feedback and suggestions from 
our people to ensure the programme responds to employee 
needs as they and the situation evolve. Some of the notable 
activities are included in the table below. 

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It has been a very worrying and challenging 
time for everyone since the start of the 
COVID-19 pandemic. I feel very lucky to 
be part of a supportive and considerate 
company that really lives its values.”

Aura Kolnik
Occupier Relationship Manager

GPE@Home initiatives

Wellbeing
 – Increased flexibility for all to balance work 

and home responsibilities

 – Paid time off work for working parents/carers

 – One-to-one coaching for all (for personal 

or parental challenges)

 – Weekly virtual yoga, COVID-19  

related seminars

Training
 – Training for staff which explored the 

challenges and opportunities of working 
virtually, how to avoid common pitfalls, 
how to communicate effectively and 
how to maintain presence. 90% of 
staff attended the session

 – Training for managers on managing 

virtual teams

Working from home protocols
 – Working from home manual including health 
and safety guidance, employee wellbeing 
and IT support

 – Protocols including: regular breaks, one-hour 
meeting free a day, discouraging e-mails 
outside of working hours and on weekends, 
reducing meetings to 50 minutes

Social activities
 – Buddy groups set up to increase 

and facilitate social interaction across 
the business 

 – ‘Unlocking your inner creative potential’ 

challenge launched 

 – All employee virtual social events 

 – Use of Yammer and other internal channels 

to share stories and articles 

Annual Report 2020  Great Portland Estates 49

 
 
 
 
Our culture and people continued

Inclusion and diversity 
Inclusion is at the heart of our culture, which is grounded 
in mutual respect and non-discrimination in respect of 
age, disability, gender, race, religion, sexual orientation or 
educational background. Respecting others and showing 
consideration for other opinions helps create an environment 
where people feel they belong. Through making the most 
of our differences and experiences, we believe that we can 
really achieve more together. 

To help us promote and measure our inclusion and diversity 
activities to date, we undertook the externally moderated 
National Equality Standard assessment. Following the initial 
assessment in September 2018, we have been implementing 
a phased action plan which delivered the following:

September 
2018

National Equality 
Standard assessment 

We were delighted we achieve the National Equality Standard 
accreditation in April 2020. 

The accreditation represents a solid foundation in how we 
operate as a business and how inclusion and diversity is 
interwoven in our policies and working practices, governance 
structures and how we engage with and support our talent, 
all of which is supported by our senior management. It also 
recognises the importance of inclusion and diversity in our 
relationships with third parties and suppliers. 

Gender diversity number of people as at 31 March 2020

70

60

50

40

30

20

10

0

61

55

5

3

Board

All employees

Women

Men

24

16

12

5

Senior 
management

Middle 
management

Wellbeing

 – Launched Wellbeing 

Programme

Mental health

 – Mental health awareness 

training for all staff 
and managers

 – New Wellbeing and 
Mental Health policy

Maternity

 – Significantly improved 
maternity pay to 26 
weeks full pay

 – Maternity coaching 

for expectant mothers

Joined Real Estate 
Balance Network

National Equality 
Standard achieved

Pathways to property

 – Three-year sponsorship

Executive Committee and Senior Management Team 
direct reports as at 31 March 2020 

Executive Committee 
and their direct reports  

Senior Management Team
and their direct reports   

27%

46%

Recruitment

 – 30% female 

shortlist required

2019

Values and behaviours

 – Incorporated into 
performance and 
remuneration processes

Launched Inclusion 
and Diversity strategy 

Flexible working

 – Increased flexible working 

for all

Male 19
Female 7

Male 22
Female 19

73%

54%

The Executive Committee and their direct reports includes 
Executive Directors, other Executive Committee members, 
the Company Secretary and their direct reports comprising 
individuals whom they have direct line management 
responsibility for, excluding administrative or support roles 
(for example, personal assistants). A large proportion of the 
Executive Committee’s direct reports are members of the 
Senior Management Team.

The Senior Management Team represents the level below 
the Executive Committee comprising Directors of and 
Heads of Department, who have direct line management 
responsibility for 35% of the business. 

Launched Exec 
Com Rotating 
Seat Programme

The data includes all permanent and fixed-term 
contract employees, and is calculated on an FTE  
(full-time equivalent) basis.

April 
2020

50

Great Portland Estates  Annual Report 2020

The business case for us to do more in respect of diversity is 
clear. Not only will it strengthen our culture further and enrich 
our talent pipeline by attracting candidates and supporting 
our people so that they can thrive through achieving their 
potential, it will also allow us to confidently meet the needs 
of our increasingly diverse occupier base. Inclusion and 
diversity also align closely with our Community strategy and 
the growing investor focus on all Environmental, Social and 
Governance activities. It is important to us that our activities 
have a clear sense of direction, and to this end we launched 
our first Inclusion and Diversity strategy in the autumn of 2019. 

The strategy is built on the following five areas: 

 – Culture – further embedding our values and behaviours 

to strengthen our inclusive culture; 

 – Engagement – all employee engagement in our 

Inclusion and Diversity strategy, with senior management 
sponsorship of all activities; 

 – Employment practices, policies and procedures – 
continually reviewing working practices, policies and 
procedures to ensure they align with our approach; 

 – Internal interventions – specific initiatives relating to all 

aspects of diversity, such as recruitment and unconscious 
bias training; and

 – Our sector – contributing more widely to sector challenges 

to ensure a diverse pipeline of talent for the future. 

Our Chief Executive, Toby Courtauld, Chairman, Richard 
Mully, and Head of HR, Rachel Aylett launched the strategy at 
an all employee event alongside our inaugural ‘An audience 
with...’ session, where Nick Sanderson (Finance and 
Operations Director) hosted a Q&A session with Alison Rose 
(RBS CEO and Non-Executive Director) exploring Alison’s role 
as a Non-Executive, her view on the economy and inclusion 
and diversity. 
 › See more about ‘An audience with Alison Rose’ on page 53

Recognising our efforts and achievements in respect of 
inclusion and diversity to date, we have more to do and 
are working closely with the Board on the next phase 
of the strategy. This is likely to include a focus on:

 – increasing the diversity of the Board, Executive and 
Senior Management Team taking into consideration 
the recommendations of the Hampton-Alexander and 
Parker reviews; 

 – developing our talent pipeline at all levels, with 

support from our Board in developing our Senior 
Management Team; 

 – raising awareness across the spectrum of inclusion 

and diversity areas utilising national and international 
days and our internal communication channels;

 – reflecting our activities externally through our website, 

with the aim of increasing candidate attraction; 

 – recruiting inclusion and diversity champions from within the 

business to champion and promote initiatives; and

 – Mental Health, including Mental Health First Aider 

training for the Human Resources Team and members 
of the business (including two members of the 
Executive Committee). 

We are pleased to have achieved the National 
Equality Standard and, working closely 
with the Board, we look forward to further 
progressing the next phase of our Inclusion 
and Diversity strategy.”

Nick Sanderson
Finance and Operations Director

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Supporting employee wellbeing 
Our employees’ wellbeing remains fundamental to 
supporting our high performing culture. In 2018, we launched 
our first Wellbeing Programme, which we continue to build 
on in six-monthly instalments. This allows us to take regular 
feedback from employees and design the programme to 
proactively meet the needs of our people and respond 
to their suggestions. 

The Wellbeing Programme focuses on five key areas: physical 
health, mental health, work-life balance and supporting 
employees through their life cycles (including family and 
caring responsibilities) and financial health. We take a holistic 
approach to wellbeing so the programme has been designed 
to offer practical events, seminars and activities across the 
five areas. Some of the seminars and events will appeal to all, 
but we recognise the varying levels of support our people 
will need during their life and career and so we encourage 
people to focus on the parts of the programme most 
relevant to them. 

Weekly yoga
Pension and retirement seminars
Parenting seminars
Behavioural change seminar
Menopause awareness seminar

Wellbeing 
activities

To maximise engagement with the programme, we 
have run Wellbeing challenges such as the very successful 
Team Step Count Challenge and aligned where possible 
our wellbeing events and seminars to national and 
international days (e.g. World Health Day, Cycle to Work Day). 
Our Wellbeing Champions actively promote the Wellbeing 
Programme and events in their teams and across their peer 
group, taking feedback and proposing suggestions for 
areas to cover. 

In working with the Wellbeing Champions, 
we’ve had more insight into our people’s needs 
and interests and have designed a varied 
programme that has something for everyone.”

Katie Smith
Senior HR Advisor

Annual Report 2020  Great Portland Estates 51

 
 
 
 
Our culture and people continued

Unlocking our people’s potential 
Over the course of the year, we have invested £366,080 
in employee and Non-Executive Director training.

We have a robust annual performance review process, 
which is focused on personal development with every 
member of the business having a Personal Development 
Plan (PDP) as well as assessing achievement of specific 
objectives relating to individuals’ Roles and Responsibilities 
and GPE Values and Behaviours. We encourage everyone to 
pursue opportunities for personal growth and development. 
To support this, we design and deliver an annual Training 
Programme which responds to the specific training 
needs identified in PDPs as well as training courses to 
support the development of our values and behaviours. 
Individuals also have access to funding and support for 
external qualifications relevant to their role. 

Every year, the Executive Committee undertakes a Group-
wide Talent Development Review to ensure appropriate 
support and development opportunities are provided, 
looking for those opportunities across the Group as well as 
within teams to ensure we are maximising individuals’ growth 
potential. To further support our talented team, our senior 
managers mentor selected individuals to provide insight 
into their area of the business and assist them with their 
professional development. In addition, two of our Executive 
Committee members are also undertaking training to 
achieve coaching qualifications.

For several years, the Executive Committee members 
have participated in the 360-degree Feedback programme, 
whereby members of the HR team speak to all the Executive 
Committee members’ direct reports and peers. Feedback is 
sought for the two areas of the Performance Review process, 
Roles and Responsibilities and Values and Behaviours using 
the Stop, Start, Continue model for the second element. 
The feedback received is collated into themes, presented 
to the individual in a report and used as part of their 
annual performance review. This year, the Programme was 
extended to all Directors of and Heads of Department, 
totalling 17 people receiving in-depth qualitative feedback. 
Over the coming year, we will be working to expand this 
further and develop a stronger feedback culture across 
the whole business. 

As mentioned above, this year we launched our 
‘Exec Comm Rotating Seat Programme’ whereby two 
members of our Senior Management Team become 
Executive Committee members on a six-monthly rotation. 
The purpose of the programme is to provide development 
opportunities for our Senior Management Team by 
broadening their knowledge of the business and giving them 
an opportunity to contribute to business decisions outside 
of their area of direct responsibility, as well as improve the 
diversity of our Executive Committee by introducing new 
members and therefore new perspectives, whilst increasing 
representation from a wider range of teams. We are 
delighted with how successful the programme has been, 
with our inaugural participants of Martin Leighton (Director 
of Corporate Finance) and Helen Hare (Director of Project 
Management), due to be replaced shortly by two other 
members of the Senior Management Team.

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To strengthen team performance and collaboration, 
a number of team development days were held focusing 
on defining the team’s vision and goals for the future 
and how to work together to achieve those aims. 

Rewarding performance 

Reward and recognition are fundamental to our high 
performing culture and in living our values. All employees 
participate in the Company’s annual bonus plan, with 
a proportion of their reward driven by performance 
against personal objectives and the balance awarded by 
corporate performance against GPE’s financial targets. 
Personal objectives for every employee are split into 
two categories in the annual performance review, both 
of which have equal importance: your role and specific 
operational or project-based objectives and how you 
behave and collaborate, with each objective linked directly 
to a GPE Value. From next year, in order to fully integrate 
our values and behaviours into our reward structure and 
to proactively and positively drive the behaviours we wish 
to see, the personal bonus awards for every employee of 
GPE will be explicitly split into these two categories with 
a percentage awarded for each. 

As part of our annual remuneration review process, as well 
as reviewing every individual’s performance against their 
personal objectives and corresponding bonus awards, the 
Executive Committee and the Senior Management Team 
review salary benchmarking against market competitors, 
bonus eligibility levels, proposed promotions and Long-Term 
Incentive Plan awards. The outcome of this process is then 
presented to the Remuneration Committee. This robust 
approach ensures that every individual’s full remuneration 
package is reviewed annually by the Executive Committee 
against internal criteria and external market conditions. 

This year, the base salary increase for employees for the 
year commencing 1 April 2020 was 2%. Increases above 
2% were awarded to recognise either promotions, an 
increase in responsibility, or due to a market realignment, 
such that the average increase in base salary for the year 
commencing 1 April 2020 was 4.7%. 

I was delighted to be given the opportunity 
to sit on the Exec Comm Rotating seat 
programme. At a time when the business 
continues to evolve in line with our ever 
changing world, the programme has 
provided me with a huge level of insight 
into and involvement in a range of decisions 
and increased my knowledge enormously. 
In turn I feel I have been able to provide 
the wider GPE team with feedback and 
improved guidance on how to present to 
the Executive Committee in the future.”

Helen Hare
Director of Project Management

All employees have the opportunity to participate in the 
Company’s two-for-one Share Incentive Plan (SIP) which 
encourages people to become investors in GPE and to 
share in the Company’s financial success. Currently, 72% 
of employees participate in the scheme. Our ‘Living our 
Values awards’ recognises individual contributions more 

broadly; the scheme involves members of GPE nominating 
their colleagues to the Living our Values Committee for 
exceptionally demonstrating our values and behaviours. 
The successful awards are announced by our CEO at our 
all-staff Quarterly Review meetings and employees receive 
a retail voucher in recognition of their contributions. 

An audience 
with Alison Rose

The Board Engagement Programme
I was delighted to be part of our inaugural ‘An audience 
with…’ series in October last year and thoroughly enjoyed 
the opportunity to engage with the wider GPE team. 

We believe it is important for the Board to interact with 
all employees and have sought to do more of this in 
recent years, to ensure we are operating effectively and 
that we have the appropriate knowledge to make the 
right decisions for the Company. It is also illustrative of 
our inclusive culture and our values, the development 
of which the Board sponsored last year. 

Last year, the UK Corporate Governance Code outlined 
increased requirements for Boards to engage with 
employees. The GPE Board were wholly supportive 
of this and were unanimous in our view that we would 
all like the opportunity to be responsible for this, 
rather than nominating one Non-Executive Director. 
We therefore agreed that on a rotational basis, all the 
Non-Executive Directors would present to all employees 
in a discursive, themed format bi-annually, followed by 
a Q&A session which became the ‘An audience with…’ 
series. To facilitate these Q&A sessions we set up an online 
portal where questions could be raised anonymously 
in advance of the event. 

Nick Sanderson hosted the event which coincided with 
the launch of our inaugural Inclusion and Diversity strategy 
presented by the Chairman, Toby Courtauld, and Rachel 
Aylett, our Head of HR. 

Nick opened the session by exploring my Non-Executive 
position; specifically why I had chosen GPE and what I had 
found most surprising since joining the team, before asking 
some quickfire questions about my view on the economy, 
global risk, London’s infrastructure priorities and what the 
Government should be providing more of. We concluded 
with a fantastic discussion on inclusion and diversity where 
I was able to share my experience of our activities at RBS, 
as well as personal stories from my career including the 
importance of being authentic, learning from mistakes, 
and seeking support where needed (for example, 
through a mentor). 

Richard Mully joined me for the Q&A. As well as the pre-
submitted questions, we had many questions from the 
floor which facilitated a two-way discussion and enabled 
us to hear employee views across a range of matters. 

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We finished the event informally, with drinks and canapés 
and a chance to speak with members of the team. 

The event was attended by approximately 80% of the 
Company, which was a great turnout and employee 
feedback on the programme was positive. We look forward 
to continuing the series with Charles Philipps later this year. 

In addition to the ‘An audience with…’ series, we regularly 
attend property tours with members of the relevant teams 
and have informal breakfasts with the Executive Committee 
and Senior Management Team. More recently, in response 
to COVID-19, we have been holding regular calls with the 
Executive Directors and the rest of Executive Committee 
to share our broader experiences in responding to the crisis 
and to offer support where required. 

The event was not only a fantastic opportunity 
to hear about our Inclusion and Diversity strategy 
and to share our own views on the matter, it was 
great to get to know members of the Board. 
Alison’s candid insight into her own experience 
in a male-dominated industry was inspiring 
and relatable, and very much appreciated 
by everyone who attended.”

Alexa Baden-Powell
Investment Manager

Annual Report 2020  Great Portland Estates 53

 
 
 
 
The Board

Non-Executive Directors

Nick Sanderson 
BA (Hons), ACA 
Finance and Operations Director 

Charles Philipps
Senior Independent  
Director

Committee memberships: 
Member of the Audit, Remuneration 
and Nomination Committees

Date appointed to the Board: 
April 2014

Independent: Yes

Relevant skills and experience: 
Charles was formerly Chief 
Executive Officer of MS Amlin plc 
and a director of NatWest Markets. 
Charles’ financial qualifications and 
significant commercial and general 
management experience gained 
within the banking and insurance 
industries provide him with a good 
understanding of different points 
of view, significantly contributing to 
his ability to offer wise counsel in his 
role of Senior Independent Director.

Current external commitments: 
Chairman of the Outward 
Bound Trust.

Committee memberships: 
Member of the Executive 
Committee and Sustainability 
Committee; Chairman of the 
Health and Safety Committee

Joint Venture directorships: 
Director of the GHS Limited 
Partnership, the Great Ropemaker 
Partnership and the Great 
Victoria Partnership

Appointed to the Board: July 2011

Independent: No

Relevant skills and experience: 
Nick joined the Group in July 2011 
as Finance Director and became 
Finance and Operations Director 
in May 2019. He was formerly 
Partner, Head of Real Estate 
Corporate Finance Advisory at 
Deloitte, following ten years of 
real estate investment banking 
experience in Europe and Asia with 
Nomura, Lehman Brothers and 
UBS Investment Bank. Nick’s wide 
range of property related financial 
experience combined with strategic 
and corporate finance skills enables 
him to provide valuable support 
in developing, implementing and 
articulating the Company’s strategy, 
and taking leadership over the 
delivery of a wide range of financial 
and operational matters.

Current external commitments: 
Member of the Reporting and 
Accounting Committee of EPRA.

Chairman

Richard Mully 
BSc (Hons), MBA 
Chairman

Committee memberships: 
Chairman of the Nomination 
Committee

Date appointed to the Board: 
December 2016

Date appointed as Chairman: 
February 2019

Independent: Yes, on appointment 
as Chairman

Relevant skills and experience: 
Richard has extensive property, 
banking and private equity 
experience. This, combined with 
his Senior Independent and Non-
Executive Director experience, 
enables him to provide constructive 
leadership, challenge and support 
to the Board and wider business 
for the benefit of all stakeholders. 
Richard is currently Vice Chairman 
and member of the Supervisory 
Board of Alstria Office REIT-AG 
and was formerly founder and 
Managing Partner of Soros Real 
Estate Partners LLC, a Non-
Executive Director and Chairman 
of the Remuneration Committee 
of Standard Life Aberdeen plc and 
Senior Independent Director at ISG, 
Hansteen Holdings and St Modwen 
Properties. 

Current external commitments: 
Chairman of Arlington Business 
Parks Partnership Ltd, Vice Chairman 
of the Supervisory Board of Alstria 
Office REIT-AG and Senior Advisor 
to TPG Real Estate.

Executive Directors

Toby Courtauld
MA, MRICS 
Chief Executive 

Committee memberships: 
Chairman of the Executive 
Committee and 
Sustainability Committee

Joint Venture directorships: 
Director of the GHS Limited 
Partnership

Date appointed to the Board: 
April 2002

Independent: No

Relevant skills and experience: 
Toby has nearly three decades 
of extensive experience in real 
estate. He joined the Group in 
April 2002 as Chief Executive and 
was previously with the property 
company MEPC for 11 years where 
he gained broad experience 
ranging from portfolio management 
through to corporate transactions 
and general management as a 
member of the Group Executive 
Committee. He is past President 
of The British Property Federation. 
Toby’s significant knowledge of the 
Company and the sector enables 
him to provide broad leadership 
of the business internally and 
externally, through the successful 
design and implementation of the 
Company’s strategy, values and 
business plans and their exemplary 
communication to a wide range of 
stakeholders. 

Current external commitments: 
Member of the British Property 
Federation Board and Policy 
Committee, Director of The New 
West End Company, Non-Executive 
Director of Liv-Ex Limited, Member 
of the Council of Imperial College 
and Chairman of the White City 
Syndicate, an advisory group which 
is part of Imperial College.

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Alison Rose 
BA (Hons)  
Non-Executive Director

Nick Hampton 
MA (Hons)  
Non-Executive Director

Vicky Jarman
BEng, ACA  
Non-Executive Director

Wendy Becker
BASc, MBA  
Non-Executive Director 

Committee memberships: 
Member of the Audit, Remuneration 
and Nomination Committees

Date appointed to the Board: 
April 2018

Independent: Yes

Relevant skills and experience: 
Alison is currently Chief Executive 
Officer of The Royal Bank of 
Scotland Group plc and was 
previously Deputy Chief Executive 
Officer of NatWest Holdings and 
Chief Executive Officer of Royal Bank 
of Scotland Commercial and Private 
Banking. She has also held a number 
of other banking and finance roles 
within Royal Bank of Scotland and 
NatWest Markets. Alison’s significant 
experience of real estate financing, 
capital markets and customer 
relations through her different roles 
at Royal Bank of Scotland enables 
her to provide an informed view 
and helpful challenge to Board and 
Committee discussions.

Current external commitments: 
Chief Executive Officer of The Royal 
Bank of Scotland Group plc, Trustee 
of BITC and Chair of the Scottish 
BITC Advisory Board.

Committee memberships: 
Chairman of the Audit Committee; 
Member of the Nomination 
Committee

Date appointed to the Board: 
October 2016

Independent: Yes

Relevant skills and experience: 
Nick is currently Chief Executive 
Officer (previously Chief Financial 
Officer) of Tate & Lyle, and prior to 
this spent 20 years with PepsiCo in 
a number of financial, commercial 
and operational roles. Nick’s strong 
financial background and previous 
various operational and commercial 
roles, including formerly as Chief 
Financial Officer and currently 
as CEO of Tate & Lyle, involving 
knowledge of risk assessment 
and management systems, 
provides a strong basis for his 
effective performance as the Audit 
Committee Chair.

Current external commitments: 
Chief Executive Officer of Tate 
& Lyle.

Committee memberships: 
Member of the Audit, Remuneration 
and Nomination Committees

Date appointed to the Board: 
February 2020

Independent: Yes

Relevant skills and experience: 
Vicky is a chartered accountant who 
qualified at KPMG before spending 
over ten years with Lazard and 
Co Ltd working in the Investment 
Banking team and then as Chief 
Operating Officer for the London 
and Middle East operations until 
2009. Vicky is currently a Non-
Executive Director of Signature 
Aviation plc and Knight Frank LLP. 
She has previously been a Non-
Executive Director and Chairman 
of the Audit Committees of each of 
Equiniti Group plc, Hays plc and De 
La Rue plc and Senior Independent 
Director at Equiniti Group plc. 
Vicky’s significant financial, 
commercial and non-executive 
experience enable her to contribute 
to the strategy of the business and 
its long-term sustainable success. 

Current external commitments: 
Non-Executive Director of Signature 
Aviation plc and Knight Frank LLP. 

Committee memberships: 
Chairman of the Remuneration 
Committee; Member of the Audit1 
and Nomination Committees 

Date appointed to the Board: 
February 2017

Independent: Yes

Relevant skills and experience: 
Wendy is Chairman of Logitech 
International S.A. and a Non-
Executive Director of Sony 
Corporation and Oxford University 
Press. She was formerly a Non-
Executive Director of Whitbread 
PLC and NHS England, Chief 
Executive of Jack Wills Ltd and a 
partner of McKinsey & Company 
Inc. Wendy’s management 
consultancy skills, retail CEO 
experience and current technology 
and previous remuneration non-
executive roles provide her with a 
wealth of employee and business 
understanding and serve as a 
strong foundation for her effective 
performance as Remuneration 
Committee Chairman.

Current external commitments: 
Chairman, Logitech International 
S.A., Non-Executive Director of Sony 
Corporation and Non-Executive 
Director of Oxford University Press.

1.   Wendy will be stepping down 

from the Audit Committee from 
9 June 2020, following the signing 
of the Annual Report.

Annual Report 2020  Great Portland Estates 55

 
 
 
 
Senior Management Team

Andrew White
BSc (Hons), Dip IPF, MRICS
Development Director

Marc Wilder
BSc (Hons), MRICS
Leasing Director

Date joined the Group: 
Joined the Group in 
March 2013 as Head 
of Development. 
Appointed to the Executive 
Committee in 2015 
as Development Director. 

Experience and 
responsibilities: Formerly 
a Divisional Director at Kier 
Property and previously 
with BAA Lynton and 
Development Securities. 
Responsible for the total 
return of the development 
portfolio including the 
successful delivery of all 
development projects across 
the Group.

A member of the Group’s 
Executive Committee, the 
GHS Limited Partnership 
Operational Committee 
and a Director of the 
Great Victoria Partnership. 

Date joined the Group: 
Joined the Group in 
June 2005 as Leasing 
Manager and appointed 
Head of Leasing in 2009. 
Appointed to the Executive 
Committee in 2015 as 
Leasing Director.

Experience and 
responsibilities: 
Formerly Head of 
Leasing at Benchmark 
plc, and previously with 
Threadneedle Asset 
Management and 
Hemingway Properties 
Limited. Responsible for 
leasing across the Group’s 
investment portfolio 
and development 
programme.

A member of the Group’s 
Executive Committee.

Janine Cole
CMIOSH, PIEMA
Director of Sustainability 
and Community

Date joined the Group: 
Joined the Group in 
November 1998 as Health 
and Safety Administrator. 
Promoted to Safety, Health 
and Environmental Manager 
in 2002 and appointed Head 
of Sustainability in 2011. 
Promoted to Director in 2019.

Experience and 
responsibilities: Formerly 
a Professional Services 
Administrator with National 
Britannia. Responsible for 
sustainability and health and 
safety across the Group. 

A Board Director for the 
Better Buildings Partnership 
and a member of the British 
Property Federation, EPRA 
Sustainability Committee and 
the Design for Performance 
Advisory Board. 

Robin Matthews
MA (Hons), MSc, MRICS
Investment Director

Date joined the Group: 
Joined the Group in 
September 2016 as 
Investment Director 
and a member of the 
Executive Committee.

Experience and 
responsibilities: Formerly 
Property Director at 
Moorfield Group and 
previously with London 
& Capital Group and 
Colliers International. 
Responsible for 
overseeing the Group’s 
new investment activities.

A member of the Group’s 
Executive Committee.

David O’Sullivan
BSc, CIBSE
Director of Occupier 
and Property Services

Date joined the Group: 
Joined the Group in 
May 2018 as Head 
of Occupier Services. 
Promoted to Director 
in 2019.

Experience and 
responsibilities:  
Formerly Managing Director 
of Property Management 
EMEA at Tishman Speyer 
and previously Vice 
President of Corporate 
Services at Credit Suisse. 
Responsible for the delivery 
of Occupier and Property 
Services across the portfolio. 

Lisa Day
Head of Occupier Services

Date joined the Group: 
Joined the Group in 2005 
as a Premises Manager. 
Promoted to Regional 
Building Manager in 
December 2013 and 
then to Head of Occupier 
Services in November 2019.

Experience and 
responsibilities: Assistant 
Accommodation Manager at 
the Food Standards Agency.

Responsible for the delivery 
of Occupier Services across 
the portfolio.

James Pellatt 
BSc (Hons), MRICS
Director of Workplace 
and Innovation

Date joined the Group: 
Joined the Group in March 
2011 as Head of Projects. 
Promoted to Director of 
Workplace and Innovation 
in 2017. 

Experience and 
responsibilities: Formerly 
a Senior Director with 
Tishman Speyer and 
previously with More London 
Development and EC Harris. 
Responsible for overseeing 
the Group’s design forums 
and workplace innovation. 

Helen Hare
BSc (Hons), MRICS 
Director of Project 
Management

Date joined the Group: 
Joined the Group in August 
2007 as Project Manager. 
Promoted to Head of 
Project Management in 
2017. Promoted to Director 
in 2019.

Experience and 
responsibilities: Formerly 
a Director of Brixton 
Estates and Commercial 
Manager at Bucknall Austin. 
Responsible for setting 
procurement strategy and 
ensuring capital expenditure 
on all projects is completed 
in accordance with individual 
asset business plans across 
the Group. 

Simon Rowley 
BA (Hons), MSc, MRICS
Head of Office Leasing

Date joined the Group: 
Joined the Group in 
January 2011 as Leasing 
Manager and appointed 
Senior Leasing Manager 
in April 2017. Promoted to 
Head of Office Leasing in 
September 2018. 

Experience and 
responsibilities: Formerly 
Associate Director at GVA 
Grimley. Responsible for 
implementing and executing 
leasing strategies and 
campaigns across the 
Group’s developments and 
large-scale refurbishments, 
including managing the 
Group’s approach to flex 
space offerings. 

Hugh Morgan
BSc (Hons), MRICS
Director of Investment 
Management

Date joined the Group: 
Joined the Group in 
September 2007 as 
Investment Manager 
and appointed Head of 
Investment Management 
in 2010. Promoted to 
Director in 2017.

Experience and 
responsibilities: Formerly 
a Director with Savills 
and previously with Nelson 
Bakewell. Responsible for 
generating and executing 
asset strategies for existing 
assets within the Group’s 
portfolio including hold/
sell decisions.

A member of the GHS 
Limited Partnership 
Operational Committee 
and a Director of the Great 
Wigmore Partnership.

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Rachel Aylett
BA (Hons), MA, Assoc CIPD
Head of Human Resources

Date joined the Group: 
Joined the Group in October 
2017 as Human Resources 
Manager. Promoted to Head 
of Human Resources in 
September 2018.

Experience and 
responsibilities: Formerly 
acting Head of HR and HR 
Manager at Kingley Napley 
LLP. Responsible for human 
resource management 
and development across 
the Group. 

Steven Mew
BSc (Hons), Dip PropInv,
MRICS
Portfolio Director

Date joined the Group: 
Joined the Group in 
October 2016 as Portfolio 
Director and a member of 
the Executive Committee.

Experience and 
responsibilities: Formerly 
Director at McKay Securities. 
Previously with Gooch 
Webster. Responsible for 
driving the performance 
of the Group’s investment 
portfolio. 

A member of the Group’s 
Executive Committee and 
a Director of the Great 
Ropemaker Partnership. 

Stephen Burrows
BA (Hons), MA, ACA
Director of Financial 
Reporting and IR

Date joined the Group: 
Joined the Group in 
September 2003 as Financial 
Accountant and appointed 
Head of Financial Reporting 
and Investor Relations in 
2011. Promoted to Director 
in 2017.

Experience and 
responsibilities: Formerly 
an Audit Manager in Ernst & 
Young’s Real Estate Group 
and previously with the 
National Audit Office. 
Responsible for financial 
reporting, forecasting 
and investor relations 
across the Group.

A member of the 
British Property 
Federation Technical 
Accounting Group. 

Martin Leighton
LLB, ACA, CTA
Director of Corporate 
Finance

Date joined the Group: 
Joined the Group in January 
2003 as Corporate Finance 
Manager and appointed 
Head of Corporate Finance 
in 2011. Promoted to 
Director in 2017.

Experience and 
responsibilities: Formerly 
a Corporate Finance 
Assistant Director with Ernst 
& Young. Responsible for 
the day-to-day management 
of all tax affairs, transaction 
structuring, raising debt 
finance and interest rate 
risk management across 
the Group.

A member of the British 
Property Federation 
Finance Committee. 

Rebecca Bradley
BSc (Hons), NEBOSH, IWFM
Head of Property Services

Date joined the Group: 
Joined the Group in May 
2020 as Head of Property 
Services.

Experience and 
responsibilities: 20 plus 
years of experience in the 
world of Property and FM. 
Most recently worked as a 
self-employed consultant 
advising various clients on FM 
management and strategy 
in the flexible workspace, 
contact centre, media/
marketing, social media and 
consumer goods industries. 
Previously employed in 
various FM/Property roles 
at British Airways, Microsoft, 
London Stock Exchange, 
Bank of America Merrill Lynch 
and Tishman Speyer.

Responsible for the delivery 
of property services across 
the portfolio.

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Darren Lennark
LLB 
Company Secretary (Interim) 

Alexis George
BSc (Hons)
Head of Health and Safety

Date joined the Group: 
Joined the Group in 
September 2019 as Interim 
Company Secretary.

Experience and 
responsibilities: Formerly 
a senior corporate lawyer 
at CMS for over ten years. 
Previously Deputy and 
Interim Group Company 
Secretary at Tesco plc and 
Group Company Secretary 
at Jardine Lloyd Thompson 
Group plc.

Responsible for driving 
the corporate governance 
agenda across the Group. 
Company Secretary for all 
joint venture companies.

Date joined the Group: 
Joined in March 2020 as 
Head of Health and Safety. 

Experience and 
responsibilities: 
Former Team Principal 
with Quantum Compliance 
and previously Health and 
Safety Lead at Windsor 
Great Park for the Crown 
Estate. Responsible for the 
strategic and operational 
delivery of health and safety 
management across the 
Group. A member of the 
Institute of Occupational 
Safety and Health.

Piers Blewitt
BSc, MRICS 
Head of Planning 
Strategy and Senior 
Development Manager

Date joined the Group: 
Joined in July 2003 as 
Development Manager. 
Promoted to Senior 
Development Manager in 
January 2016 and then to 
Head of Planning Strategy 
and Senior Development 
Manager in April 2020.

Experience and 
responsibilities:  
Formerly Development 
Manager at City & West 
End Developments and 
Development Securities.

Responsible for the creation 
of development business 
plans and their successful 
delivery.

Steven Rollingson
Head of IT

Date joined the Group: 
Joined the Group in 
February 2016 as IT 
Manager. Promoted to 
Head of IT in April 2019.

Experience and 
responsibilities: Formerly 
IT Manager at Skidmore, 
Owings and Merrill. 
Responsible for strategic 
and operational aspects 
of technology across 
the Group. 

Anisha Patel
BA (Hons)
Head of Marketing

Date joined the Group: 
Joined the Group in June 
2020 as Head of Marketing.

Experience and 
responsibilities: Formerly 
Head of Marketing and 
Enquiries at Workspace 
and previously Head of 
Customer Marketing UK 
and Ireland at HTC Europe. 
Responsible for the delivery 
of the Group’s marketing 
strategy and activities.

Annual Report 2020  Great Portland Estates 57

 
 
 
 
Our stakeholder relationships

Introduction 
Building and nurturing the relationships 
we have with our stakeholders is critical 
to our success and too valuable to 
outsource. As a result, we manage 
all aspects of our property portfolio 
in-house. We aim to build lasting 
relationships based on professionalism, 
fair-dealing and integrity. 
 › See more on our culture and people 

on pages 46 to 53 and engaging with our 
employees on page 103

 › See more on engaging with our shareholders 

on pages 103 to 105

Operational measures

Occupiers

Partners

>£280k

Raised for COVID-19 
Community Fund

30 days 

Average supplier 
payment period

29% 

Of net assets in 
joint venture

76% 

Staff participation  
in Community Day

+25.3

Net promoter score

Communities

Local planning  
authorities

Occupiers

Understanding our customers’ businesses and having a 
deep appreciation of what they require enables us to deliver 
a workplace environment in which they can focus exclusively 
on their core business needs. Having a strong, enduring 
relationship with them ensures that they remain satisfied 
within their existing space, and allows us to retain or relocate 
them when their occupational requirements change or their 
leases expire. The knowledge we gain by having a close 
working relationship with them is vital to help us design 
and deliver space in which their business can thrive. 

Today, we are navigating the commercial and societal impact 
of COVID-19 and the measures currently employed by the 
Government requiring the majority of businesses to adopt 
working from home as standard, alongside the application 
of social distancing protocols.

GPE occupier mix %

10%

1%

9%

34%

Retail, hospitality and leisure
Technology, media and telecoms
Professional
Banking and finance
Corporates
Government

31%

15%

As several of our occupiers fall within sectors deemed critical 
to the COVID-19 response, we have endeavoured to keep 
all of our managed portfolio buildings open and operating. 
We have implemented a range of measures to ensure the 
wellbeing of our occupiers, staff and service partners as 
we seek to maintain business as usual. We have been fully 
supported in this through the commitment and efforts of 
our key suppliers, our colleagues and staff. As a result, our 
relationships with our occupiers have grown stronger and 
mutually appreciative as we face these unprecedented 
challenges together.

Approach and objectives
The role of the property owner is rapidly evolving, as the 
needs of office occupiers change. Exemplary customer 
service and the provision of high quality amenity space 
is now key to the recruitment and retention of talent in a 
competitive marketplace. To ensure we can deliver and 
maintain the highest standards, we have a dedicated in-
house Occupier Services Team whose role is to manage the 
day-to-day operation of our buildings and deliver enhanced 
service provision for all of our customers. Delivering the right 
space and an extensive service offer gives businesses the 
opportunity to attract the best people and increases staff 
wellbeing and productivity. 

Knowledge of the changing needs of our occupiers requires 
a close relationship and frequent engagement. A key element 
of our approach is to require our portfolio managers to 
formally meet with every occupier twice a year and at least 
one Executive Committee member will meet with our top 
30 occupiers annually. These meetings, combined with the 
independent customer-service surveys we undertake, provide 
an understanding of how our occupiers’ real estate needs are 
developing and provide valuable insight into the health of the 
industries in which they operate. 

Progress during the year
A number of key themes arose from our engagement with 
our occupiers this year, including:

 – the increased requirement for additional service provision;

 – the importance of communication between occupier 

and owner; 

 – a heightened focus on staff wellbeing and the broadening 

of amenities within buildings;

 – greater promotion of sustainability initiatives; and

 – improving awareness of GPE’s brand and values.

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In response, we have implemented a number of initiatives. 
To aid the delivery of our high quality service offer, we rolled 
out ‘sesame’, our exclusive building app, to the entirety 
of our portfolio. The app provides a community platform 
within the building, allowing B2B and B2C opportunities, 
a dedicated lifestyle and concierge manager, a suite of offers 
and discounts from local businesses supporting the local 
economy, over 150 e-magazines and newspapers, automated 
smartphone access (dependent on building infrastructure) 
and environmental control of air conditioning systems. 
The app will also provide detailed analytics to further 
enhance and bespoke the services we provide.

These themes have also informed how we deliver our 
services. As a result, we have restructured our Occupier 
Services Team to: 

 – reflect the changing occupier requirements by recruiting 

directly from the hotel and hospitality industries;

 – use technology to better connect with our entire building 

population, irrespective of size or location;

 – expand the range of spaces where occupiers can 

congregate and collaborate, with services that support 
and complement their lifestyles;

 – engage people with new skills and a new mindset; 

 – have customer service at its heart; and

 – deliver enhancement of usable outdoor spaces.

Next steps
We expect that the demands of occupiers will continue to 
develop and, as a result, creating new innovative spaces for 
London will become increasingly complex. As our occupiers’ 
needs develop, so our products will continue to evolve. 
The role of our Director of Workplace and Innovation is 
to ensure that we remain innovative in the design of our 
workplaces, integrating sustainability and making the most 
of appropriate technology. This will require working closely 
with occupiers as many of our goals will require us working 
together. Energy consumption of our occupiers accounts for a 
third of our carbon footprint and therefore we are seeking to 
partner with our occupiers on a number of energy efficiency 
case studies. The studies will identify opportunities to 
reduce energy consumption either through improvements to 
building performance or by encouraging behavioural change. 

We will also need to collaborate across the property industry. 
As part of our ongoing research into how offices spaces may 
evolve, we also partner with six continental European office 
REITS to carry out research to understand what end users 
want. This research helped us to formulate ‘Our Guiding 
Principles for Design’, which define what will make each and 
every GPE development unique. Based on our consultation, 
experience and research, they allow us to respond to create 
the workplace of tomorrow.

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High levels  
of satisfaction

During the year, we commissioned an independent 
customer satisfaction survey to update our understanding 
of how our occupiers view their buildings and the services 
we provide. Encouragingly, our Net Promoter Score, best 
translated as the willingness to recommend GPE, increased 
from +17.5 in 2017 to +25.3 in 2019, materially ahead of our 
peer group which scored +12.9. 

From the feedback and comments we received, we are 
preparing building-specific action plans to further improve 
our services. We will continue to evolve our offer and, 
looking forward, will run the survey on an annual basis 
to benchmark our progress.

Net Promoter Score

25.3

17.5

Peer group
12.9

30

25

20

15

10

5

0

2017

2019

Source: RealService

Annual Report 2020  Great Portland Estates 59

 
 
 
 
Our stakeholder relationships continued

Working with 
our communities 

Our Community Strategy and social value 
guidelines ‘Creating Sustainable Relationships’ 
are designed to ensure that we contribute 
positively and secure long-term benefits 
for our communities. As a London business, 
it is essential that the themes in our strategy 
reflect the key priorities for our capital city, 
and therefore it is based around four pillars: 

Breaking the cycle of youth homelessness
Together with Centrepoint, our charity partner, we 
are focused on tackling youth homelessness in London. 
Centrepoint undertake fantastic work, not only providing 
much needed accommodation, but also a wide range of 
services from a helpline to their impressive engagement 
programme to help get young people into employment. 
During the year, we raised £100,000, including £25,000 
from our Community Day charity bike ride and a 
further £22,000 in goods in kind and pro bono support. 
We also continued to support Centrepoint in providing 
opportunities for trainee placements for their young people 
with our supply chain partners.

COVID-19 has had a significant impact on Centrepoint. 
Not only have they seen financial support decrease 
from corporate partners, but there have been significant 
challenges dealing with young people needing to self-
isolate within services. As a result, we increased our 
support, kick starting their emergency appeal with a 
£25,000 donation and helped with gifts in kind donations 
such as food supplies and hand sanitiser. 

Communities

To enable us to deliver spaces in central London we need 
to create enduring, sustainable relationships with the 
communities where we are working. We consider our 
communities to be London as a whole, the boroughs in which 
we work and the streets in which our buildings are located. 

Approach and objectives

As a business 100% focused on central London, our 
Community Strategy is designed to help address some of 
London’s key social and environmental challenges. 

We take a number of approaches to developing community 
relationships. Through our development process, we hold 
regular consultation exercises where we meet and listen to 
feedback from local community groups and through this 
we often build long lasting relationships, such as our current 
partnership with Bankside Open Spaces Trust. As members 
of a number of Business Improvement Districts in London and 
through regular engagement with borough councils, we hear 
first hand where investment and support is needed. This helps 
us provide assistance where it is most needed. During the year 
this led to the identification of schools in Islington that were 
in need of support on air quality and the provision of financial 
support for the Lisle Street green wall in SE1. 

We meet our charity partners regularly to understand their 
current challenges and this led to a change of focus with 
both Centrepoint and Groundwork London following the 
COVID-19 outbreak. 

Progress during the year

Both Centrepoint and Groundwork London have seen 
donations fall in the wake of the COVID-19 pandemic. 
Never has the need to create strong supportive relationships 
with community partners been more important, nor the link 
between social and environmental challenges been more 
evident. As a result of COVID-19, we have undertaken a review 
of our community budget and strategy, and in response: 

 – confirmed our commitment to our existing charity partners, 
Centrepoint and Groundwork London, committing to an 
additional year’s support until April 2022 and raised our 
charitable contributions in both cases;

 – made additional donations to Bankside Open Spaces 
Trust to support them in keeping open spaces open 
within the London Borough of Southwark;

 – raised our overall corporate community budget 

to £200,000; and

 – set up a new GPE Community Fund to supplement our 

community budget, seed funded with more than £280,000 
by our Directors, Executive Committee and staff, with GPE 
matching contributions, to help support London’s needs 
both in the short term and in addressing the longer-term 
social impact of the COVID-19 crisis. 

We believe that this strategy, coupled with our commitment 
to integrating the measurement of social impact through the 
design and construction of our buildings, will deliver a lasting 
benefit for the communities in which we work. 

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Great Portland Estates  Annual Report 2020

Improving air quality and urban greening
Air pollution is a significant concern for London and the 
health and wellbeing of the communities in which we work. 
Green spaces and improved biodiversity help to improve 
air quality and support adaption to and mitigation from 
the impacts of climate change.

During the year, we donated £40,000 to Groundwork 
London, which was specifically directed to improving air 
quality in and around London schools. Over the last two 
years we have directly supported ten schools across Tower 
Hamlets, Southwark, Camden and Islington on biodiversity 
and air quality initiatives. 

Furthermore, as part of our community day, in which 76% 
of our staff participated, we spent two days transforming 
a community garden in Hackney, improving biodiversity 
in Burgess Park, Southwark and up-cycling old furniture in 
Barnet. Due to COVID-19, Groundwork London has seen 
bookings for corporate days decrease, so we increased our 
annual donation to them by £10,000 to help support older 
people and refugee communities currently self-isolating. 

As a member of Wild West End, we are working together 
with other property owners in London’s West End to 
enhance biodiversity and increase connections with green 
space and nature. As part of our membership we also 
monitor the impact of our existing green interventions, using 
their value matrix to baseline biodiversity across our portfolio 
and taking that learning into the design of our new buildings, 
which ultimately improves the wellbeing of residents, workers 
and visitors. We have also continued our support for Bankside 
Open Spaces Trust which aims to make London Bankside 
a greener, more beautiful place to live and work and installed 
new greening at New City Court with their apprentice 
gardeners. The activities of Bankside Open Spaces Trust have 
been significantly curtailed by COVID-19 and therefore we 
provided an additional donation to support their rescheduled 
Great Get Together event and a further contribution to help 
keep the parks in Southwark open.

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Addressing the skills gap through 
engagement with education
In order to ensure that we can continue to develop and 
refurbish the workplaces and homes of the future, it is 
essential that we support local skills and opportunities 
more broadly across the industry to help develop the 
skilled workforce of tomorrow. Since 2013, we have built 
a rewarding relationship with Westminster University in 
supporting their building related degree programmes. 
During the year, we provided assistance to 250 students 
either through a series of lectures on Sustainability 
and Innovation, or through real case study material 
from our Hickman, Hanover Square and New City 
Court developments to inform their studies. We also 
supported the 2020 Build UK Open Doors scheme.

Mitigating the risk of modern slavery 
in our portfolio
We seek to ensure that there is no slavery or human 
trafficking within any part of our business or in our supply 
chains. We support the Gangmasters and Labour Abuse 
Authority’s Construction Protocol which aims to eradicate 
slavery and labour exploitation in the building industry 
and encourage our contractors to consider the use of the 
BRE Ethical Labour Sourcing Standard. We also encourage 
the payment of the London Living Wage for all operatives. 
Worker Engagement Audits are undertaken regularly at 
our construction sites in addition to materials procurement 
risk assessments to verify the supply chain for materials 
being used within our buildings. In particular, all our 
new build developments and major refurbishments are 
required to obtain Forest Stewardship Council project 
certification, which assists in verifying the stewardship 
of timber products.

Annual Report 2020  Great Portland Estates 61

 
 
 
 
Our stakeholder relationships continued

Communities – continued

Partners – our suppliers

Next steps

The strong relationships we have with our community partners 
have been a great success and an embodiment of living our 
values. By giving both our charity partners, Centrepoint and 
Groundwork London, access to our supply chain we have truly 
achieved more together. 

Our engagement with Westminster University is also growing 
and during the next financial year we will be supporting three 
Masters students as they embark on dissertations connected 
with net zero carbon buildings, supporting innovative thinking 
on a significant challenge for the industry. 

Our engagement with the communities surrounding 
our developments has proved particularly rewarding. 
Our relationship with Bankside Open Spaces Trust created 
an opportunity for their apprenticeship gardeners to install 
temporary greening on an occupier’s terrace at New City 
Court. This opportunity supported local aims to increase 
urban greening in the area, both improving the wellbeing 
of our occupiers and providing an additional learning 
opportunity for the apprentice gardeners. We will build 
on this approach in the forthcoming year, looking for 
opportunities to engage with community partners, as part 
of our commitment in our Sustainability Statement of Intent 
‘The Time is Now’ to create £10 million of Social Value within 
our local communities by 2030. 

We work with a broad and diverse range of suppliers, from 
small independent companies to large multinationals. 
The successful and profitable delivery of our larger projects 
requires the effective management of a multitude of factors, 
including maintaining strong relationships and collegiate 
working. Whilst most procurement is often subject to a 
tender process to ensure we obtain value for money, we 
aim to partner with suppliers who share our values and work 
collegiately to secure the best people with an established 
track record and, where possible, retain key team members 
on successive projects. 

Approach and objectives

The close relationship we foster with our suppliers, alongside 
a track record of successful project delivery and a deep 
pipeline of future work, means that people want to work with 
us, and ensures that we have good access to quality partners. 
We also aim to treat our suppliers fairly through prompt 
payment, including bi-monthly payment terms with some of 
our largest contractors. Whilst we expect all our suppliers 
to comply with standards and codes that may be specific to 
their industry, our Supplier Code of Conduct sets out the 
standards that we require of our suppliers. Furthermore, 
in order for us to achieve our goal of decarbonising our 
business by 2030, we will need engagement from all of our 
suppliers. We therefore ensure that the sustainability goals 
of our suppliers are taken into account when tendering 
our contracts.

Progress during the year

We rely on our suppliers to help us deliver our development 
programme and to provide a number of key services across 
our portfolio, including security, cleaning and property 
maintenance. As a result, to our occupiers, our suppliers are 
the face of GPE. During the year, we have partnered with 
fewer providers to improve service levels and consistency 
across our portfolio, aiming to:

 – ensure we work with service partners that are fully aligned 

and promote our values and culture;

 – help us deliver sustainability targets through direct 

engagement with our service teams; and

 – further promote a strong health and safety culture across 

the portfolio. 

The Group’s largest subsidiary is required to report on its 
payment practices and, for the period to 31 March 2020, we 
improved our performance with an average payment period 
of 30 days, with more than two thirds of payments made 
to term.

Next steps

We are currently in the early stages of procuring the 
construction contract for the redevelopment of 50 Finsbury 
Square, EC2. Elements of the scheme are being tendered 
separately with the intention of appointing the main 
contractor ahead of commencing the development early 
next year. 

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Great Portland Estates  Annual Report 2020

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The outcomes of these checks are being included with 
our whole building approach to fire safety, joining up our 
fire strategy, with our risk assessment, maintenance and 
management checks and occupier fire safety monitoring 
checks to produce a continuous thread of regularly updated 
information from design to operation and management 
of our buildings. All suppliers are expected to provide 
evidence of health and safety training for their people. 
Where accidents do occur, we work with our supply chain 
on accident investigation to understand lessons learned, 
opportunities for improvement and consider how the work 
could have been set up differently and understand how, 
as a client, we can support our suppliers better. 

The COVID-19 pandemic has required us to put additional 
health and safety processes in place for our employees, 
occupiers and suppliers. We have followed Government 
guidelines from the start of the outbreak, supported our 
employees in their transition to home working, worked with 
our suppliers to ensure that essential building maintenance 
could be carried out safely and introduced additional 
cleaning measures and social distancing protocols to 
reassure our occupiers.

In March 2020, there was an accident at one of our occupied 
buildings where a subcontracted window cleaner fell from 
height. The operative concerned was seriously injured. 
We are working closely with our internal team and our 
supply chain to undertake a full accident investigation and 
understand if there are any opportunities to improve our 
current processes and procedures. The Board are kept fully 
updated on the investigation with progress reports on the 
investigation provided to them in April and May 2020.

Health and safety incidents by year

2020

2019

2018

Enforcement notices 
or fines received 
Employees
Work related fatalities
Reportable injuries/incidents
First aid injuries
Number of days off due 
to accidents and incidents
At our occupied buildings
Work related fatalities
Reportable injuries/incidents
First aid injuries
At our developments
Work related fatalities
Reportable accidents/incidents
First aid injuries

–

–
–
3

–

–
2
14

–
4
14

–

–
–
3

–

–
2
13

–
1
6

–

–
–
3

–

–
2
15

–
3
19

Providing 
safe, healthy 
and secure 
environments

We aim to provide safe, healthy and secure 
environments and are committed to maintaining 
the highest standards of health and safety across 
our portfolio and to remaining at the forefront of 
industry change, whilst reducing exposure to risk for 
our occupiers, supply chain partners and employees. 
Whilst we have always had a proactive attitude 
towards health and safety, changes and attitudes 
within the industry are helping us to develop a more 
collaborative approach with our supply chain.

During the year, following Board approval, we launched 
a new Health and Safety strategy, with the goal of 
embedding a proactive approach to health and safety 
across our business and with our supply chain partners 
which goes beyond legal compliance. The main aim was to 
create an integrated approach, with each individual in the 
business having the confidence to take ownership of health 
and safety. The strategy was launched in September by the 
Chief Executive and then rolled out across the business by 
the health and safety team to help our people understand 
how it impacted their individual roles. Since then, we have 
improved our health and safety management system, 
integrating systems between our development, occupier 
and property services teams to improve communication. 
All employee related health and safety information has 
been updated and incorporated on our intranet, complete 
with case studies of health and safety leadership in the 
business. We are instigating a programme of senior 
leadership team health and safety tours of our development 
sites and managed portfolio with a number of inspections 
taking place during the year. These visits look to identify 
where additional support is needed on health and safety 
for our internal team and also to discuss health and safety 
with our suppliers. The visits also provide opportunities to 
celebrate examples of a positive health and safety culture.

Our change in approach is also being reflected in how we 
measure health and safety performance incorporating the 
use of both reactive measures such as accident reporting 
and outcomes from accident investigation as well as more 
proactive health and safety indicators such as positive 
health and safety observations and the implementation of 
control measures. We are also supporting our occupiers, 
rolling out occupier fire safety monitoring checks to help 
provide information on changing expectations on fire 
safety across the industry. These checks are allowing us to 
have regular conversations with our occupiers on health 
and safety matters more generally, raising awareness and 
allowing potential concerns to be dealt with proactively. 

Annual Report 2020  Great Portland Estates 63

 
 
 
 
Our stakeholder relationships continued

Partners – our joint ventures

Local planning authorities 

Joint ventures are an important part of our business and 
today they comprise three active partnerships. Our joint 
ventures are built on long-term relationships with trusted, 
high quality partners. At 31 March 2020, they made up 
25.8% of the portfolio valuation, 29.4% of net assets and 
19.3% of rent roll (at 31 March 2019: 22.8%, 22.2% and 
19.2% respectively).

Approach and objectives

Our approach has been to seek joint venture partners to 
help us unlock real estate opportunities that might not have 
been available to GPE alone, either through sharing risk 
or providing access to new properties. The success of our 
joint venture activities relies on strong relationships with our 
partners based on frequent engagement. Each partnership 
has a joint board (including at least one GPE Executive 
Director) that meets quarterly on a formal basis with frequent 
ad hoc engagement throughout the year. The joint venture 
properties are valued quarterly, with detailed management 
information being provided to the joint venture board. 

Progress during the year

Key decisions made by the respective joint venture boards 
in the year include:

 – in the Great Ropemaker Partnership (GRP), we agreed 

to repay the £90.0 million bank loan facility in full;

 – in the GHS Limited Partnership (GHS), we agreed a pre-let 
of the flagship retail unit on New Bond Street to Canali; and

 – in the Great Victoria Partnership (GVP), we have been 
collaborating with a number of the local stakeholders, 
and Westminster Council, to work up the development 
plans for our Mount Royal site at the western end of 
Oxford Street.

Next steps

Looking forward, we are working closely with our partners 
to advance our business plans, including completion of the 
leasing at Hanover Square, W1 in GHS and progressing 
the planning application for our proposed development 
at Mount Royal, W1 in GVP. 

Wholly-owned and joint venture property values  
at 31 March 2020

3%

23%

74%

Wholly-owned £1,946.4m
Joint ventures: 
Risk sharing £604.2m
Joint ventures: Access to 
new properties £73.5m

Developing new buildings in central London is appropriately 
challenging, particularly in the West End. Large areas are 
protected by conservation areas, building heights are 
restricted, development needs to be considerate to local 
residents and the planning process is stringent. As a result, 
our relationships with local planning authorities are key to 
the delivery of new spaces in London. The emerging London 
Plan is now being adopted as policy and includes a number 
of further challenging requirements. 

Approach and objectives

Navigating the planning process is a core driver of our 
success. We aim to engage with local authorities in an open, 
transparent and non-adversarial manner to enable us to 
secure planning consents that are both beneficial to us and 
the local communities in which they are built. In line with 
our social value guidelines, as a matter of course, we liaise 
with community stakeholders to understand their needs. 
Our buildings need to positively impact the communities in 
which they are located and therefore, where possible, we will 
adjust our proposals to take account of comments received. 
We use planning performance agreements with the local 
planning authority to ensure that our planning applications 
are determined in a timely manner. 

Key activities in the year

During the year we have continued to work with community 
groups in the London Bridge area, supporting air quality 
and urban greening projects, apprenticeship opportunities 
and local schools. Over the coming months we will continue 
to support these initiatives, focusing on ensuring that our 
proposals for New City Court, SE1 enhance the excellent work 
already being undertaken by community groups in the area. 
This process is implemented at each development scheme, 
with urban greening and biodiversity projects currently 
being supported in Islington as part of early engagement for 
our 50 Finsbury Square, EC2 and our social value guidelines 
are in the process of being implemented in full for Oxford 
House, W1. 

Next steps

Over the next 12 months we will be launching consultations 
for a number of our development pipeline projects. This will 
involve liaising with our key stakeholders, local residents 
and local authorities to ensure that our proposals are fully 
explained and have a broad base of support. In line with 
our social value guidelines, we will look for local community 
projects that our schemes can support. Sustainability is 
becoming ever more important in the planning process 
with many of our key local authorities declaring climate 
emergencies. We will look to work with them to support 
their principles of ‘good growth’.

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Section 172(1) statement

The directors have acted in a way that they considered, 
in good faith, to be most likely to promote the success 
of the Company for the benefit of its members as a whole 
and, in doing so, had regard, amongst other matters, 
to those matters set out in section 172(1)(a) to (f) of the 
Companies Act 2006, being: 

 – the likely consequences of any decision in the long term; 

 – the interests of the Company’s employees; 

 – the need to foster the Company’s business relationships 

with suppliers, customers and others; 

 – the impact of the Company’s operations on the 

community and the environment; 

 – the desirability of the Company maintaining a 

reputation for high standards of business conduct; and 

 – the need to act fairly as between members of 

the Company.

Our stakeholders

GPE has identified its key stakeholders as being its: 
employees, occupiers, suppliers, shareholders and 
debt capital providers, JV partners, communities and 
local planning authorities. Building and nurturing these 
relationships based on professionalism, fair dealing and 
integrity is critical to our success. 

Our engagement

Our extensive engagement efforts help to ensure that 
the Board can understand, consider and balance broad 
stakeholder interests when making decisions to deliver long-
term sustainable success. Details of how we engage with our 
stakeholders can be found on pages 58 to 64 and 103 to 106.

Board processes

While the Board will engage directly with stakeholders 
on certain issues, stakeholder engagement will often 
take place at an operational level with the Board receiving 
regular updates on stakeholder views from the Executive 
Directors and senior management. 

As part of the director induction process, directors 
receive a briefing and induction materials regarding their 
duties under s.172. Training has further been delivered 
by the Corporate Secretariat team to management to 
ensure that they understand the duties of the Board and the 
importance of s.172(1) matters in GPE’s strategy discussions 
and decision making. Board papers for all key decisions are 
required to include a specific section reviewing the impact 
of the proposal on relevant stakeholder groups as well as 
other s.172(1) considerations. 

The page overleaf sets out some examples of how the 
Board has considered s.172(1) matters in its decision making 
in 2019/20.

You can read more about our approach to s.172(1) matters and stakeholder engagement as follows:

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Key decisions and long-
term consequences

Employees

A clear plan and financial strength

How we create value

Impact on decisions

Chairman’s letter

What we did in 2019/20

Our culture and people

Leadership and purpose

Fostering business 
relationships with suppliers, 
customers and others

Our stakeholder relationships

Leadership and purpose

Community 

Our stakeholder relationships

Leadership and purpose

Environment

Our portfolio

High standards of  
business conduct

Our stakeholder relationships

Our culture and people

Our stakeholder relationships

Chairman’s letter

 › See more on pages 4 to 5

 › See more on pages 16 to 17 

 › See more on page 66

 › See more on pages 97 to 99

 › See more on pages 108 to 109

 › See more on pages 46 to 53

 › See more on pages 102 to 103

 › See more on pages 58 to 64

 › See more on page 106

 › See more on pages 58 to 64

 › See more on page 106

 › See more on pages 68 to 77

 › See more on pages 58 to 64

 › See more on pages 46 to 53

 › See more on pages 58 to 64

 › See more on pages 97 to 99

Anti-bribery and corruption, ethics and whistleblowing

 › See more on pages 106 and 122

Investors

Leadership and purpose

Our capital strength

 › See more on pages 103 to 105

 › See more on pages 78 to 79

Annual Report 2020  Great Portland Estates 65

 
 
 
 
Our stakeholder relationships continued

Impact on decisions

Some examples of how the Board has considered stakeholder interests and s.172(1) matters in its decision making in 
2019/20 are set out below and in ‘What we did in 2019/20’ on pages 108 and 109.

 › See more on page 78

 › See more on page 41

 › See more in the Directors’ remuneration 

report on pages 126 to 154

ESG-linked  
RCF

Increasing our 
flexible space offer

Remuneration 
policy

In January 2020, the Board approved 
a new ESG-linked unsecured revolving 
credit facility (RCF) to replace its 
existing RCF. In considering the 
proposal, the Board reviewed the 
likely consequences of the refinancing 
in the long term, including the positive 
financial impacts of a lower margin 
on costs and an extended debt 
maturity date. 

The Board discussed the increasing 
focus of employees, occupiers and 
investors on sustainability matters and 
the commercial imperative to drive 
forward GPE’s sustainability agenda. 

The Board approved three challenging 
ESG-linked KPIs which aligned with 
GPE’s strategy, to unlock potential, 
creating high quality, sustainable 
spaces that occupiers demand, our 
values and the values of our lenders.

The Board agreed that all margin 
adjustments, to be achieved 
through the delivery of the KPIs, 
would be donated to registered 
charities focused on environmental 
initiatives in furtherance of our 
Community Strategy.

The Board has regard to stakeholder 
views as an integral part of its strategy 
discussions. This year particular 
focus has been given to the further 
development of GPE’s flex product.

In order to fully understand occupier 
demands and market trends, the 
Board receives regular updates 
from meetings with our occupiers 
and agents and discusses market 
updates and feedback from our 
occupier surveys. 

As the relationship between owner 
and occupier evolves, the Board has 
considered greater occupier demand 
for increased flexibility and service 
provision and appropriate action to 
maximise the opportunity we have 
to generate long-term value for 
our shareholders, employees and 
other stakeholders.

The Board has therefore supported 
extending our commitment to flexible 
office space during the year, including 
the expansion of our co-working 
partnerships at City Place House, 
EC2 and committing to our new flex+ 
product to enhance our existing 
flex offering, innovating across our 
operations and working with our 
communities to create space for 
London to thrive.

In considering the proposed changes 
to our Directors’ remuneration policy 
this year, careful consideration was 
given to appropriately incentivising 
management and employees to 
deliver our strategy for the benefit 
of stakeholders, while reinforcing 
behaviours in line with our culture 
and values. 

In considering the Directors’ 
remuneration policy, the 
Remuneration Committee discussed 
alignment with wider workforce 
policies and led an extensive 
consultation exercise involving 
shareholders, representing over 
50% of GPE’s share register, and 
proxy advisory bodies. 

The feedback received from this 
process helped to shape our revised 
Directors’ remuneration policy 
in a number of areas, including: 
the addition of ESG targets 
within annual bonus measures; the 
introduction of post-employment 
share ownership guidelines; and 
our commitment to align Executive 
Director and wider workforce pension 
contribution rates by the end of 2022. 
Shareholders will be asked to approve 
the revised policy at this year’s AGM.

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Non-Financial Information Statement
This table signposts related non-financial information in this report and further reading on our website.

Reporting  
requirement1

Policies

Website

1.  Environmental  

Sustainability policy statement

matters

Creating Sustainable Spaces –  
Sustainable Development Brief

Our Guiding Principles of Design

Sustainability Statement of Intent

www.gpe.co.uk/sustainability/ 
our-approach

www.gpe.co.uk/sustainability/
developing-sustainable-buildings

www.gpe.co.uk/sustainability/ 
our-sustainability-statement- 
of-intent

Reference in  
2020 Annual Report

 › See more about The Time is Now 

on pages 8 and 72

 › See more about our sustainable 

portfolio on pages 68 to 77

2. Employees

Our values

Diversity policy

Inclusion and Diversity strategy

Personal Development Plans

www.gpe.co.uk/about-us/ 
our-purpose-values

www.gpe.co.uk/ 
our-relationships/our-employees

 › See more about our values on page 3
 › See more about our culture and 

people on pages 46 to 53

 › See more about inclusion and 
diversity on pages 50 to 51 and 
page 114

3.  Human  
rights

Supplier Code of Conduct

Annual Modern Slavery Statement

4. Social

Creating Sustainable  
Relationships

GPE Standard Supply Terms 

Health and Safety policy

www.gpe.co.uk/ 
our-relationships/our-suppliers

www.gpe.co.uk/sustainability/ 
our approach

www.gpe.co.uk/ 
our-modern-slavery-statement

www.gpe.co.uk/our-
relationships/community-
relationships

www.gpe.co.uk/our-
relationships/our-suppliers

www.gpe.co.uk/sustainability/
working-safely

 › See more about how we behave, 

human rights and supplier 
stewardship on page 106

 › See more about mitigating the 
risk of modern slavery on page 61

 › See more about partners – 
our suppliers on page 62

 › See more about our stakeholder 
relationships pages 58 to 66 
 › See more about communities 

on page 60

 › See more about partners – 
our suppliers on page 62

 › See more about providing safe, 
healthy and secure environments 
on page 63

 5.  Anti-corruption 
and anti-bribery

Ethics policy

Whistleblowing policy

www.gpe.co.uk/about-us/
governance

Gifts and Hospitality policy

Use of GPE Suppliers policy

Conflicts of Interest policy

Inside Information and Share 
Dealing policy

 › See more about anti-corruption 

and anti-bribery matters on page 106
 › See more about our anti-bribery and 
corruption, ethics and whistleblowing 
policies on page 122

6.  Business  
model

7.  Principal 
risk and 
uncertainties

8.  Non-

financial key 
performance 
indicators

www.gpe.co.uk/about-us/ 
our-strategy

 › See more about how we create 

value on pages 16 and 17

Group Risk Management policy

www.gpe.co.uk/about-us/
governance

 › See more about our approach 

to risk on pages 80 to 93

www.gpe.co.uk/investors/
investment-case/key-
performance-indicators-2020

 › See more about our KPI benchmarks 

on pages 18 and 19

 › See more about our near-term 
strategic priorities on pages 30 
and 31

1.  Board oversight of these policies and matters is also covered through ‘What we did 2019/20’ on pages 108 and 109.

Annual Report 2020  Great Portland Estates 67

 
 
 
 
Our portfolio

Introduction 
Our portfolio has its origins in the 
West End, which accounts for 69% of 
our properties. We only operate in 
central London, but have expanded 
our locations to encompass the City, 
Southwark and Midtown.

Operational measures

-0.3%

56%

Movement in property 
valuation (on a like-for-
like basis)

Percentage of portfolio 
in development 
programme

100%

Energy purchased  
on renewable tariffs

0.1%

% of portfolio with  
EPC rating >E

Our approach
Our focused business model is based upon repositioning 
properties to unlock their full potential. This repositioning 
relies on having a deep understanding of the markets 
in which we operate, both to enable us to unearth new 
opportunities as we find them and to deliver buildings that 
meet the demands of modern occupiers. 

We aim to position our portfolio to maximise the opportunity 
for future growth. As a result, every property has a detailed 
business plan which forecasts each and every occupier’s 
future cash flows and, using our own assumptions for future 
movements in rents and yields, forecasts the forward look 
returns for the portfolio. If a property’s prospective returns 
do not meet our required investment hurdles, taking into 
account both our cost of capital and the risks, typically it 
is sold.

Ensuring that our properties meet the requirements of 
modern occupiers is fundamental to the delivery of our 
business plans. We aim to deliver buildings that let well in 
their local markets, are future-proofed in a rapidly changing 
world and have regard to the wider environment in which 
they are located. Through the responsible management and 
development of our portfolio, we aim to deliver sustainable 
returns that enhance the long-term value of our business. 

Well located central London portfolio
Our specialist approach requires focus. As a result, we only 
operate in central London. Whilst our origins lay in the West 
End, we recognise that central London is growing, and as it 
grows, new locations will become sought after by occupiers 
seeking new homes for their businesses. As a result, we 
remain opportunistic and will invest across central London 
where we see both value and opportunities for growth. 
 › See more about our London on page 24

100%

Of the portfolio in central London

68

Great Portland Estates  Annual Report 2020

Our portfolio – 69% in West End

5%

8%

18%

36%

North of Oxford Street £942.0m
Rest of West End £863.7m
City £467.6m
Southwark £202.8m
Midtown £148.0m

33%

Positioned for organic growth
In 2009 and 2012, we raised equity capital to take 
advantage of the value that we saw in the investment market. 
As a result, we were net buyers in the four financial years to 
31 March 2013. These acquisitions have helped stock our 
future development programme which today totals 56% 
of the Group’s existing portfolio. 

Our central London portfolio (%)

22%

7%

Long-dated
Active portfolio management
Development pipeline
Committed developments

34%

37%

Of the remainder of the portfolio, 37% are buildings 
where we will add future value through active 
portfolio management. Typically, these buildings have 
shorter leases, are reversionary and have significant 
repositioning opportunities. 

The long-dated assets, representing 7% of the portfolio, 
are properties that we recently redeveloped and are long 
let. Given the long lease terms we have achieved on these 
buildings, there is typically limited opportunity for us to add 
further value. As a result, over time, we expect to crystallise 
the profits we have made through sales. 

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Open sesame
Technology supporting an enhanced occupier experience

In order to ensure that our spaces continue to meet 
the needs of our occupiers into the next decade 
and beyond, we need to create buildings which 
offer their users: 

 – sustainable spaces that promote health and wellbeing;

 – control over their environment;

 – choice of where they work in a supported, relaxed 

environment; and

 – access to superior levels of service and amenity. 

Advances in technology can help deliver these goals. 
Our smartphone app, ‘sesame’, puts greater control in the 
hands of the user, through automated building access and 
the ability to adjust cooling and lighting. It also provides 
a number of services to building occupiers including the 
provision of a community platform, a library of newspapers 
and magazines and a lifestyle concierge service.

Moreover, the data generated by the app, in combination 
with sensors in the workplace, can provide constant 
anonymous feedback on occupancy levels, temperature, 
light levels, air quality and noise. This feedback will allow us 
to work with our occupiers to adapt and flex the building 
environment as their business needs evolve. We are also 
utilising digital twin technology to monitor the real-time 
performance of the building to ensure the building is 
operating as designed and even anticipate when items of 
plant and machinery need replacing. 

At The Hickman, our 74,400 sq ft development in 
Whitechapel, E1, we have fully integrated technology, 
sustainability and wellbeing from inception. We are 
refurbishing the fabric of the existing building to reduce the 
total embodied carbon of the project and, with a BREEAM 
Excellent and EPC A rating targeted, it is expected that 
the building will achieve an energy improvement of 
almost 40% over current Building Regulations’ energy 
efficiency requirements. 

The Hickman will also be able to learn and adapt according 
to use, meaning we are able to optimise the conditions for 
occupation, reducing energy consumption and associated 
carbon emissions, whilst improving comfort levels for 
our occupiers. 

Through our fresh contemporary design, we will be 
able to offer a choice of flexible work settings, providing 
opportunities for quiet, independent work as well as 
collaboration space. Furthermore, occupiers will also 
benefit from our lifestyle service, allowing them to access a 
host of other, value added services at a push of a button.

In line with our commitment to promote improved air quality 
and biodiversity, we are increasing urban greening, installing 
a green roof, terraces and planting within the courtyard. 
The provision of 79 bike spaces and showers, coupled with 
the close proximity of a public park, will provide further 
opportunities for our occupiers to exercise and access 
outdoor space, positively impacting their wellbeing.

Annual Report 2020  Great Portland Estates 69

 
 
 
 
Our portfolio continued

With the full impact of the disruption 
from COVID-19 yet to be felt, portfolio 
values were broadly stable, reducing 
by 0.3% on a like-for-like basis.” 

Hugh Morgan 
Director of Investment Management

Portfolio values broadly stable; down 0.3% in year
The valuation of our portfolio, including our share of joint 
ventures, fell marginally over the 12 months by £8.8 million, 
or 0.3%, on a like-for-like basis, to £2,624.1 million at 
31 March 2020.

The key drivers behind the Group’s valuation movement 
for the year were: 

 – retail rental value declines – in the past 12 months 
rental values across our retail portfolio were down 
4.3% on a like-for-like basis, with our office portfolio 
rental values increasing by 3.5%, largely driven by our 
leasing performance;

 › See more about our market on pages 23 to 29

 – development gains – the valuation of our committed 
development properties increased by 11.9% on a 
like-for-like basis to £590.3 million during the year as 
demand for high quality space continued to outstrip 
supply supporting values and two of our three schemes 
approached completion; 

 › See more about our development management on pages 34 to 38

 – active portfolio management – during another strong year, 
75 new leases, rent reviews and renewals were completed, 
with new lettings 8.8% ahead of ERV, securing £24.9 million 
(our share) of annual income, supporting the valuation over 
the year; and 

 › See more about our portfolio management on pages 39 to 41

 – higher investment yields – the valuation was marginally 
reduced by yield movements which increased by six 
basis points (2019: one basis point increase) during the 
year. At 31 March 2020, the portfolio true equivalent yield 
was 4.6%.

 › See more about our market on pages 23 to 29

Including rent from pre-lets and leases currently in rent-free 
periods, the adjusted initial yield of the investment portfolio 
at 31 March 2020 was 4.0%, 20 basis points lower since the 
start of the financial year.

Drivers of valuation growth (%)

(0.2)

(1.5)

1.4

-2.0%

0.0%

2.0%

Rental value growth

Yield shift

Residual

70

Great Portland Estates  Annual Report 2020

Whilst the overall valuation was marginally down by 0.3% 
during the year, elements of the portfolio showed greater 
variation. Our office properties rose by 1.0% compared to a 
3.5% fall in retail values, as weaker retailer sentiment reduced 
ERVs and softened yields. Furthermore, short leasehold 
properties (<100 years), which represent 17% of the portfolio, 
reduced in value by 10.2% compared to an increase of 1.9% 
in the rest of the portfolio, as investor demand for shorter 
leasehold assets reduced.

Our joint venture properties increased in value by 7.8% over 
the year, driven by our committed development at Hanover 
Square, W1, which increased in value by 28.5% following 
further pre-letting activity, while the wholly-owned portfolio 
fell by 2.9% on a like-for-like basis. 

Material valuation uncertainty
The rapid spread of COVID-19 has disrupted activity in 
our real estate markets, creating heightened valuation 
uncertainty for CBRE, the Group’s valuers. As a result, CBRE 
has included a clause within the valuation report which 
highlights a ‘material valuation uncertainty’. This clause 
serves as a precaution and does not invalidate the valuation, 
and does not mean that the valuation cannot be relied 
upon. Rather, it is intended to highlight that due to current 
extraordinary circumstances, less certainty can be attached 
to the valuation than would otherwise be the case.

Our relative performance
The Group delivered a total property return (TPR) for the year 
of 3.7%, compared to the central London MSCI quarterly 
index of 2.5%, and a capital return of 0.3%, versus -0.8% 
for MSCI. This outperformance results from the strong 
performance of our committed developments in the year, 
in particular at Hanover Square and The Hickman, where 
we are delivering prime, Grade A space into a supply 
constrained market. 

Long-term outperformance  
Relative returns vs MSCI 
Relative capital growth % p.a.1

320

280

240

200

160

120

80

‘04

‘05

‘06

‘07

‘08

‘09

‘10

‘11

‘12

‘13

‘14

‘15

‘16

‘17

‘18

‘19

‘20

GPE

MSCI Central London

Universe

1.  2004 – first pure comparability to MSCI Central London.

11.9%

Development properties valuation uplift

Portfolio performance

North of Oxford Street

Rest of West End

Total West End
City, Midtown and Southwark

Total City, Midtown and Southwark
Investment property portfolio
Development property
Total properties held throughout the year
Acquisitions

Total property portfolio

1.  GPE share.

Portfolio characteristics

Office
Retail
Residential
Office
Retail
Residential

Office
Retail
Residential

Wholly- 
owned 
£m

Joint
ventures1
£m

Total 
£m

Proportion  
of portfolio  
%

Valuation 
movement  
%

550.4
121.1
4.5
251.9
236.9
5.7
1,170.5
506.2
13.7
4.4
524.3
1,694.8
251.6
1,946.4
–

1,946.4

–
73.5
–
–
30.5
–
104.0
232.2
2.8
–
235.0
339.0
338.7
677.7
–

677.7

550.4
194.6
4.5
251.9
267.4
5.7
1,274.5
738.4
16.5
4.4
759.3
2,033.8
590.3
2,624.1
–

2,624.1

21.0
7.4
0.2
9.6
10.2
0.2
48.6
28.1
0.6
0.2
28.9
77.5
22.5
100.0
–

100.0

0.9
(15.5)
(0.8)
(1.3)
(3.5)
0.7
(3.3)
(1.8)
(47.9)
–
(3.6)
(3.4)
11.9
(0.3)
–

(0.3)

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Investment 
properties  
£m

Development 
properties  
£m

Total  
property 
portfolio  
£m

Office  
£m

Retail  
£m

Residential  
£m

Net internal 
area sq ft 
000’s

Total  
£m

North of Oxford Street
Rest of West End
Total West End
City, Midtown and 
Southwark
Total
By use:

Total
Net internal area sq ft 000’s

Office
Retail
Residential

749.5
525.0
1,274.5

759.3
2,033.8
1,540.7
478.5
14.6
2,033.8
2,172

192.5
942.0
646.2
422.3
863.7
338.7
531.2 1,805.7 1,068.5

59.1

797.4
818.4
590.3 2,624.1 1,865.9
1,865.9
325.2
734.0
255.5
24.2
9.6
590.3 2,624.1
2,587

415

291.3
426.1
717.4

16.6
734.0

4.5
942.0
863.7
15.3
19.8 1,805.7

4.4

818.4
24.2 2,624.1

734
568
1,302

1,285
2,587

£2.6bn

Portfolio valuation

Annual Report 2020  Great Portland Estates 71

 
 
 
 
Our portfolio continued

The Time is Now
Committed to a sustainable London

In May 2020, we launched our sustainability Statement 
of Intent ‘The Time is Now’ which is underpinned by 
four pillars with commitments that we will:

 – decarbonise our business to become net zero by 2030;

 – design climate change resilient and adaptable spaces; 

 – create a lasting positive social impact in our 

communities; and

 – put health and wellbeing front and centre.

Never has it been more important to address climate risk; 
nor has the link between the environment, social impact 
and health and wellbeing been more evident. Last year, 
recognising the increased urgency of the climate crisis, 
we set challenging targets to:

1.   reduce the energy intensity of our occupied portfolio 

by 40% and carbon emissions by 69% by 2030, 
including occupier consumption;

2.   create net zero carbon new build developments 

from 2030; and

3.   set out our timescales and approach to becoming 

a net zero carbon business.

Targets are meaningless unless they are embedded 
throughout the organisation and shape behaviour. 
Accordingly, during the year we incorporated our energy 
intensity target into our ESG-linked revolving credit facility, 
along with targets to reduce embodied carbon of our new 
developments and major refurbishments by 40% by 2030 
and to improve biodiversity net gain across our portfolio 
by 25% by 2030. Looking forward, the rate of interest 
we pay on this facility will depend on our performance 
against these targets. 

Furthermore, these targets have been included within the 
objectives of a number of our senior management team 
and will be used to assess levels of future remuneration. 
 › See more on our KPIs on pages 18 to 19

These four pillars are supported by our review of material 
risks undertaken last year, and align with the four UN 
Sustainable Development Goals we identified as resonating 
most with our business. 

We are committed to ensuring that our buildings are 
designed and managed to support the mental health 
and wellbeing of our employees, occupiers and our 
local communities.

Air quality is a significant issue for London and for 
ensuring health and wellbeing. Our Statement of 
Intent sets out how we are considering outdoor and 
indoor air quality and putting health and wellbeing 
front and centre.

Our targets to reduce the energy intensity and 
carbon intensity of our occupied portfolio now 
included within our ESG-linked RCF will help us to 
drive carbon emissions down. 

Through the installation of renewable energy and 
the use of technology to improve targeting and 
monitoring of energy consumption, we are making 
our buildings more sustainable.

We are focused on ensuring a lasting positive impact 
for the communities in which we are working and 
have committed to contributing £10 million of social 
value by 2030.

We recognise the role we have to play in reducing 
carbon emissions. We have therefore committed to 
decarbonising our business by 2030.

72

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Decarbonise our business by 2030 

The built environment is estimated to contribute around 
40% of the UK’s carbon emissions. The real estate industry, 
therefore, has an obligation to address its carbon footprint. 

Maintaining year on year reductions in embodied carbon 
will only be achieved through the use of new technology, 
alternative materials and innovative building techniques, 
whilst implementing principles of the Circular Economy. 

Our approach to decarbonising our business starts with 
maximising the energy efficiency of our buildings. 

We already purchase 100% of our electricity and gas on 
renewable tariffs, however, we need to significantly reduce 
consumption. During the year our like-for-like energy 
consumption decreased by 6%. However, to enable us to 
deliver sustained year on year improvements in energy 
efficiency, and to meet our energy intensity and carbon 
intensity reduction targets, we will need to work closely 
with our occupiers and supply chain partners to reduce the 
amount of energy we collectively consume.

The Design for Performance initiative is an industry funded 
project, backed by the Better Buildings Partnership to tackle 
the performance gap between design intent and actual 
performance of buildings once in operation. 

As a ‘Design for Performance Pioneer’, we have been able 
to see first-hand the benefits that the scheme will bring 
in delivering improved building energy performance 
through enhanced energy modelling, building handover 
and commissioning processes across the industry. We have 
therefore mandated ‘Design for Performance’ for our major 
refurbishments and new developments to ensure that, once 
in use, our buildings perform as efficiently as designed. 
Whilst energy efficiency is our first priority, the installation 
of on-site renewable and low carbon energy technology, 
supported by local energy generation solutions, will help 
to further decarbonise our portfolio. 

As a developer, embodied carbon is a significant proportion 
of our carbon footprint, accounting for more than a third of 
our footprint during the last financial year. We have therefore 
responded to the World Green Building Council’s call for 
action on embodied carbon and the RIBA climate challenge, 
committing to reducing our embodied carbon emissions 
by 40% by 2030. 

Only once building energy efficiency measures, embodied 
carbon reductions and renewable energy installations 
have been addressed will we consider offsetting the 
residual carbon. 

During the year we also signed the Better Buildings 
Partnership ‘Climate Change Commitment’. This commits 
us to publishing our net zero carbon roadmap by the end 
of 2020, and tracking our progress against the roadmap on 
an annual basis. We expect to complete our roadmap by 
autumn 2020, which will also include further detail on our 
approach and the scope of our net zero carbon commitment 
and the circumstances under which we may choose to 
offset emissions. 

Design climate resilient and adaptable spaces

In order to improve the climate resilience of our buildings, 
we need to transition away from reliance on fossil fuels, retrofit 
biodiversity measures to our existing buildings and ensure 
that we are designing for longevity. As part of our Statement 
of Intent, and included within the targets of our ESG-linked 
RCF, we have committed to improving biodiversity net gain 
across our portfolio by 25% by 2030. Nature-based solutions 
such as biodiverse roofs, green walls, trees and pocket parks 
all help to reduce the urban heat island effect, contributing 
to climate change resilience as well as improving external 
air quality and supporting the health and wellbeing of the 
local community. We will also prioritise the installation of 
renewable energy systems. 

The Better Buildings Partnership Climate Change 
Commitment requires us to develop a comprehensive 
climate resilience strategy for our portfolio. We already 
have processes in place to address and manage climate risk 
(see page 84 on our principal risks and our disclosure in line 
with the recommendations from the Task Force on Climate 
Related Financial Disclosures on page 77), and we are working 
to address these obligations in full with our strategy due to 
be released in 2022 in line with our commitments.

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Never has it been more important to address 
climate risk; nor has the link between the 
environment, social impact and health and 
wellbeing been more evident. The Time is 
Now sets out the four pillars of our approach, 
because if not now, when?” 

Janine Cole 
Director of Sustainability and Community

100%

Energy purchased on renewable tariffs

Annual Report 2020  Great Portland Estates 73

 
 
 
 
Our portfolio continued

Creating a lasting positive social impact 
By investing in local initiatives and maximising social value, we 
create more attractive places that are sustainable in the long 
term. As part of our commitment to creating a lasting positive 
social impact on our local communities, we have committed 
to generating £10 million of social value over the next ten 
years. We will achieve this through the implementation of 
our Social Value Guidelines, which ensure that we monitor, 
manage and measure the social impact of our refurbishment 
and development activities. 

Putting health and wellbeing front and centre 
A sustainable building should also contribute to the wellbeing 
of its occupiers and the local community, supporting 
healthier, happier and more productive lives. We know, 
through our review of material risks undertaken last year, 
that wellbeing is one of our top three most material issues. 
Focus is expected to continue to grow in this area following 
the COVID-19 outbreak and we are already responding to 
revised guidelines issued by industry groups on internal 
air quality. 

The COVID-19 outbreak has demonstrated the inextricable 
link between the environment and social impact, with 
communities placing a much greater value on health and 
wellbeing than ever before. We will therefore continue to 
invest in improved air quality, urban greening and biodiversity 
and support charities and organisations that support the 
maintenance and creation of green spaces in London. 

Our Community Fund, created this year in response to 
COVID-19, will focus on the most vulnerable groups within 
London who have been severely impacted by the pandemic, 
focusing on the homeless and other vulnerable groups, 
mental health and wellbeing and educational initiatives. 
Donations will be made both to support the immediate 
response and longer-term recovery.
 › See more about our stakeholder relationships on  

pages 58 to 66 and our Community Impact Report at  
www.gpe.co.uk/our-relationships/local-communities

Our Wellbeing brief integrates our approach 
to health and wellbeing, from the earliest 
design stages of our developments and 
refurbishments through to the operation 
of our buildings, enabling us to respond 
to growing occupier requirements.” 

Kulbir Bhatti
Sustainability Manager

During the year, we launched our Wellbeing Brief and we 
are using this to create flexible, inclusive and accessible 
spaces that benefit the wellbeing of our occupants and 
the community. 

We take an integrated and inclusive approach to ensure that 
relevant and applicable health and wellbeing aspects are 
considered during the design process and consider:

 – indoor air and water quality;

 – thermal, visual and acoustic comfort;

 – biodiversity and access to nature; and

 – healthy behaviours.

We integrate core requirements from wellbeing accreditation 
standards such as Fitwel and the WELL Building Standard 
to ensure that occupiers can obtain full certification for 
their spaces should they wish to do so, once their fit-outs 
are complete. 

We also look to retrofit our existing buildings to improve 
wellbeing, working with our occupiers to implement 
additional facilities and services where possible, creating 
new outdoor spaces, improving biodiversity and retrofitting 
cycle and shower facilities. Our smartphone app ‘sesame’, 
which has recently been rolled out across our portfolio also 
includes features to support the wellbeing of our occupiers. 

Our health and wellbeing approach is not limited to our 
buildings. We actively promote initiatives to support the 
health and wellbeing of our people, local communities and 
supply chain partners, working to support mental health 
initiatives and ensure ethical labour practices. 
 › See more about our culture and people on pages 46 to 53 

£10m

Social value to be generated by 2030

74

Great Portland Estates  Annual Report 2020

Progress on building certification
We continue to work to improve the number of our buildings 
rated for their sustainability credentials. 

There are significant limitations of Energy Performance 
Certificates (EPCs) as they do not reflect the actual energy 
performance of our buildings. The Real Estate Energy 
Benchmark (REEB) collated by the Better Buildings 
Partnership demonstrated the lack of correlation between 
EPC and actual energy performance once more this year. 
However, in line with current legislative requirements and 
government proposals on the future trajectory for minimum 
energy efficiency standards we are actively managing 
ratings, seeking to improve EPC ratings by at least one 
grade following refurbishment. 

As illustrated in the chart below less than 0.2% of our rated 
properties has an EPC rating below an E. Where we have 
refurbishments or developments on site, the targeted ratings 
have been indicated. 

Unrated managed buildings are currently under review 
following the expiry of the original EPC certificate and new 
ratings will be obtained once ongoing works to improve 
energy performance are completed. 

To supplement EPC ratings we use a variety of sustainability 
certification schemes and use the most appropriate system 
for the type and scale of the project including BREEAM, 
the RICS led SKA Rating system and residential schemes 
such as the Code for Sustainable Homes. Today 22% of our 
portfolio by area is rated BREEAM ‘Very Good’ or ‘Excellent’ 
with a further 11% currently on site with BREEAM ‘Excellent’ 
targeted. 

Our substantial development pipeline (56% of today’s 
portfolio by floor area) is largely unrated in its present 
form. However we will be aiming to significantly improve 
the environmental performance through development or 
refurbishment works and expect a BREEAM ‘Excellent’ 
rating of this element of the portfolio by 2030. A further 
14% of our portfolio is SKA rated, a rating scheme, 
which is typically used for floor by floor refurbishment as 
opposed to whole building performance and therefore is 
more commonly used by us for retrofit projects. For more 
information see our Sustainability Data Performance report 
at www.gpe.co.uk/sustainability/our-performance.

EPC ratings: percentage of portfolio (by sq ft) (%)

Percentage of current floor area certified to date (%)

30

25

20

15

10

5

0

25.2

15%

18%

11.0

0.2
15.1

5.6

6.6

6.6

4.9

A

B

C

D

E

17.6

7.1

40%

–

F

0.1

G

Managed 
portfolio
uncertified

Uncertified
 FRI

Current ratings

Targeted: under development

14%

13%

BREEAM Rated
SKA Rated
Committed Schemes
Managed portfolio uncertified
Uncertified FRI

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Annual Report 2020  Great Portland Estates 75

 
 
 
 
Our portfolio continued

Streamlined Energy and Carbon Reporting (SECR) disclosure
Our SECR disclosure presents our carbon footprint across Scopes 1, 2 and 3, together with an appropriate intensity metric 
and our total energy use of electricity and gas.

Gross Internal Floor Area (m2)
Scope 1 emissions and direct energy use
Emissions associated with combustion of fuel (tCO2e)
Emissions associated with operation of facilities (refrigerant gas) (tCO2e)
Energy use of combustion of fuel (kWh)
Scope 2 emissions and indirect energy use 
Emissions associated with purchased electricity, heat, steam and cooling usage (tCO2e)
Emissions associated with head office electricity usage (tCO2e)
Energy use of purchased electricity, heat, steam and cooling (kWh)
Energy use of electricity at head office (kWh)
Scope 3 emissions and indirect energy use
Emissions associated with purchased electricity sub-metered to occupiers (tCO2e)
Energy use of purchased electricity sub-metered to occupiers (kWh)
Emissions and energy use totals
Absolute emissions (tCO2e)
Total energy use (kWh)
Intensity measures
Emissions per m2 gross internal area (tCO2e/m2/year)
Energy use per m2 gross internal area (kWh/m2/year) 
Emissions and energy use totals like-for-like
Absolute emissions on a like-for-like basis (tCO2e)
Energy use on a like-for-like basis (kWh)
Intensity measures like-for-like 
Emissions per m2 gross internal area on a like-for-like basis (tCO2e/m2/year)
Energy use per m2 gross internal area on a like-for-like basis (kWh/m2/year)

2020

189,306

1,807
1.9
9,826,113

3,207
48
12,734,121
187,803

2019

192,745

2,311
320.0
12,564,341

3,469
52
12,440,093
184,055

5,150
20,147,359

5,775
20,401,351

10,211
42,895,396

11,608
45,589,840

0.0539
226.59

0.0602
236.53

9,851
41,217,755

11,286
44,136,443

0.0572
240

0.0656
256

During the year our like-for-like energy consumption decreased by 6%, this was due to extensive works undertaken to 
replace boilers and reduce plant run times at 200 Gray’s Inn Road. Due to the proportion of our energy consumption that is 
attributable to this building, the works undertaken have had a significant impact on overall portfolio energy reduction. 

As part of requirements under Phase 2 of the Energy Savings Opportunity Scheme (ESOS) we also conducted twelve energy 
audits of our highest consuming properties. The process identified 3,771 mWh of potential energy savings. These are being 
incorporated within the Energy Action Plans for the relevant buildings. We are also undertaking more in-depth audits at 
properties where energy consumption is highest to allow us to plan for longer-term retrofit plans and align with our net zero 
carbon ambitions. At 200 Gray’s Inn Road, this process is being undertaken jointly with our occupiers to understand how we 
can work together to reduce consumption. Our energy working group oversees operational energy improvements.

Independent assurance
Independent assurance is provided by Deloitte LLP in accordance with the International Standard on Assurance Engagements 
(ISAE3000). 

Our methodology
For our SECR disclosure we have used the operational control consolidation method, as this best reflects our property 
management arrangements and our influence over energy consumption. Included in our operational control data are 
emissions and energy usage from our managed properties (including 100% of emissions from joint venture properties) and 
head office usage. Where we have purchased energy, which is sub-metered to occupiers, this is itemised separately. We have 
not included usage or emissions from our development sites or for FRI let properties as these fall outside our operational 
control. Emissions from our development sites are reported on our website www.gpe.co.uk/sustainability/.

We have used DEFRA Environmental Reporting Guidelines and the Greenhouse Gas Protocol to calculate our emissions. 

Our full Annual Sustainability Performance Data Report, aligned with EPRA Sustainability Best Practice Recommendations, 
can be found at www.gpe.co.uk/sustainability/our-performance/.

76

Great Portland Estates  Annual Report 2020

Task Force on Climate-Related Financial Disclosures (TCFD)
We are making good progress incorporating the findings of the Task Force on Climate Related Financial Disclosures 
within our business and reporting. A summary in line with TCFD guidelines is provided below. For more on our approach 
to risk see pages 80 to 93 and pages 97 to 109 for Board activities. A more detailed disclosure in line with TCFD is available 
on our website at www.gpe.co.uk/sustainability.

Governance

Board oversight of climate-related 
risks and opportunities

Sustainability updates are regularly provided at scheduled Board meetings with formal updates 
provided on a six-monthly basis.

Management role in assessing 
and managing climate-related 
risks and opportunities

The Sustainability Committee, chaired by our Chief Executive, meets quarterly and is attended 
by a number of the Senior Management Team. Regular sustainability updates are also provided 
to the Executive Committee and Board.

Strategy

Climate-related risks and 
opportunities over short, 
medium and long term

Impact of climate-related risks  
and opportunities on the 
organisation’s businesses, 
strategy and financial planning

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1-3 years

Short term 
Rapidly evolving legislation including the implementation of Minimum Energy Efficiency 
Standards, tightening of regulations and potential introduction of ‘In-use’ building performance 
ratings increases the running costs of our portfolio.

3-7 years

Medium term 
The need to decarbonise and adapt to climate change may give rise to higher market demand 
for buildings with improved sustainability credentials and greater energy efficiency. This may 
lead to environmentally stranded assets that are no longer fit for purpose and provide an 
opportunity for us to deliver buildings that meet this need.

Long term 
Speed of market transformation and technological progress may impact on our ability to 
decarbonise our business. 

7-15 years

Greater demand for buildings that have been adapted to accommodate the likely impact of 
climate change, including (within London) higher temperatures and an increase in extreme 
weather events, including flooding and water shortages.

Climate-related risks and opportunities will impact how we develop, refurbish and manage 
buildings in addition to shaping the nature of the buildings that we acquire and sell. 

As part of the completion of our net zero carbon roadmap we are modelling:

 – financial impact and payback of energy efficiency measures;
 – impact on development appraisals of designing net zero carbon buildings;
 – likely cost of carbon offsetting; and
 – the impact of carbon pricing.

Resilience of organisation’s 
strategy taking into account 
different climate-related scenarios

Physical risks will impact on the costs of maintaining and developing our buildings. 

Our Statement of Intent lays out a clear strategy for dealing with both mitigation of climate 
change and adaptation to the effects of climate change.

Our targets support our trajectory to decarbonise our business by 2030.

Risk management

Integration of processes for 
identifying, assessing and 
managing climate-related risks 
into overall risk management

Metrics and targets

Metrics used to assess climate-
related risks and opportunities 
in line with strategy and risk 
management processes

Disclosure of Scope 1, 2 and 
where appropriate Scope 3 
and related risks

Targets used by the organisation 
to manage climate-related 
risks and opportunities and 
performance against targets

The Executive Committee, Audit Committee and the Board formally review the Group’s 
principal risks. This includes climate-related risks, including their likelihood, impact and 
mitigating controls, which are managed by the Sustainability Committee.

We report on a number of metrics (see below); we have recently announced our intention 
to decarbonise our business by 2030 (see page 72); and our ESG-linked RCF also contains 
a number of climate-related metrics (see page 78).

Metrics in connection with climate-related risks including Scope 1, 2 and 3 emissions are reported 
within our Streamlined Energy and Carbon Reporting and within our Annual Sustainability 
Performance Data Report at www.gpe.co.uk/sustainability/our-performance/ which is aligned 
with EPRA Sustainability Best Practice Recommendations.

See our Statement of Intent at www.gpe.co.uk/sustainability/our-sustainability-statement-
of-intent/ and the targets included in our ESG-linked RCF at www.gpe.co.uk/investors/debt-
information/revolving-bank-facility for further details.

Annual Report 2020  Great Portland Estates 77

 
 
 
 
2020

2019
16.2% 6.8%
14.2% 8.7%
n/m

n/m

£411m £608m

2.2% 2.7%

22.0p

19.5p

Innovative 
ESG-linked 
refinancing

We are constantly on the lookout for ways to further 
enhance our capital structure and, in the summer of 
2019, we identified a potential opportunity to ‘Amend 
and Extend’ our key £450 million revolving credit facility 
(RCF) by linking it to our sustainability strategy, extending 
its maturity and lowering its cost. We were delighted to 
receive the support of our lenders and completed the 
transaction in January 2020 with a group of five existing 
relationship banks. The £450 million size of the RCF 
has been maintained, and its slightly reduced headline 
margin of 90 basis points (previously 92.5 basis points) is 
subject to adjustment from May 2021, depending on our 
performance against three challenging ESG-linked KPIs 
which align with our ambitious sustainability strategy. 
The facility now has a January 2025 initial maturity date 
which can potentially be extended to January 2027, 
subject to bank consent. This is the first ESG-linked RCF 
to be issued by a UK-REIT and the financial effect of all 
margin adjustments will be given to registered charities 
focused on environmental initiatives.

Our capital strength

Introduction 
Our strategy is underpinned by 
a consistent combination of low 
financial leverage and capital 
allocation discipline, demonstrated 
by our LTV today of 14.2% and 
£616 million of surplus equity returned 
to shareholders in recent years.

Operational measures

Net gearing
Loan to value
Interest cover
Cash and undrawn 
facilities
Weighted average 
interest rate
EPRA earnings 
per share

Our approach
While our primary objective is to deliver returns consistently 
ahead of our cost of capital, we also seek to minimise the 
cost of our capital through the appropriate mix of equity 
and debt finance, and to ensure that we have access to 
sufficient financial resources to implement our business 
plans. Optimising and flexing the allocation of capital 
across our portfolio, including between our investment and 
development activities, is key to our business and ensuring 
that we maximise returns on a risk adjusted basis through the 
property cycle. Accordingly, we operate with four key ‘givens’: 

 – conservative leverage to enhance, not drive, returns;

 – sustainable ordinary dividends;

 – disciplined capital allocation; and

 – balance sheet efficiency – track record of accretively 

raising and returning capital.

Our preference for low financial leverage helps to provide 
downside protection when operating in the cyclical central 
London property market and to maintain the financial 
flexibility to allow us to act quickly on new investment 
opportunities as they arise.
 › See more about our approach to risk on pages 80 to 94

Our financial position is very strong, 
with plenty of low cost, flexible firepower. 
We have sought to actively manage our 
capital structure over the year, and in 
particular our refinancing transactions 
included issuing the first ESG-linked 
RCF by a UK REIT.”

Martin Leighton 
Director of Corporate Finance

78

Great Portland Estates  Annual Report 2020

Our balance sheet is in extremely good shape. With a 
loan to value ratio of just 14.2% and £411 million of 
cash and undrawn bank facilities, we are very well 
positioned to fund our committed capex programme 
and any additional opportunities which may arise. 

Innovative structuring, reducing interest costs 
and extending maturities 
The Group’s sources of debt funding are diverse, both 
secured and unsecured, and include the public, private and 
bank markets. Our debt providers are key stakeholders in our 
business and are a mix of UK and overseas banks, together 
with overseas life insurance companies and pension funds. 

Our financing activity this year focused on proactively further 
enhancing our debt book. In January 2020, we entered into 
a £450 million ESG-linked unsecured revolving credit facility 
(RCF) with a headline margin of 90 basis points over LIBOR 
and an initial five-year term which may be extended to a 
maximum of seven years, subject to bank consent. This is 
the first RCF issued by a UK-REIT which is ESG-linked, such 
that its margin is subject to adjustment depending on our 
performance against three challenging ESG-linked KPIs. 
In a further innovation, the financial effect of all margin 
adjustments will be given to registered charities focused on 
environmental initiatives. The new facility is an amendment 
and extension of a £450 million RCF which had a headline 
margin of 92.5 basis points and was due to mature in 2024. 

Our debt maturity profile was further enhanced in September 
2019 by the prepayment of a £90 million secured loan issued 
by the Great Ropemaker Partnership which was due to expire 
in December 2020. 

At 31 March 2020, 69% of our total drawn debt and 43% of 
our total committed debt was from non-bank sources (March 
2019: 88% and 40% respectively), with 69% of our debt book 
being fixed rate or hedged (March 2019: 100%). We have 
substantial headroom above our Group debt covenants and 
values could fall by 70% before a breach. Due in part to both 
our very low levels of low cost debt and the treatment of 
capitalised interest under our Group covenants, our interest 
cover ratio for the year was once again not measurable. 

As noted above, we have no near-term Group level debt 
maturities and our low loan to value ratio of just 14.2% feels 
appropriate given current market uncertainties. 

Balance sheet discipline and £200 million 
share buyback 
When considering the appropriate level of financial leverage 
in the business, we apply the same capital discipline that we 
use when making asset level decisions. Typically, we aim for 
a loan to value ratio of between 10%-40% through the cycle 
and today we are at the lower end of the range given our 
portfolio activities and market cycle position. Additionally, 
we have a track record of accretively raising and returning 
equity capital to shareholders at the appropriate time and in 
the appropriate circumstances. Our key considerations when 
making such capital decisions include:

 – the market outlook;

 – opportunities for growth (both capital expenditure 

and acquisitions);

 – opportunities for profitable recycling activity; and

 – current and prospective debt ratios (including LTV 

and interest cover).

Ample liquidity and flexible, low cost debt book
At 31 March 2020, we had £411 million of cash and undrawn 
committed debt facilities with no Group level debt maturities 
until 2024, giving us very significant financial firepower 
for the future. Furthermore, due to market uncertainty 
caused by COVID-19, we increased the drawn position on 
our £450 million unsecured revolving credit facility, from 
£66 million to £150 million in March 2020, with our cash 
on deposit of £111 million at 31 March 2020 comfortably 
exceeding our committed capex to come.

The most recent application of this disciplined approach 
is our £200 million return of surplus equity by way of an 
on-market share buyback programme, which completed in 
November 2019. Over the entire programme, we repurchased 
and cancelled 27.8 million shares at average share price 
of £7.20 (or £7.25 per share, £201.5 million including costs). 
This included 17.5 million shares at an average share price 
of £7.19 (or £7.23 per share, £126.7 million including costs) 
during the year ended 31 March 2020.
 › See more about our financial results on page 45

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LTV and liquidity (years to March)

Liquidity (£m)

LTV %

900

800

700

600

500

400

300

200

100

0

25.7%

21.8%

814

17.4%

18.3%

607

508

479

442

378

8.7%

14.2%

411

2014

2015

2016

2017

2.4%
2018

2019

2020

30

25

20

15

10

5

0

£616m

Returned to shareholders in last three years

Annual Report 2020  Great Portland Estates 79

 
 
 
 
Our approach to risk

The successful management of risk is critical for the 
Group to deliver its strategic priorities. Whilst the 
ultimate responsibility for risk management rests with 
the Board, the effective day-to-day management 
of risk is integral in the way we do business and 
the culture of our team. Our attitude to risk is one 
of collective responsibility with the identification 
and management of risks and opportunities part of 
the mindset of the GPE team. Our organisational 
structure, including close involvement of senior 
management in all significant decisions and in-house 
management of all development, portfolio and 
occupational service activities, together with our 
prudent and analytical approach, is designed to align 
the Group’s interests with those of shareholders.

Setting and monitoring our ‘risk appetite’ 
The Group’s overarching risk appetite is set in the context 
that we focus on a single market, that of central London, 
operating out of a single head office within close proximity to 
all of our activities. Central London’s real estate markets are 
highly cyclical and, as a result, we apply a disciplined approach 
to our capital allocation and managing our operational risk, in 
particular our development exposure, in tune with prevailing 
market conditions. Furthermore, we aim to operate with low 
financial risk through maintaining conservative financial leverage. 

We use a suite of key operational parameters as an 
important tool to set and then measure the Group’s risk 
profile. These parameters consider, amongst other matters, 
the Group’s size, financial gearing, interest cover, level of 
speculative and total development exposure, and single asset 
concentration risk. These parameters are revisited annually 
as part of the Group’s Strategy Review and reviewed at each 
Board meeting. We monitor the Group’s actual and forecast 
position over a five-year period against these parameters.
 › See more details on our operational measures on pages 18 and 19

Our risk culture and how we manage our risks 
Our over-arching risk management process is comprised 
of four main stages as summarised in the diagram below.

We believe that effective management of risk is based on 
a ‘top-down’ and ‘bottom-up’ approach with appropriate 
controls and oversight as outlined on page 81, which include: 

 – our strategy setting process; 

 – the quality of our people and culture; 

 – established procedures and internal controls; 

 – policies for highlighting and controlling risks; 

 – regular oversight by the relevant Committees and the 

Board; and 

 – a clear reading of market conditions and the property cycle. 

Moreover, risk management is an integral part of all our 
activities. Risks and, more positively, where these might 
also provide opportunities, are considered as part of every 
business decision we make and how they would affect the 
achievement of our strategic priorities and the long-term 
performance of our business. 

Six-monthly assessment of principal and emerging 
risks, opportunities and effectiveness of controls
As part of a robust assessment of the principal and emerging 
risks facing the Group, at the half-year and year end, the 
Executive Committee, the Audit Committee and the Board 
formally review the Group’s principal and emerging risks, 
including those that would threaten its business model, future 
performance, solvency and liquidity. Importantly, part of this 
review is the consideration of:

 – the internal operational controls in place to mitigate the 
principal risks and how key controls over these risks have 
operated in the preceding six months; 

 – consideration of any emerging risks and opportunities; and

 – the Board’s ongoing monitoring of the principal risks. 

Whilst emerging risks and opportunities are considered as 
part of this formal six-monthly assessment, the Board spends 
additional time at scheduled Board meetings on ‘blue sky’ 
thinking and consideration of possible emerging risks. As part 
of this process, the Executive Committee members are tasked 
to provide a summary at each scheduled Board meeting of the 
three ‘things’ concerning and exciting them most. We also 
ask our Heads of Department the same question to ensure 
that we are continually challenging ourselves as to how we 
should evolve. Emerging risks are also specifically considered 
by the Board as part of its annual Strategy Review. While risks 
relating to structural retail and market changes, pandemic 
and short and medium-term climate change risks have been 
captured within our re-framed principal risks, we have also spent 
time this year discussing emerging risks across a number themes 
such as long-term climate change and advances in technology.

Risk monitoring, reporting 
and escalation
 – Risks documented, reported and monitored 

on a regular basis by management, Executive 
Committee, Audit Committee and Board

 – New risks and significant changes to risk 

profiles escalated as appropriate

Risk response
 – Appropriate response determined 

with reference to risk appetite

 – Risk response may include Treat, 
Transfer, Terminate or Tolerate

4

1

Communication 
and 
consultation

3

2

Risk identification
 – Identification and description of significant 
and emerging risks that could affect GPE’s 
key objectives

 – Risks categorised with assignment of 

accountabilities and Executive ownership 
of principal risks 

Risk assessment
 – Potential impact and likelihood of 
risk assessed using defined criteria

 – Principal risks assessed on a gross, 

net and target risk basis

80

Great Portland Estates  Annual Report 2020

Board oversight of risk

Board

Nomination Committee

Audit Committee

Remuneration Committee

Executive Committee

Operational Committee oversight

Weekly

Development management 

Portfolio management 

Investment management

Financial management

Quarterly

Living our values

Health and safety

Development management review 

Portfolio management review 

Sustainability

Community

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People and culture 
guided by our values

Procedures and  
internal controls

Policies for highlighting 
and controlling risk

Focused market  
expertise

Open communication

Transparent disclosure  
with stakeholders

Integrity in business conduct

Interests aligned  
with shareholders

Qualified and  
experienced personnel  
with specific roles

Intense development,  
portfolio management  
and occupational  
services teams

Conservative attitude  
to capital deployment

Analytical rigour

High level risk assessment  
framework

Strict approval requirements 

Extensive documentation  
to support decisions 

Formal policies and procedures  
consistently applied

Defined performance 
indicators with sensitivity analysis

External review  
of key controls/internal audit

Whistleblowing policy

Business risk

Investment return  
benchmarks

Debt leverage,  
covenant compliance  
and liquidity limits 

Regular review  
of business plans,  
dashboard lead  
indicators and  
operational parameters 

Occupancy targets 

Development appraisal  
parameters 

Leasing objectives  
and occupier  
covenant testing

Annual Report 2020  Great Portland Estates 81

 
 
 
 
Our approach to risk continued

During the year, the Audit Committee and Board have 
taken the opportunity to oversee an in-depth review of 
GPE’s principal risks:

 – to ensure that the principal risks continue to reflect the 
most significant risks facing the business at the current 
time, particularly in the face of an evolving real estate 
industry and market, ongoing macro-economic and 
political uncertainties as well as, more recently, the 
uncertainties arising from the COVID-19 crisis;

 – to more closely reflect how GPE’s risks are being 

discussed and considered across the organisation 
and in the context of GPE’s strategic priorities;

 – to simplify and consolidate risks where considered 

appropriate; and

 – to further consider and identify possible emerging risks.

As a consequence of this exercise, we have re-framed 
the descriptions of GPE’s principal risks, identified two 
new principal risks and escalated the status of certain 
risks that were previously captured within a broader 
principal risk description. Save for the new or escalated 
risks explained below, the risks to the business, at a high 
level, remain broadly unchanged from the previous year, 
the key changes being as follows:

 – inclusion of a new pandemic risk given the continuing 
risks arising from the current COVID-19 crisis, the full 
extent of the humanitarian, societal and economic 
impacts of which are still too early to judge;

 – as a result of a perceived greater risk arising from 

the impact of ongoing structural changes in the retail 
industry on the demand for, and profitability of retail 
space in central London, we have added ‘Structural 
retail changes’ as a separate principal risk;

Net risk heatmap

Principal risk

 – increasing regulation and stakeholder, occupier and public 
expectations make our response to the climate change 
challenge a commercial and reputational imperative which 
is likely to impact how we operate in the future. ‘Climate 
change and decarbonisation’ has therefore been recognised 
as a separate principal risk as well as an emerging risk;

 – an increasingly stringent planning environment as a result 
of political and economic uncertainties, increased focus 
on the provision of affordable housing in certain London 
boroughs, recommendations following the Grenfell Tower 
fire and evolving environmental requirements have resulted 
in ‘Challenging planning environment’ being separated out 
as a standalone principal risk; and

 – other risks have been simplified or consolidated where these 
are considered to be a sub-set of a single broader principal 
risk. For example, the risks of poor management of voids, low 
occupier retention and occupier failures or dissatisfaction 
are now considered to be part of a broader risk of ‘Meeting 
occupier needs and competition’. Similarly, risks relating to 
central London performance, macro-economic conditions 
such as Brexit, civil unrest and terrorism have been combined 
under a single risk relating to ‘London attractiveness’.

A description of the Group’s principal risks, together with a 
summary of steps taken to mitigate those risks, is shown on 
pages 84 to 93. Given the above changes to our principal risks, 
the risk movements do not show the year-on-year assessment 
changes of each risk but instead reflect the Board’s view of the 
directional change of the re-framed risks over that period.

As we continue to review our strategy in the context of a 
changing market, the impacts of the COVID-19 crisis and 
macro-economic uncertainties, we will continue to assess our 
risk appetite and target for each risk as part of our strategy 
review process. The Board has assessed the likelihood and 
impact of the revised principal risks, the net risk assessments 
for which are shown in the heatmap below. 

Structural retail changes

Pandemic
London attractiveness
Property market dislocation and impact on financial leverage
Failure to maximise returns from prevailing market conditions
Failure to profitably deliver the development programme

1
2 Climate change and decarbonisation
3
4
5
6
7
8 Challenging planning environment
9 Attract and retain the right people 
10 Meeting occupier needs and competition
11 Poor capital allocation decisions
12 Health and safety
13 Cyber security and infrastructure failure

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Risk severity

Negligible

Minor

Moderate

Major

IMPACT

Low

Medium

High

Very high

Net risk rating as assessed after existing controls and mitigation

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Great Portland Estates  Annual Report 2020

 
The Board’s ongoing monitoring of the Group’s 
principal risks and controls
Ongoing monitoring of our principal risks and controls 
by the Board is undertaken through: 

 – relatively low levels of authority for transactions 

requiring Board approval, with investment transactions and 
development approvals requiring, amongst other matters, 
consideration of the impact on financial leverage, interest 
cover and portfolio risk/composition; 

 – the Executive Committee’s oversight of all day-to-day 

significant decisions; 

 – the Chief Executive reporting on the market conditions 
dashboard, operational parameters and people as 
appropriate at each of the scheduled Board meetings; 

 – members of the Executive Committee providing a review 
of the development programme, occupational markets 
and key property matters at each of the scheduled 
Board meetings; 

 – the Finance and Operations Director reporting on Group 

forecasts, including actual and prospective leverage 
metrics, the occupier watch list and delinquencies, cyber 
and IT initiatives, sustainability and health and safety 
matters at scheduled Board meetings; 

 – continuing to crystallise profits through the sale of 24/25 
Britton Street for a headline sale price of £64.5 million; 

 › See more on page 33

 – maintaining our low financial leverage whilst returning 

£125.9 million to shareholders through our share 
buyback programme; 
 › See more on pages 78 and 79

 – given our risks of ‘Failing to maximise returns from 

prevailing market conditions’ and ‘Meeting occupier needs 
and competition’, further developing our flex product and 
service offer and installing market-leading technology 
solutions across our portfolio, including our new app 
‘sesame’;

 › See more on pages 40, 41 and 69

 – launching our Inclusion and Diversity strategy and 

related initiatives and achieving the National Equality 
Standard accreditation;
 › See more on pages 50 and 51

 – in view of our ‘Decarbonisation and climate change’ risk, 
issuing the first ESG-linked bank facility by a UK REIT and 
committing to becoming a net zero carbon business by 
2030, launching our Statement of Intent ‘The Time is Now’;

 – the Executive Directors communicating with the Board 

 › See more on pages 72 and 78

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 – launching our inaugural Health and Safety strategy and 

strengthening our procedures across the portfolio;

 › See more on page 63

 – continued focus on our cyber governance both at head 
office and in relation to landlord IT equipment across 
our portfolio; and
 › See more on page 122

 – extensive engagement with stakeholders in order 
to manage and mitigate the impacts of COVID-19 
while supporting our stakeholders where we can. 

 › See more on pages 49 and 58 to 64

on any significant market and operational matters 
between Board meetings; 

 – senior managers attending the Board and Audit 

Committee meetings as appropriate to discuss specific 
risks either across the business, such as sustainability, 
health and safety and cyber, or relating to transactions; and 

 – the Audit Committee meeting with the valuers at least 

twice a year to better understand market conditions and 
challenge the assumptions underlying the valuation. 

Our focus during the year 
The continued challenging market conditions as a result of 
the uncertain economic and political environment associated 
with the UK leaving the European Union, and, more recently, 
the COVID-19 crisis, and how we have considered these 
in light of our business, is explained in more detail in ‘Our 
market’ on page 23 and our viability assessment on page 
94. In light of this ongoing uncertainty, the focus on our 
strategy and business model with a clear linkage of our risks 
to overarching strategic priorities and operational parameters 
have again this year been revisited at all our scheduled Board 
meetings. Areas of significant focus have included: 

 – the progress of our three developments at Hanover Square, 

W1, 1 Newman Street & 70/88 Oxford Street, W1 and 
The Hickman, E1;

 › See more on pages 34 to 36

 – the continued strong and pragmatic leasing activity across 
our development portfolio, including pre-lettings achieved 
at Hanover Square, W1 and at 1 Newman Street & 70/88 
Oxford Street, W1; 
 › See more on pages 34 to 36

Annual Report 2020  Great Portland Estates 83

 
 
 
 
Our approach to risk continued

How we manage principal risks and uncertainties

Link to 
strategic 
priorities

2

3

Principal risk

Structural retail changes

A continued structural shift in 
the retail industry could force 
changes to leasing requirements 
(e.g. turnover rents) and/or reduce 
the demand for, or profitability 
of retail space in central London. 
This could reduce rents, 
asset values and returns 
from retail space.

Climate change and decarbonisation

The need to decarbonise our 
business increases the cost of 
our activities through the need 
to retro-fit buildings to improve 
their sustainability credentials 
and reduces our ability to 
redevelop due to planning 
restrictions, increased regulation 
and stakeholder expectations, 
the increased cost of low carbon 
technology and potentially the 
pricing of carbon. Failure to meet 
the climate challenge could 
impact our ability to deliver new 
buildings, reduce the demand 
for the buildings we own, 
cause significant reputational 
damage and result in exposure 
to environmental activism and 
potentially stranded assets.

Pandemic

Ongoing pandemic (lasting longer 
than three months) could lead to 
a significant decrease in demand 
in our markets, adversely impact 
our rental income, reduce the 
availability of our workforce and 
disrupt our supply chains resulting 
in a decreased ability to maintain 
the consistency of our operations.

3

4

1

2

3

4

6

How we monitor and manage risk

Strategic financial forecasts updated prior to each Board meeting including scenario planning 
for different economic cycles.
Quarterly review of asset-by-asset business plans to assess potential exposures and inform 
hold/sell strategies.
Regular reporting to Executive Committee and Board on negotiations and 
marketing campaigns.
Regular updates received from central London retail agencies to understand current market 
trends and anticipating future changes to deal structures. 
The Group’s in-house portfolio management teams have proactive engagement with 
occupiers to understand their occupational needs and requirements with a focus on 
retaining income. 
Design Review Panel reviews building design and specification to ensure the scheme 
can accommodate flexibility of unit sizes appropriate for future retail occupier demand.
In-house Leasing and Marketing teams liaise with external advisors on a regular basis, 
creating marketing campaigns, agreed budgets and timelines in accordance with the  
leasing/marketing objectives.

Regular Board and Executive review of Sustainability policy and climate change commitments.
Sustainability Committee meets quarterly to consider strategy in respect of climate change 
and Environmental and Social strategy and risks.
Dedicated Director of Sustainability and Community and Sustainability Manager.
Design Review Panel reviews design brief for all buildings to ensure that forthcoming 
sustainability risks are considered.
Sustainable Development Brief and Sustainability strategy in place. 
ESG-linked RCF and the introduction of ESG strategic bonus measures for Executive 
Committee members to support delivery of decarbonisation within the business.
The creation of a baseline carbon position for existing near-term development schemes 
is currently underway.

Business Continuity Plans and IT Business Continuity Plans in place.
Response Committee established and led by the Finance and Operations Director to identify 
risks and concerns to help manage GPE’s response to COVID-19 crisis. Daily and weekly 
reporting to the Executive Committee. 
Regular Board calls held during COVID-19 crisis to review GPE’s response and mitigations with 
key updates provided between meetings. Reviews of Government guidelines and emerging 
practice with risk assessments undertaken as control measures change.
Enhanced stakeholder engagement, particularly with occupiers, contractors, shareholders 
and employees.
Selection of contractors and suppliers based on creditworthiness.

Near-term strategic priorities

1 COVID-19 response

2 Deliver and lease committed schemes

3 Prepare the pipeline

4 Progress sustainability agenda

5 Further embed values

6  Continue to grow flex offer

84

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Directional travel of 
net risk movement 
over the last 12 months

Commentary

Increasing

Increasing

Retail space comprises 28% of our portfolio by value. Whilst wider UK retailing has suffered from a combination of 
lower retail sales and a structural shift, as increasing volumes of sales move online, central London retail has to date 
demonstrated greater resilience, underpinned by tourism (both domestic and international), flagship stores, a deep 
cultural offering and its growing population. 
Moreover, we focus on delivering high quality, modern retail units into locations with enduring appeal with the bulk 
of our activities centred on the prime shopping streets of Oxford Street, Regent Street, Bond Street and Piccadilly. 
Our current development activity at Oxford House, at the eastern end of Oxford Street, and Hanover Square, at the 
northern end of Bond Street, aim to deliver new retail experiences into locations that will benefit from the expected 
opening of Crossrail in 2021. Early interest in the schemes has been encouraging and during the year we completed 
our first retail letting in our Hanover Square scheme.
However, the outbreak of COVID-19 and associated lockdown has made the position more challenging and rental 
values across our retail units fell 4.3% during the year.

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With the built environment contributing approximately 40% of the UK’s carbon footprint and the climate change 
debate moving from the periphery to now being both a moral and economic imperative, particularly for our occupiers 
and other stakeholders, we have been further expanding our sustainability commitments and activities. Having 
announced in 2019 targets to reduce energy intensity in our existing buildings by 40% (from a 2016 baseline) by 
2030 and to delivering net zero carbon new build developments from 2030, we have more recently articulated our 
approach to sustainability in our Statement of Intent ‘The Time is Now’, which includes a commitment to decarbonise 
our business to become net zero by 2030. We are also committing to design climate change resilient and adaptable 
spaces, create a lasting positive social impact in our communities and put health and wellbeing front and centre.
Moreover, with sustainability touching everything that we do, in early 2020 we incorporated our energy intensity target 
into our ESG-linked revolving credit facility, along with targets to reduce embodied carbon of our new developments 
and major refurbishments by 40% by 2030 and to improve biodiversity net gain across our portfolio by 25% by 
2030. As a result, the rate of interest we pay on this facility will depend on our performance against these targets. 
Furthermore, these targets have been included within the objectives of many of our senior executives and will be 
used to assess levels of future remuneration.
We also continue to work to improve the number of our buildings rated for their sustainability credentials. In line 
with current legislative requirements and Government proposals on the future trajectory for minimum energy 
efficiency standards, we are actively managing ratings, seeking to improve EPC ratings by at least one grade 
following refurbishment.
 › See more on page 77

The current COVID-19 pandemic is already having profound social and economic consequences. However, the 
resilience of our business, finances and people are already in strong evidence. We are engaging extensively with all 
our stakeholders, including offering assistance to our occupiers on a case by case basis, extending our community 
activities, including through the creation of a new Community Fund, and working hard to ensure the safety and 
wellbeing of our employees who have all been working from home since late March 2020.
All our properties have remained open and operating to Government guidelines, including our development sites. 
We have also issued to all our occupiers a ‘return to the office’ playbook.
None of our employees have been furloughed and the Group has no current plans to access any UK Government 
COVID-19 funding.

Increasing

Annual Report 2020  Great Portland Estates 85

 
 
 
 
Our approach to risk continued

How we manage principal risks and uncertainties continued

Link to 
strategic 
priorities

2

3

6

Principal risk

London attractiveness

The appeal of London to 
occupiers and investors may 
diminish due to macro-economic 
conditions (e.g. Brexit), the rise 
of alternative destinations for 
international trade, the impact 
of civil unrest and terrorism, the 
impact of long-term climate 
change (e.g. risk of flooding) and 
the relative expense of operating 
in London. This could result in a 
lack of investment and occupier 
demand leading to decreasing 
income and asset values.

How we monitor and manage risk

Board annual strategy review with regular economic and market updates received from 
third parties.
Strategic financial forecasts are updated prior to each Board meeting including scenario 
planning for different economic cycles and eventualities, including to reflect potential 
impacts regarding the UK’s exit from the EU and, more recently, broader economic 
recovery from the COVID-19 crisis.
Regular review of strategic priorities and transactions in light of the Group’s 
dashboard of lead indicators and operational parameters.
Detailed planning regarding the UK’s exit from the EU, with regular updates 
to the Board on GPE’s preparations and potential impacts. 
The Group aims to maintain a consistent policy of low financial leverage.

Property market dislocation and impact on financial leverage

Assets may reduce in value due to 
capital markets disruption and/or 
a macro-economic shock which 
could increase GPE’s financial 
leverage and potentially result in 
our breaching banking covenants.

2

3

6

Quarterly review of capital structure, including gearing levels, by Finance and Operations 
Director and Executive Committee. 
Board annual strategy review with regular economic and market updates received 
from third parties.
Regular review of strategic priorities and transactions in light of the Group’s dashboard 
of lead indicators and operational parameters.
Quarterly review of current and forecast debt, hedging levels and financing ratios 
under various market scenarios.
The Group aims to maintain a consistent policy of low financial leverage.
The Group’s funding measures are diversified across a range of bank and bond markets.
Regular review of financing by Finance and Operations Director and Executive Committee 
with reporting at each Board meeting.

Failure to maximise returns from prevailing market conditions

We fail to adequately read 
market conditions and respond 
accordingly. This could result 
in making leasing decisions or 
buying, selling or developing 
buildings at the incorrect 
time leading to insufficient 
returns on our investment. 
Additionally, in periods of 
stable markets we may fail 
to effectively adjust our business 
model to maximise returns from 
prevailing market conditions.

2

3

4

6

Strategic financial forecasts are updated prior to each Board meeting including scenario 
planning for different economic cycles and eventualities. 
Regular review of property cycle by reference to dashboard of lead indicators.
Board annual strategy review including regular economic and market updates 
received from third parties.
Dedicated in-house team with remit to research sub-markets in central London seeking 
the right balance between investment and development opportunities for current and 
prospective market conditions.
Detailed due diligence undertaken for all prospective acquisitions prior to purchase 
to ensure appropriate returns.
Quarterly review of asset-by-asset business plans to assess future performance and 
to inform hold/sell decision making.

Near-term strategic priorities

1 COVID-19 response

2 Deliver and lease committed schemes

3 Prepare the pipeline

4 Progress sustainability agenda

5 Further embed values

6  Continue to grow flex offer

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Directional travel of 
net risk movement 
over the last 12 months

Commentary

London generates around 22% of UK GDP, with the largest economy of any city in Europe, and is one of the world’s 
leading commercial, creative and financial centres, with a deep pool of talent.
Despite the uncertainty created by the UK’s exit from the EU and the more recent economic disruption as a result 
of COVID-19, London has been growing and is forecast to grow further. By 2030, London’s population is expected 
to have increased to around ten million, up from around nine million today, and improving infrastructure, including 
extensions of the tube network and the expected opening of Crossrail in 2021, will bring more people within its reach. 
Its combination of a strong legal system, time zone advantages, international connectivity and a welcoming attitude 
to businesses from around the world has resulted in London retaining its position leading the Global Power City Index 
2019, as measured by the Mori Memorial Foundation.
Central London also offers one of the world’s largest commercial real estate markets, with around 440 million sq ft of 
office and retail property attracting a deep and diverse mix of occupiers and property investors, many from overseas. 
London’s markets are also highly liquid and remain one of the leading global destinations for real estate investment.

Over the long term, real estate markets have historically been cyclical and London has been no exception to this. 
As a result, we have consistently adopted a conservative approach to financial leverage. 
As at 31 March 2020, our property LTV was 14.2%, net gearing was 16.2% and interest cover not measurable. 
As a result, we have substantial headroom above our Group debt covenants. We estimate property values 
could fall around 70% before Group debt covenants could be endangered, even before factoring in mitigating 
management actions. 
The Group also has significant financial capacity with liquidity of £411 million, comprising cash of £111 million and 
undrawn committed facilities of £300 million. In addition, the Group’s weighted average interest rate remains low at 
only 2.2% (falling to 1.9% on a fully drawn basis), with an attractive debt maturity ladder and diverse funding sources, 
predominantly borrowing on an unsecured basis.

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The Group has this year again continued to take advantage of supportive market conditions through developing 
414,600 sq ft of prime Grade A space for delivery in the next 18 months into a supply-constrained market, whilst also 
profitably recycling capital with £73 million of sales at a 10% premium to book values.

Increasing

No change

No change

Annual Report 2020  Great Portland Estates 87

 
 
 
 
Our approach to risk continued

How we manage principal risks and uncertainties continued

Principal risk

Link to 
strategic 
priorities

How we monitor and manage risk

Failure to profitably deliver the development programme

2

3

4

We fail to translate the 
development pipeline and 
current committed schemes 
into profitable developments 
through poor development 
management, inappropriate level 
of development undertaken as 
a percentage of the portfolio, 
poor timing of activity and/or 
inappropriate products for the 
local market resulting in weak 
leasing performance, reputational 
damage, reducing asset values 
and lowering Group earnings.

Challenging planning environment

The increasingly stringent 
planning environment limits 
our ability to create new spaces, 
increases costs, and results 
in our failure to obtain 
viable planning consents.

3

4

Updated strategic financial forecasts reviewed at each scheduled Board meeting including 
scenario planning for different economic cycles. 
Development management quarterly updates to Executive Committee with reporting to each 
scheduled Board meeting.
Regular review of portfolio mix and asset concentration. Adjustment of the portfolio as 
appropriate through undertaking acquisitions and/or development projects in joint venture 
or forward funding.
Prior to committing to a development, the Group conducts a detailed financial and 
operational appraisal process which evaluates the expected returns from a development in 
light of likely risks. During the course of a development, the actual costs and estimated 
returns are regularly monitored to signpost prompt decisions on project management, 
leasing and ownership.
Working with agents, potential occupiers and purchasers to identify their needs 
and aspirations including sustainability, wellbeing and technological advances 
during the planning application and design stages.
Regular pipeline review meetings between Development and Portfolio Management teams 
and quarterly asset review sessions.
Selection of contractors and suppliers based on track record of delivery and creditworthiness.
In-house Project Management team closely monitor construction and manage contractors 
to ensure adequate resourcing to meet programme.
Post-completion reviews undertaken through Final Appraisal process on all developments 
to identify best practice and areas for improvement.
Regular review of the prospective performance of individual assets and their business plans 
with joint venture partners.

Prior to committing to a development, the Group conducts a detailed financial and 
operational appraisal process which evaluates the expected returns from a development 
in light of likely risks.
Active engagement with planning authorities. 
Early engagement with local residents and community groups, adjoining owners 
and freeholders.
Third-party expertise used to support in-house teams, where appropriate.
Regular updates to the Executive Committee and Board on regulatory and planning 
policy developments.
Sustainable building design, including climate change mitigation and adaption, 
considered at an early design stage. All our major developments are subject to 
a minimum BREEAM rating requirement of ‘Very Good’ for major refurbishments 
and ‘Excellent’ for new build developments.

Near-term strategic priorities

1 COVID-19 response

2 Deliver and lease committed schemes

3 Prepare the pipeline

4 Progress sustainability agenda

5 Further embed values

6  Continue to grow flex offer

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Directional travel of 
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over the last 12 months

Commentary

We currently have three committed schemes on-site, set to deliver 414,600 sq ft of high quality space, all near 
Crossrail stations and all targeting BREEAM ‘Excellent’. These schemes are already 48% pre-let or under-offer, 
with two of the schemes due for completion this year, and are expected to generate a profit on cost of 14.7%.
Beyond this, the Group is preparing a further ten schemes set to deliver more than 1.4 million sq ft across the 
coming decade.

No change

Increasing

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To successfully deliver our developments, we work closely with both the local authorities and communities to secure 
planning consents to create great new spaces, helping London to thrive. The emerging London Plan is now being 
adopted as policy and includes a number of further challenging requirements. Moreover, our substantial and flexible 
pipeline of ten uncommitted schemes totals 1.4 million sq ft across four London boroughs, all of which will likely be 
subject to planning approval requirements.
We aim to engage with local authorities in an open, transparent and non-adversarial manner to enable us to 
secure planning consents that are both beneficial to us and the local communities in which they are built. In line 
with our social value guidelines, as a matter of course, we liaise with community stakeholders to understand their 
needs and, where possible, we will adjust our proposals to take account of comments received. We use planning 
performance agreements with the local planning authority to ensure that our planning applications are determined 
in a timely manner. 
During the year we have continued to work with community groups in the London Bridge area, supporting air quality 
and urban greening projects, apprenticeship opportunities and local schools. Over the coming months we will 
continue to support these initiatives, focusing on ensuring that our proposals for New City Court, SE1 enhance the 
excellent work already being undertaken by community groups in the area. This process is implemented at each 
development scheme, with urban greening and biodiversity projects currently being supported in Islington as part 
of early engagement for our 50 Finsbury Square, EC2 and our social value guidelines are in the process of being 
implemented in full for Oxford House, W1.
Moreover, sustainability is becoming ever more important in the planning process with many of our key local 
authorities declaring climate emergencies. We will look to work with them to support their principles of ‘good growth’.

Annual Report 2020  Great Portland Estates 89

 
 
 
 
Our approach to risk continued

How we manage principal risks and uncertainties continued

Principal risk

People

Link to 
strategic 
priorities

How we monitor and manage risk

Failure to attract, develop and 
retain high quality, suitably 
experienced individuals means 
we may not have the necessary 
capability or resource levels 
resulting in the failure to deliver 
our business plan.

1

2

3

4

5

6

Regular review is undertaken of the Group’s resource requirements and succession planning.
The Group has a remuneration system that is strongly linked to performance and a formal 
six-monthly appraisal system to provide regular assessment of individual performance.
Benchmarking of remuneration packages of all employees is undertaken annually to ensure 
competitive financial and non-financial packages in line with market rates.
Annual personal development planning and ongoing training support for all employees 
together with focused initiatives to nurture potential successors, including introduction 
of mentoring programme.
Clear articulation of GPE values so all existing and prospective employees understand our 
core beliefs and behaviours. Launch of new Inclusion and Diversity strategy in October 2019.
Health and wellbeing programme implemented following earlier roll-out of mental 
health training programme.
Focus on people engagement with regular two-way communication and responsive 
employee-focused activities, e.g. Board engagement sessions, employee engagement 
surveys and flexible working.

Meeting occupier needs and competition

We fail to understand and provide 
spaces that meet quickly evolving 
occupier needs, including an 
inappropriate mix of flex versus 
traditional space and/or we fail to 
identify and react effectively to 
shifting patterns of work space 
use. This could lead to GPE failing 
to deliver space that occupiers 
want resulting in poor investment 
returns, potentially stranded 
assets and losing occupiers 
to competitors.

Poor capital allocation decisions

We make poor decisions 
regarding the allocation 
of capital such that we buy, 
sell, hold or develop the 
incorrect buildings resulting in 
inadequate investment returns.

2

3

4

6

3

4

6

Quarterly review of individual property business plans and the market more generally, 
including review of property IRRs.
Portfolio Management quarterly updates to Executive Committee with reporting 
at each scheduled Board meeting.
Board and management reviews of GPE flexible space offer across the portfolio, 
including broadening our product offering.
The Group’s in-house Portfolio Management teams have proactive engagement with 
occupiers to understand their occupational needs and requirements with a focus on 
retaining income, including through our annual occupier survey.
Our Director of Workplace and Innovation is responsible for keeping the Board up 
to date on market developments and incorporating innovation in the GPE portfolio.

Regular reviews conducted of individual property IRRs, including quarterly review of individual 
property dashboards, and market generally.
Weekly investment meetings held and regular dialogue maintained with key intermediaries.
Portfolio Management, Development and Leasing quarterly updates to Executive Committee 
with reporting at each scheduled Board meeting.
Strategic Review forecast on an asset-by-asset basis provides a business plan for 
each individual property which is reviewed against the performance of the business 
as a whole.
Detailed due diligence processes in place to help ensure appropriate returns.

Near-term strategic priorities

1 COVID-19 response

2 Deliver and lease committed schemes

3 Prepare the pipeline

4 Progress sustainability agenda

5 Further embed values

6  Continue to grow flex offer

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Directional travel of 
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over the last 12 months

Commentary

The motivation of our people and maintaining our strong collaborative culture remains fundamental to the delivery 
of our strategic priorities. During the year, the strength of our values and appeal of our culture was highlighted with 
our most recent employee engagement survey showing 94% of our people would “recommend GPE as a great place 
to work” and we were delighted to make several internal Senior Management Team promotions as we develop our 
talent from within. We also successfully launched our Inclusion and Diversity strategy at an all-staff event, with valuable 
participation from our Non-Executive Directors, and we are pleased to have now achieved the National Equality 
Standard accreditation.
We also broadened our health and wellbeing programme for our employees, held another Community Day, working 
with our charity partners Centrepoint and Groundwork London, and launched our Board engagement programme. 
Our employee retention remains high at 87% and we continue to focus on growing the breadth and depth of our 
talent, providing focused development support where needed. 

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We have had another strong year of leasing, completing 46 new lettings and securing £14.4 million of rent at an 8.8% 
premium to March 2019 ERVs, whilst continuing the successful roll-out of our flexible space offering. We have also 
continued to capture reversion across the portfolio and, coupled with the leasing activity, this has helped drive like-for-
like Group rent roll up by 3%.
Over the past twelve months, our flexible office space has increased from 87,600 sq ft to 219,600 sq ft, or 11% of our 
office portfolio, and we are also currently appraising a further 152,200 sq ft of flexible space across the portfolio. After 
the success of our co-working arrangement with Runway East at New City Court, SE1, we expanded our co-working 
arrangement with a new flexible office partnership arrangement with Knotel for 82,300 sq ft at City Place House, EC2. 
In addition, we have committed 16,300 sq ft to our new Flex+ space at Dufours Place, W1, which will provide occupiers 
with added service provision as well as communal facilities such as a courtyard and ground floor café. 
During the year, we created our Occupier Services and Property Services teams to reflect our focus on customer 
service delivery and the changing nature of the occupier environment, whilst also ensuring the structure meets the 
needs of our growing portfolio, in particular given our upcoming development completions. We also commissioned 
an independent customer satisfaction survey to update our understanding of how our occupiers view their buildings 
and the services we provide. Encouragingly, our Net Promoter Score increased from +17.5 in 2017 to +25.3 in 2019, 
materially ahead of our peer group which scored +12.9.

With limited availability of attractively priced acquisition opportunities and the depth of opportunity in our existing 
portfolio, we made no acquisitions in the year. However, taking advantage of strong investor demand for well let, 
attractively located properties, we made sales of £73 million in the year. 
We also successfully completed our £200 million share buyback, meaning that we have now returned more 
than £615 million of surplus equity to shareholders since 2017, whilst retaining the lowest loan to value ratio in 
the UK REIT sector.

No change

Increasing

No change

Annual Report 2020  Great Portland Estates 91

 
 
 
 
Our approach to risk continued

How we manage principal risks and uncertainties continued

Principal risk

Health and safety

Link to 
strategic 
priorities

How we monitor and manage risk

1

2

3

4

5

A serious health and safety 
incident (including by our 
contractors) could result in loss of 
life or serious injury and financial 
and reputational damage to GPE. 
Furthermore, significant changes 
in health and safety regulations 
driven by government intervention 
following events such as the 
Grenfell Tower fire may increase 
costs of compliance and/or risks 
of non-compliance.

Formal quarterly reporting on health and safety to the Executive Committee and 
regular reporting to the Board, including on progress against new Health and Safety strategy.
Regular site health and safety checks undertaken by Executive Committee members, 
Development and Project Management team members and third parties.
Pre-qualification and competency checks undertaken for all contractors and 
consultants appointed.
Formal reporting on near misses/significant incidents and accidents.
Annual cycle of health and safety audits.
Online health and safety management system in place for business.
Comprehensive fire safety management procedures in place.

Cyber security and infrastructure failure

A cyber attack or infrastructure 
failure could lead to business or 
network disruption within our 
portfolio or loss of occupier data. 
This could have a significant 
impact on flex+ occupiers to 
which we provide increased 
infrastructure support and 
high risk occupiers who may 
seek to recoup damages 
from GPE, leading to potential 
direct regulatory fines 
and reputational damage.

1

2

3

4

5

6

IT and cyber security updates are regularly reported to the Executive Committee 
and the Board.
A head office and portfolio IT risk register is maintained.
The Group’s IT Business Continuity Plan is regularly reviewed and tested and recovery 
of data at off-site recovery centre is tested during the year.
Regular testing of IT security is undertaken including penetration testing of key systems. 
The Group’s data is regularly backed up and replicated.
Employee awareness training on cyber risk is undertaken regularly. Cyber risk insurance 
is in place.
Each building has a bespoke Emergency Action Plan, maintaining appropriate systems 
to mitigate any infrastructure failure.

Near-term strategic priorities

1 COVID-19 response

2 Deliver and lease committed schemes

3 Prepare the pipeline

4 Progress sustainability agenda

5 Further embed values

6  Continue to grow flex offer

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Directional travel of 
net risk movement 
over the last 12 months

Commentary

We continue to focus on ensuring that we have a best in class and proactive health and safety culture at GPE, which 
we reinforced during the year with the recruitment of a new Head of Health and Safety. 
During the year, following Board approval, we launched a new Health and Safety strategy, with the goal of embedding 
a proactive approach to health and safety across our business and with our supply chain partners which goes beyond 
legal compliance. The main aim was to create an integrated approach, with each individual in the business having the 
confidence to take ownership of health and safety.
We have also enhanced our health and safety management system, integrating systems between our development, 
occupier and property services teams to improve communication. All employee-related health and safety information 
has been updated and incorporated on our intranet, complete with case studies of health and safety leadership in the 
business. We instigated a programme of senior leadership team health and safety tours of our development sites and 
managed portfolio with a number of inspections taking place during the year. 
Our change in approach is also being reflected in how we measure health and safety performance incorporating 
the use of both reactive measures, such as accident reporting and outcomes from accident investigation, as well as 
more proactive health and safety indicators such as positive health and safety observations and the implementation 
of control measures. We are also supporting our occupiers, rolling out occupier fire safety monitoring checks to help 
provide information on changing expectations on fire safety across the industry. 
The COVID-19 outbreak has required us to put additional health and safety processes in place for our employees, 
occupiers and suppliers. We have followed Government guidelines from the start of the outbreak, supported 
our employees in their transition to home working, worked with our suppliers to ensure that essential building 
maintenance could be carried out safely and introduced additional cleaning measures and social distancing protocols 
to reassure our occupiers.
The Group had six reportable accidents during the year. Where accidents do occur, we work with our supply chain 
on accident investigation to understand lessons learned and opportunities for improvement, to consider how the 
work could have been set up differently and to understand how, as a client, we can better support our suppliers.

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Given the increased incidence of attempted cyber attacks on UK businesses, we have continued to invest time 
and resource into our cyber security measures, both in our head office and across our portfolio.

No change

Increasing

Annual Report 2020  Great Portland Estates 93

 
 
 
 
Our approach to risk continued

Viability 
statement

Assessment of the Group’s prospects
In accordance with provision 31 of the 2018 UK Corporate 
Governance Code, the Board has assessed the prospects of 
the Group over a longer period than the 12 months that has 
been required by the ‘Going Concern’ provision. The work 
conducted for this longer-term assessment supports the 
Board’s statements on both viability, as set out below, 
and going concern as set out on page 157. 

The Group’s future prospects are assessed regularly and 
at an annual Strategy Review in April. For the current year, 
due to the market disruption from COVID-19, the Strategy 
Review was postponed. In its place, we conducted a 
comprehensive update of the Group’s financial forecasts. 
This update included a number of market scenarios, 
including the impact of exiting the EU, a significant 
recession and a number of potential COVID-19 stress 
sensitivities. The update included an assessment of the 
pandemic’s impact on the macro-economic environment, 
forecasts of key property market metrics (including 
yields and rental value movements), annual valuation 
movements for each of our properties, forecast cash 
collection rates based on our experience to date, forecast 
levels of delinquencies and delays to the delivery of our 
development programme. 

The key outputs from this process are full forecast financial 
statements for a five-year period, with a primary focus 
on the first three years. The forecasts are summarised in 
a dashboard, which analyses profits, cash flows, funding 
requirements, key financial ratios and headroom in respect 
of the financial covenants contained in the Group’s various 
loan arrangements. The forecasts were considered 
by the Board in April and May, and will be updated 
and incorporated into the Strategy Review which will 
now take place in September 2020. 

The Group’s financial forecasts contain a number of 
assumptions, including:

 – estimated year-on-year movements in rental values 
and yields for each of our key sub-markets under 
a number of scenarios;

 – the refinancing of the Group’s debt facilities as they 

fall due, albeit the Group has only one small refinancing in 
the viability period (the GVP loan facility);

 – the completion of the Group’s committed development 

programme, in line with our most recent estimated 
completion dates, which constitute 22% of the portfolio 
by value, and the commencement of selected pipeline 
projects; and

 – forecast interest rates. 

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Assessment of viability 
A three-year viability period is considered an optimum 
balance between our need to plan for the long term 
and the shorter-term nature of our active business model, 
which often includes high levels of recycling of our property 
portfolio and a committed development programme which 
will be delivered over the next three financial years. 

The assessment of viability included stress testing the 
resilience of the Group, and its business model, to the 
potential impact of the Group’s principal market risks, 
or a combination of these risks, on Group cash flows, 
profitability, property valuations and the impact on 
the financial covenants contained in our various loan 
arrangements. Specifically, given the ongoing economic 
disruption from COVID-19, our assessment of viability was 
based on forecasting the Group’s performance under a 
static and a ‘Going Concern’ market scenario with further 
sensitivity analysis to understand the resilience of the 
Group to COVID-19 disruption. 

Our static market scenario assumed flat rents and property 
yields together with our latest forecast cash collection 
estimates. The Going Concern market scenario then 
overlaid the impact of a significant economic and property 
downturn similar in severity to the 2008/09 recession. 
Over the three-year period the Going Concern scenario 
reduced values by around 40%.

We modelled these two market scenarios under two 
COVID-19 stress sensitivities: Severe and Extreme. 
These sensitivities assumed, for a period of up to 24 months, 
reduced levels of cash collection, potential occupier failures, 
increased void periods, delayed development completions 
and no property disposals. Aligned with our Going Concern 
assessment, our principal scenario for assessing the Group’s 
viability was the Going Concern market scenario with the 
Extreme COVID-19 sensitivity.

The results of this sensitivity analysis showed that, given 
the Group’s low levels of debt and high liquidity, it would 
be able to withstand the impact of these scenarios over the 
period of the financial forecast and continue to operate with 
headroom above the financial covenants contained in its 
various loan arrangements. 

In addition, a reverse stress test was performed, to 
understand how extensive the impact of COVID-19 would 
need to be to breach the Group’s interest cover ratio or 
inner borrowing covenants. Under this scenario, before any 
mitigating actions, in the three-year period, rental income 
would need to fall by around 47%, property values would 
need to fall by more than 50% and all development activity 
would need to be suspended by two years.

Viability statement
Whilst the directors have no reason to believe that the 
Group will not be viable over a longer period, based on this 
assessment of the prospects and viability of the Group, the 
directors confirm that they have a reasonable expectation 
that the Group will be able to continue in operation and 
meet its liabilities as they fall due over the three-year period 
ending 31 March 2023.

Governance

In this section:

96 Overview

97

Introduction from the Chairman

100 Leadership and purpose

110 Division of responsibilities

112 Composition, succession and evaluation

118 Audit, risks and internal controls

126 Directors’ remuneration report

155 Report of the directors

158 Directors’ responsibilities statement

A 
S P A C E 
T O   

I N D U L G E

Receptions as social hubs offering refreshments

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Annual Report 2020  Great Portland Estates 95

Overview

Leadership and purpose
Provides an overview of the activities undertaken by the 
Board in the year, how the Board has considered its s.172 
responsibilities and its governance framework.

 – A review of the year from the Chairman

 – Board activities during the year

 – Setting the Company’s standards

 – Purpose, values and culture

Division of responsibilities
Explains the roles of the Board and its directors.

 – Stakeholder engagement and how the Board has 

considered its s.172 and stakeholder responsibilities

 – Our conflicts of interest procedures

 – Board induction and development
 › See more about our approach to leadership and purpose 

on pages 97 to 109

 – The role and interaction of the Board and its Committees 

during the year

 – The roles of the individual directors
 › See more about our approach to division of responsibilities 

on pages 110 and 111

Composition, succession  
and evaluation
Sets out the key processes which ensure that the Board 
and its Committees can operate effectively.

 – Nomination Committee report

 – Composition and independence

 – This year’s Board evaluation
 › See more about our approach to effectiveness on pages 112 to 117

Audit, risks and  
internal controls
Explains the role of the Board and the Audit Committee 
in ensuring the integrity of the financial statements and 
maintaining effective systems of internal controls.

 – Internal controls and ongoing risk management

 – Fair, balanced and understandable

 – Audit Committee report
 ›  See more about our approach to accountability on pages 118 to 125

Remuneration
Describes the Company’s remuneration arrangements 
in respect of its directors, how these have been 
implemented in 2019/20 and details of our 
proposed revised remuneration policy to govern 
future arrangements.

 – Statement by the Remuneration Committee Chair

 – Remuneration of directors at a glance

 – Annual report on remuneration

 – Directors’ remuneration policy
 › See more about our approach to remuneration on pages 126 to 154

Statement by the directors on compliance with the provisions of the UK Corporate Governance Code
The UK Corporate Governance Code 2018 (the Code) came into effect and applied for GPE’s financial year ended 31 March 
2020. The Board considers that it has complied in full with the provisions of the Code during the year with the exception of 
Provision 38 which requires the alignment of Executive Director pension contributions with the wider workforce. As explained 
in the Directors’ remuneration report on pages 128 and 145, we have committed to align the contribution levels of the current 
Executive Directors with the average workforce contribution rate by the end of 2022, with any new Executive Directors to be 
aligned on appointment. The Code is publicly available at www.frc.org.uk. A summary of the system of governance adopted 
by the Company and how we have applied the principles of the Code is set out on pages 97 to 154.

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Introduction from the Chairman

At GPE, the Board’s support, advice and 
interaction extends beyond the boardroom, 
supporting our efforts to promote and monitor 
culture at GPE and ensure its alignment with 
our purpose, values and strategy.”

Richard Mully
Chairman

Dear fellow shareholder
I am delighted to introduce this year’s Corporate Governance 
report for the financial year ended 31 March 2020.

The Board recognises that how the Group does business is as 
important as what it does. A strong governance framework 
with robust supporting processes across the Group, and 
with high standards set from the top, is a key factor in our 
delivering sustainable business performance, generating 
value for shareholders and contributing to wider society.

A key part of the Board’s role is to provide entrepreneurial 
leadership, with appropriate oversight, challenge and 
support to management. At GPE, the Board’s support, advice 
and interaction extends beyond the boardroom, supporting 
our efforts to promote and monitor culture at GPE and ensure 
its alignment with our purpose, values and strategy. 

Board focus and oversight
One important area of continuing Board discussion has been 
the consideration of our strategy in these uncertain times. 

While we have discussed our strategy on an ongoing basis, 
following the outbreak of the COVID-19 crisis we took the 
decision to postpone our scheduled annual Strategy Review 
session in April 2020 until later in the year. We instead used 
this time to review more immediate and near-term priorities, 
including GPE’s response to the current crisis. 

Other areas of the Board’s focus during the year included:

 – the strengthening of our culture through our purpose 

and values;

 – the development of our Sustainability strategy and 

Statement of Intent;

 – implementing and enhancing our approach to employee 

and wider stakeholder engagement;

 – overseeing the launch of our new Inclusion and Diversity 

strategy and other talent planning, succession and 
diversity initiatives;

 – the launch of GPE’s inaugural Health and Safety strategy; 

and

 – strengthening our risk management, GDPR and IT 

governance processes. 

Further details can be found in ‘What we did in 2019/20’ on 
pages 108 and 109.

2018 UK Corporate Governance Code  
and s.172 reporting
The year under review is the first year in respect of which the 
revised UK Corporate Governance Code 2018 (the Code) 
has applied to GPE. This report demonstrates how we have 
applied the principles of the Code and complied with the 
provisions of the Code during the year and our approach 
to governance in practice. 

Details of how the Board has discharged its duty under 
section 172 of the Companies Act 2006 can be found on 
pages 65 and 66.

Board changes 
Succession planning is an important part of our governance 
processes. Having identified a need to further strengthen 
the Board’s financial experience for now and into the 
future, we were delighted to welcome Vicky Jarman to the 
Board as a Non-Executive Director. Vicky joined the Board 
on 1 February 2020 when she also become a member of 
the Audit, Nomination and Remuneration Committees. 
A search process is currently underway for an additional 
Non-Executive Director with relevant property expertise 
and we hope to announce an appointment in due course. 
Details regarding our Board appointment process can be 
found in the Nomination Committee report on page 113.

Board effectiveness review
This year, we undertook an external evaluation of the 
effectiveness of the Board and its Committees which was 
facilitated by Dr Tracy Long of Boardroom Review Limited, 
an external board evaluation specialist. Details of this process, 
the findings of the review and our progress against the 
actions arising from the 2018/19 Board evaluation can be 
found on pages 115 and 116.

Our strategy and consideration of the likely 
consequence of decisions for the long term
In the context of continued uncertainty arising from 
geopolitical and macro-economic factors, including the UK’s 
exit from the European Union, and more recently COVID-19, 
a consistent feature of our Board discussions has been 
whether and how we might adapt our strategy to ensure 
we are well positioned to maximise the opportunity we have 
to generate long-term value across our business. As part of 
these discussions we challenge our strategic ‘givens’ and 
reflect on the optimum size for our business, whether our risk 
profile is appropriate, whether and how we should return any 
excess equity and on our investment and disposal strategies. 
The Group’s business model and strategy are outlined on 
pages 16 to 17 and 30 to 31.

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Annual Report 2020  Great Portland Estates 97

Introduction from the Chairman continued

We have continued to focus on how we should innovate 
and evolve our business to react to changing workplace 
needs and what occupiers want. This year has seen 
the further development and roll-out of our flex space 
offerings, further details of which can be found on pages 
40 and 41. Today, flexible space accounts for 11% of our 
office portfolio and we are currently appraising a further 
152,200 sq ft in the existing portfolio, as well as actively 
targeting investment opportunities that lend themselves to 
these products.

As the relationship between owner and occupier evolves, 
the Board recognises the importance of innovation and 
technology in turning challenges into opportunities. With our 
clear purpose of unlocking potential, we are innovating across 
our operations and working with our communities to create 
space for London to thrive. In November 2019, we completed 
the roll-out of our new app ‘sesame’, further enhancing the 
level of service we are delivering to our occupiers. In January 
2020, we also made a commitment of up to £5 million to 
invest in Pi Labs European PropTech venture capital fund 
whose primary focus is to invest in early stage PropTech start-
ups across Europe and the UK that use technology solutions 
to enhance the real estate value chain. 

We have maintained our commitment to capital allocation 
and balance sheet discipline and in November 2019 we 
completed our £200 million return of surplus equity to 
shareholders through our share buyback programme. 
At the same time, we continue to be supportive of the 
management team in preserving financial firepower to 
exploit any weaknesses in the market and to scale up in 
the event of a market downturn.

Stakeholder engagement 
Building and nurturing strong working relationships with 
our employees, occupiers, suppliers, shareholders and debt 
capital providers, JV partners, communities, local planning 
authorities and other stakeholders is critical to our success 
and is intrinsic in our day-to-day activities. As well as direct 
engagement, a key part of the Board’s role is, therefore, the 
oversight of work undertaken by the GPE team to maintain 
and enhance these relationships. 

This year we have continued our efforts to listen to our 
stakeholders in order to better understand their views 
and to inform our decision making and strategic planning. 
These efforts have continued during the recent COVID-19 
crisis, during which period we have sought to offer support, 
where appropriate, to our stakeholders that need it during 
these unprecedented times. Further details of how we 
engage with our stakeholders are set out on pages 58 to 66 
and 103 to 106.

Sustainability and the impact of the Company’s 
operations on the community and the environment
Sustainability is a key priority for GPE and our stakeholders. 
During the year, the Board has received reports and updates 
from our Director of Sustainability and Community and 
has held detailed discussions regarding our sustainability 
objectives, strategy, risks and opportunities. In addition to 
being a good corporate citizen, sustainability has become 
an economic and strategic imperative. This year has seen 
a step change in our sustainability efforts and we are 
integrating ESG considerations into all of our activities. 
At GPE, we now believe that sustainability touches everything 
we do. 

The Board approved GPE’s updated Sustainability policy 
in April 2020 and our new Statement of Intent in May 2020. 
Further details can be found on page 72.

Reflecting our sustainability commitments and aspirations, 
we were pleased to announce the Group’s new innovative 
£450 million ESG-linked revolving credit facility in February 
2020, the first such facility to be issued by a UK REIT. 
From 2020/21, sustainability metrics now also feature 
as an important element of our Executive Committee’s 
annual bonus targets, as further explained in the Directors’ 
remuneration report on pages 128 and 133.

We have continued to oversee the delivery of our Community 
strategy, which has as its cornerstone four themes involving 
engaging with the community and suppliers:

 – breaking the cycle of youth homelessness;

 – improving air quality and urban greening;

 – addressing the skills gap through engagement 

with educational initiatives; and

 – mitigating the risk of modern slavery at our 

construction sites.

We were pleased to extend our partnerships with our two 
charity partners, Centrepoint and Groundwork London, 
until April 2022. In view of the likely impact of the COVID-19 
crisis on some of the more vulnerable members in our 
communities, we were also pleased to increase our annual 
donation to Centrepoint from £50,000 to £75,000 in April 
2020 to support the launch of Centrepoint’s emergency 
funding appeal.

In May 2020, we were delighted to announce the creation 
of a GPE COVID-19 Community Fund to support some of 
the most vulnerable people in our London communities at 
this unprecedented time. Through a combination of Board, 
employee and Company contributions, we have so far raised 
more than £280,000 to be applied to worthwhile causes with 
a London focus. 

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I am delighted that the efforts of our team have been 
rewarded with our winning a number of awards and 
recognitions, including Property Week’s ‘Developer of the 
Year’ 2019 and IR Magazine’s Award for ‘Best in Sector: Real 
Estate’. I am also very pleased to report our achieving a gold 
award in relation to EPRA’s 2019 Sustainability Best Practice 
Recommendations and a green five star rating in relation 
to GRESB. 

It was very encouraging to see the results of our latest 
employee pulse survey in November 2019 showing an 
Employee Engagement Index score of 91%, reflecting 
the high levels of overall employee engagement at GPE. 
Furthermore, our Net Promoter Score from this year’s 
independent customer satisfaction survey, best translated 
as the willingness to recommend GPE, increased from 
+17.5 in 2017 to +25.3, significantly ahead of our peer group.

These outcomes are a great credit to the hard work and 
dedication of the entire GPE team.

Lastly, I would like to thank all our of shareholders for 
their continued support and I look forward to the activities 
of the next year continuing to contribute to the long-term 
success of GPE. 

Richard Mully 
Chairman 
9 June 2020

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Our management of risk and opportunities
Consideration of risks is an integral part of how GPE 
operates on a daily basis and is part of any transaction 
appraisal. The Board also formally revisits the level of 
oversight and the monitoring of risks over a variety of 
areas including strategy, acquisitions and disposals, 
capital expenditure on developments, finance, people 
and sustainability matters twice a year. We also recognise 
that with risks come opportunities and, therefore, part 
of our Board oversight is to consider, as part of our regular 
Board meetings and approval of transactions, our risk 
appetite and to identify emerging risks and opportunities. 

During the year, we specifically considered how we are 
addressing the risks and opportunities in a number of areas, 
including in relation to the COVID-19 crisis, our flex space 
offering, sustainability, technology and cyber security, and 
health and safety. In September 2019, the Board approved 
GPE’s inaugural Health and Safety strategy which is designed 
to further mitigate operational risks and strengthen our 
health and safety culture. 

More broadly, the Board and Audit Committee undertook 
a review to enhance GPE’s risk management framework 
and processes to ensure these remain appropriately robust. 
We also took this opportunity to challenge and refocus our 
principal risks. For more on our risks, see ‘Our approach to 
risk’ on pages 80 to 94.

Maintaining a reputation for high standards 
of business conduct
We aspire to the highest standards of conduct and, together 
with a culture of continuous improvement in standards and 
performance, this helps to ensure that good governance 
extends beyond the boardroom.

Annually the Board approves the Group’s Ethics and 
Whistleblowing policies, both of which are also reviewed in 
advance by the Audit Committee and which are available 
on our website at www.gpe.co.uk/about-us/governance. 
This year we have updated our Ethics policy, including to 
address wellbeing and mental health considerations. 

In September each year, the Board also considers and 
approves our modern slavery statement, which explains the 
activities we have undertaken during the year to demonstrate 
our commitment to seeking to ensure that there is no slavery, 
forced labour or human trafficking within any part of our 
business or in our supply chains. A copy of our modern 
slavery statement is available at www.gpe.co.uk. More on 
how we behave can be found on pages 61 and 106.

Annual Report 2020  Great Portland Estates 99

Leadership and purpose

The Board’s attendance in 2019/20 
Attendance at scheduled Board and Committee meetings during the year was as follows:

Board –
scheduled 
(6 meetings)1

Audit  
Committee  
(4 meetings)  
See pages 118 to 125

Nomination  
Committee  
(5 meetings)  
See pages 112 to 117

Remuneration  
Committee  
(5 meetings)  
See pages 126 to 154

Chairman
Richard Mully2
Executive Directors3
Toby Courtauld
Nick Sanderson
Non-Executive Directors4
Charles Philipps
Wendy Becker
Nick Hampton
Vicky Jarman5
Alison Rose6

  Meetings attended

–

–
–

–
–

(0/0)

 (1/1)

 (1/1)

–
–

–
(0/0)

1.  There were six scheduled Board meetings in 2019/20. There was one unscheduled Board meeting held at short notice during the year – see Board activities 

on pages 101, 108 and 109. In addition, the Board held regular update calls from mid-March 2020 to discuss GPE’s response to the impacts, risks and 
opportunities arising from the COVID-19 crisis.

2.  Richard Mully stepped down from the Remuneration Committee on 27 February 2020 following the appointment of Vicky Jarman and a review 
of the Committee’s composition. Richard Mully has an open invitation to attend future Remuneration Committee meetings where appropriate.
3.  Executive Directors are not members of the Audit, Nomination or Remuneration Committees, however, they are invited to attend for parts of or 

all of certain Committee meetings where appropriate. 

4.  Non-Executive Directors (including the Chairman), where not a member of a Committee, have a standing invitation to attend meetings of that Committee 

where appropriate.

5.  Vicky Jarman became a member of the Board and of the Audit, Nomination and Remuneration Committees on 1 February 2020 and the number in 

(parentheses) is the number of meetings she could have attended in the year.

6.  Alison Rose was unable to attend the Board meeting held on 19 September 2019 due to a late scheduling conflict with another material business commitment. 
Alison was unable to attend one Nomination Committee meeting held on 8 November 2019 due to the unexpected ill-health of a family member. In each case 
Alison received meeting papers in advance and was able to provide comments to the Chairman of the meeting.

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Board activities
The Board typically meets for scheduled Board meetings six times a year. The Board will also meet as necessary to consider 
matters of a time-sensitive nature.

The role and interaction of the Board and its Committees during the year
The Board has a duty to promote the long-term sustainable success of the Company for its shareholders. Its role 
includes the establishment, review and monitoring of strategy, values and culture, overview of human resource levels and 
succession planning, approval of major acquisitions, disposals, capital expenditure and financing arrangements and of the 
Group’s systems of internal control, governance and risk management. The Board provides and promotes effective and 
entrepreneurial leadership across the business within the Group’s governance framework. 

July

September November January March/April May

Strategy and its implementation

Strategic review, discussion and setting of Business Plan
Chief Executive’s Report including market conditions dashboard, operational 
parameters, investment market and propositions, asset strategies, strategic risks 
and opportunities, team resourcing and development 
Board Reports on valuation, leasing activity, major developments summary, 
approved vs. actual development spend, longer-term pipeline and sales review
Finance and Operations Director’s Report including forecasts, finance initiatives, 
debt and equity markets update, operational matters including health and safety, 
HR, ESG, IT and tenant watch list

Shareholder analysis

Board property tour (April 2020 tour postponed due to COVID-19)
Risks

Formal review of risk management and internal controls

Ongoing monitoring of risks
Governance
Review of half-year or annual results, going concern, viability statement, 
dividend policy and analyst presentation
Stakeholder feedback, including shareholders and analysts, employees, occupiers, 
communities, suppliers, joint venture partners, local planning authorities 

Reports from Board Committees
Corporate governance matters including authority levels, Terms of Reference, 
UK Corporate Governance Code compliance 

Health and Safety Reports including strategy and updates 

Sustainability updates including vision, strategy, targets and roadmap 
Corporate Responsibility including approval of the Company’s Modern Slavery 
Statement, Ethics, Whistleblowing and Gifts and Hospitality policies
Evaluation

Board evaluation

Conflicts of interest

Other ad hoc matters for consideration by the Board 
at both scheduled and unscheduled Board meetings 
in addition to the above include:

 – major potential acquisitions and disposals;

 – significant leasing arrangements;

 – approval of major developments;

 – significant financing arrangements;

 – Board and senior management appointments; and

 – appointment of principal advisors.

A forward agenda for the Board is maintained to ensure that 
all necessary and appropriate matters are covered during the 
year and to allow sufficient time for discussion and debate. 

The Board receives papers and presentations from the 
Executive Directors and senior managers are regularly 
invited to attend to provide further insight and feedback 
on specific matters.

Significant matters discussed and major transactions 
approved by the Board in the year are shown on pages 
108 and 109.

Where directors are unable to attend meetings, their 
comments, as appropriate, are provided to the Board 
or Committee Chairman prior to the meeting.

At least annually, the Board reviews the nature and 
scale of matters reserved for its decision.

Annual Report 2020  Great Portland Estates 101

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Leadership and purpose continued

Our purpose, values and culture
Our purpose is to unlock potential, creating space for 
London to thrive. In setting our purpose, we believe our 
role in creating space for London to thrive relates not only 
to our buildings, but also to the people who live and work 
there and what and how we contribute to the wider public 
realm and community. 

Our strong and positive culture is fundamental to how we 
perform and serves as the foundation to what makes GPE 
positively unique. 

In February 2019, following a Board sponsored and 
employee-driven initiative, we launched ‘Together We 
Thrive’ to all employees to articulate our purpose, values 
and the underlying behaviours by which we measure our 
values to preserve and strengthen our culture for the future. 
This important work has continued throughout the year 
to further embed and integrate the values and behaviours 
within the Group, our strategy, the way we do business 
and in everyday decision making. 
 › See more on how we do this in ‘Our culture and people’ on pages 46 to 53 

How the Board monitors culture

The Board is committed to ensuring that the tone of our 
values is set from the top by both the Board and the Senior 
Management Team. Our size and the high level of regular 
Board interaction with employees facilitates the Board’s 
monitoring of culture and the implementation of our 
values which we do in a number of ways:

 – inclusion of culture, values and behaviour-led 

questions within employee surveys with Board 
analysis of the results;

 – regular face-to-face engagement with employees 
as part of our Non-Executive Director breakfast 
programme, twice yearly employee engagement 
sessions, Board and Committee presentations, property 
tours and other meetings and engagements throughout 
the year (see ‘Engaging with our employees’ on page 
103 for more details); 

 – ‘Living Our Values’ is an integral part of every individual’s 

objective setting and annual performance reviews, 
with values-led performance outcomes being reported 
via the Remuneration Committee. This year we have 
introduced 360-degree feedback reviews for a wider 
cohort of senior management prompting open 
feedback on culture and values which then feeds into 
an individual’s personal development plan. For 2020/21, 
we have strengthened the link between the values and 
remuneration with a proportion of each employees’ 
personal bonus now explicitly based on values 
and behaviours;

 – the Executive Committee has regular ‘Living Our Values’ 
meetings with Heads of Department which are then 
discussed with the Board;

 – policies, pay and inclusion and diversity activities are 
reviewed to ensure they appropriately capture and 
reflect our values;

 – reviews of compliance, whistleblowing statistics, health 

and safety incidents and internal audit reviews to identify 
and address any areas not meeting expected standards 
of conduct or behaviour;

 – feedback from our stakeholder engagement 

programmes, including our occupier survey results, 
helps the Board to assess how the values and 
behaviours are embedded in our interactions with third 
parties and the way we do business; and

 – review of supplier payment practices, including most 

recently in the context of the COVID-19 crisis.

The Group’s response to the recent COVID-19 crisis has 
further demonstrated the strength of our collaborative 
culture and the commitment of our people to serve 
in the best interests of GPE, each other, and our 
wider stakeholders. 

Safeguarding our culture and further embedding our 
values remains a continuous area of focus for the Board. 
While our employee engagement survey this year showed 
high levels of engagement with our values following their 
launch last year, the survey also highlighted that there is 
more we can do to help drive the right behaviours through 
all of our activities. Further insight and employee views 
have been gained through externally facilitated focus 
groups which will help to inform our ongoing values-
based initiatives. 

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Stakeholder engagement

Engaging with our employees

Being a relatively small company of just over 100 employees 
operating in one location, there is a high level of visibility 
of the Board by employees and vice versa. Given this high 
level of engagement, we decided that we would not adopt 
any of the three specific employee engagement methods 
referred to in the 2018 UK Corporate Governance Code at 
this time. Instead, we have adopted the following employee 
engagement arrangements which the Board believes have 
operated effectively during the year to provide the Board 
with regular formal and informal employee feedback for 
consideration as part of the Board’s decision making process:

 – a formal programme of breakfast meetings between the 
Non-Executive Directors and members of the Executive 
Committee and Heads of Department. These meetings 
have no fixed agenda and provide a useful forum to 
discuss what is happening in day-to-day operations and 
the associated challenges which might not be significant 
enough individually to warrant formal reporting at Board 
meetings; and

 – a Non-Executive Director, on a rotational basis, presenting 
to all employees in a discursive format twice yearly on a 
particular theme, followed by a Q&A session. To facilitate 
these Q&A sessions we have set up a NED Q&A email 
address where questions may be raised anonymously in 
advance of the event as well as from the floor on the day. 
Our first ‘An audience with...’ session, which proved to be 
a great success, was held in October 2019 and included 
presentations by Richard Mully, Toby Courtauld and Rachel 
Aylett, our Head of HR, on the launch of GPE’s Inclusion 
and Diversity strategy and the actions underway to achieve 
the National Equality Standard. Hosted by Nick Sanderson, 
Alison Rose discussed her view of the current markets and 
other areas of Board focus, including inclusion and diversity, 
followed by a lively and interactive Q&A session with GPE 
employees covering a wide variety of topics. 

These sessions are also designed for Board members 
to provide the Board’s views, as appropriate, on matters 
raised through employee engagement and feedback 
from the sessions is reported to the Board.

Given the interactive nature of the sessions, our second ‘An 
audience with...’ session, which was due to be presented 
by Charles Philipps in March 2020, was postponed at late 
notice due to the COVID-19 crisis in the UK. This will now 
take place over the coming months.

In addition to these arrangements, direct Board engagement 
with employees during the year has included the following:

 – in September, property tours of The Hickman and 

200 Gray’s Inn Road as part of the annual Board property 
tour involving our Development, Project Management and 
Occupier and Property Services teams;

 – in addition to presentations made to the Board by the 
Executive Committee team at each scheduled Board 
meeting, Board presentations and Q&A sessions by 
Heads of Department and other employees on key matters 
including cyber security, health and safety, sustainability, 
financing, leasing, investor relations, inclusion and 
diversity and corporate governance;

 – Vicky Jarman attending our Investor Event with employees, 
shareholders and analysts in February and Charles Philipps 
attending our all-staff Sustainability Event in March; 

 – Toby Courtauld, Nick Sanderson and our Company 

Secretary presenting, with a Q&A session, on ‘everything 
you want to know about the Board and Executive 
Committee,’ which also included discussions on the work 
of the Remuneration and other Board Committees; 

 – all-staff Quarterly Review meetings led by our Chief 

Executive which provide an informal forum for employees 
to discuss and raise questions regarding key events at GPE. 
Richard Mully attended our April 2020 Quarterly Review, 
which was held via video-conference due to the COVID-19 
crisis, to hear employee views and to share the Board’s 
perspectives on recent events; and

 – in response to the implementation of remote working 

arrangements during the COVID-19 crisis, all employees 
have been invited to attend a weekly update call, led 
by our Chief Executive, to discuss key developments 
and concerns.

While the impact of COVID-19 has presented operational 
challenges for all businesses, we have adopted a number 
of initiatives and activities to maintain levels of employee 
engagement, wellbeing and feedback to ensure we can 
support our people during this unprecedented period.
 › See more on page 49

Engaging with our shareholders

As part of assuming the role of Chairman last year, 
Richard Mully offered to meet with our top ten shareholders 
representing almost 50% of the share register. These meetings 
have continued during the year and have allowed our Chairman 
to engage first hand with some of our largest shareholders. 

Richard, along with the full Board, also met with some of 
our retail shareholders at our 2019 AGM. The AGM provides 
the Board with an opportunity to speak with and answer 
questions from private and institutional shareholders during 
the formal meeting, and also more informally before the 
meeting starts. Regrettably, due to the COVID-19 crisis 
and the need for social distancing measures, this form 
of engagement may not be possible at this year’s AGM. 
That being the case, we would encourage shareholders 
to raise any questions of the Board ahead of the meeting, 
details for which can be found in our 2020 AGM Notice. 
The Board looks forward to once again meeting shareholders 
in person at future events, when circumstances allow.

We believe that communication with our shareholders is key. 
To this end, Richard Mully, together with Charles Philipps 
as Senior Independent Director, is available to meet with 
shareholders as appropriate and each of our Committee chairs 
is available to engage with shareholders on significant matters 
related to their area of responsibility. During the year, Wendy 
Becker, Chair of the Remuneration Committee, engaged with 
our 20 largest shareholders on the development of our revised 
Directors’ remuneration policy. 
 › See more on pages 66 and 128

The Board is supported by our comprehensive investor 
relations programme led by Toby Courtauld and Nick 
Sanderson involving roadshow meetings, meetings at 
industry conferences and investor and analyst events. 

Annual Report 2020  Great Portland Estates 103

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Leadership and purpose continued

We continue to shape our engagement 
with our shareholders to ensure we are 
clear and transparent in our communication 
and provide insight into the issues that are 
on their agenda.”

Stephen Burrows
Director of Financial Reporting 
and Investor Relations

Investor contact by location

4

15

105

United Kingdom
United States
Rest of Europe
Rest of World

55

179
meetings

Investor contact by method

6

3

8

109

53

179
meetings

Conference
Meeting
Call
Tour
Meeting and tour

A number of common topics were raised during our meetings 
with shareholders, including:

 – our view on the markets in which we operate; 

 – the impact of increasing demand for flexible spaces;

 – the growth prospects from our development pipeline;

 – the impact of structural retail changes on London; and 

 – changing occupier requirements including technology, 

sustainability and design.

We used these topics to shape both the content of 
subsequent investor presentations and the agenda 
of our Investor and Analyst Event. 

Furthermore, given the increased focus on sustainability, 
our Director of Sustainability and Community and Director 
of Financial Reporting and Investor Relations continued our 
outreach with a number of our larger investors to understand 
their views on the Group’s key ESG issues. In addition to this 
engagement, the Board believes that it is essential to provide 
transparent reporting and, therefore, we participate in a 
number of sustainability indices:

Relations with shareholders

Our approach

The Board aims to maintain an open relationship with 
our shareholders based on a clear investment case and 
transparent disclosure. As a result we maintain a regular 
dialogue with shareholders, potential shareholders, debt 
providers and analysts through a comprehensive investor 
relations programme. The programme is executed across a 
number of geographies, reflecting the international nature of 
our share register, and through a variety of routes including 
roadshows, meetings at industry conferences, investor and 
analyst events, property tours and presentations to analysts 
and investment banks’ equity sales teams. 

Institutional shareholders by geography at 31 March 2020

4%

23%

43%

United Kingdom
North America and Canada
Rest of Europe
Rest of World

30%

 › See more detail about our largest shareholders on page 156

The Board is also committed to providing investors with 
regular announcements of significant events affecting 
the Group, including its business activity and financial 
performance. These announcements are available on the 
Group’s website at www.gpe.co.uk along with results 
webcasts, analyst presentations, property videos, press 
releases and interviews with the management team.

The Executive Directors and the Director of Financial 
Reporting and Investor Relations are the Company’s principal 
representatives with investors, analysts, fund managers, press 
and other interested parties, and independent feedback 
on presentations by the Executive Directors to shareholders 
and analysts is provided to the Board on a regular basis. 

Activities during the year

In total, the directors and senior management had 179 formal 
meetings with shareholders and potential shareholders from 
more than 200 institutions during the year. This included 
participating in eight industry conferences, which provide 
the management team the ability to meet a large number 
of investors on a formal and informal basis, eight roadshows 
to meet with investors in London, the US, the Netherlands, 
Scotland and Australia and our Investor and Analyst Event 
in February 2020. We actively seek feedback after every 
roadshow which is provided to the Board on a regular basis.

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During the year, we consulted with shareholders on a number 
of topics. From October to December 2019 we sought 
shareholder views on our new Directors’ remuneration policy. 
Feedback was received on a number of areas, including 
support for the addition of ESG and stakeholder targets 
within the Executive Directors’ annual bonus measures 
to reflect the growing importance of sustainability to the 
future of the business; the introduction of post-employment 
share ownership guidelines for Executive Directors; and 
the alignment of Executive Director and workforce pension 
contribution rates. This feedback helped to shape our revised 
policy which shareholders will be asked to approve at this 
year’s AGM.

The Executive Directors and Corporate Finance Team also 
have regular dialogue with our debt providers, including 
relationship banks, private placement investors and debenture 
holders and report back to the Board as appropriate.

Investor and 
analyst event

We hold a biennial Investor and Analyst Event to provide 
an opportunity for the investment community to have 
a deeper dive on some of our activities and have the 
opportunity to hear from the wider GPE team.

This year the title of the event, which took place on 
13 February 2020, was ‘Evolving and Innovating’ and was 
intended to highlight a number of increasingly topical 
themes including utilising technology, the rise of the 
sustainability agenda, the changing nature of occupier 
requirements as well as an update on our markets.

We had ten presentations from the GPE team including 
panel sessions to provide a wider view from across our 
business. We were also joined by Faisal Butt from Pi Labs 
who provided insight into the rise of PropTech, Simon 
Booth of KKR who explained why they chose Hanover 
Square as their London HQ and Miles Keeping of 
Hillbreak who challenged our team on their progress on 
the sustainability agenda.

We had around 70 attendees and feedback from the 
event was positive and will contribute to our thinking 
for 2022.

What we did in 2019/20

2019

April/May

 – Investor roadshows: 
London, Amsterdam

 – Conferences:  

Peel Hunt

July

 – Annual General 

Meeting

November

 – Investor roadshow: 
London, Australia

 – Conferences: UBS 

(London)

 – Equity sales force 

meetings × 1

January

 – Roadshows: 
Amsterdam, 
Edinburgh

 – Equity sales force  

meetings × 1

March

 – Conferences:  

Citi (US), BAML 
(London)

 – Equity sales force 

meetings x 1

June

 – Investor roadshows: 

London, US 

 – Conferences:  

Morgan Stanley 
(London)

September

 –  Conferences:  

BAML (New York), 
EPRA (Madrid)

 – Equity sales force 

meetings × 1

December

 – Investor roadshow: 

US

 – EPRA Corporate 

Access Day 
(London)

 – Sell side Tour: 160 

Old Street

 – Equity sales force 

meetings × 1

February

 – Analyst and Investor 
Event: ‘Evolving and 
Innovating’

 – Equity sales force  

meetings × 2

2020

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Awards
We were pleased to be recognised in Institutional Investor’s 
‘All Europe Executive Team 2019’, being voted #2 Investor 
Relations Team in the European property sector (small 
and mid cap), and receiving top three individual rankings 
for our Chief Executive, Finance and Operations Director 
and Director of Financial Reporting and Investor Relations. 
We also won IR Magazine’s Award for ‘Best in Sector: 
Real Estate’. 

Annual Report 2020  Great Portland Estates 105

Faisal Butt, Founder and Chief Executive of Pi Labs

Leadership and purpose continued

Understanding the views of all our stakeholders 
and fostering of business relationships
In addition to the above employee and shareholder activities, 
the Board oversees and receives regular updates throughout 
the year on engagement activities with our other key 
stakeholders. The Board develops its understanding of these 
key stakeholder views in a number of different ways, including 
the following:

Occupiers – The Board meets occupiers where possible 
as part of its cycle of property tours. Board papers include 
regular updates on occupier engagement activities, including 
feedback from occupier meetings, which are periodically 
attended by Executive Directors, independent customer 
surveys, discussions with property agents, industry forums 
and events and marketing campaigns;

Communities – Our Community strategy, which is designed 
to create sustainable relationships with our London 
communities, is set by the Board with implementation 
overseen by our Communities and Charities Committee 
which is chaired by the Finance and Operations Director. 
The Board receives regular updates on activities and 
initiatives, including the annual GPE Community Day, and 
most recently approved the creation of the GPE COVID-19 
Community Fund;

Joint Venture Partners – Frequent engagement throughout 
the year is led by our Executive Directors, at least one of 
whom serves on each joint venture board, with regular 
updates and reporting of key matters to the Board;

Suppliers – Engagement is led through our Development, 
Leasing, Occupier Services, Health and Safety and 
Sustainability Teams with information received through 
regular Board reports and presentations. The Board engages 
directly with contractors during development site visits 
and may also receive external presentations from suppliers 
such as property agents and valuers. The Audit Committee 
reviews GPE’s supplier payment practices and performance 
twice yearly; and

Local Planning Authorities – Our relationships with key 
planning authorities are key to the delivery of new spaces 
in London. Our Development Director reports to the Board 
at each scheduled Board meeting on recent engagement 
activities, including planning discussions, community 
considerations and any development consultations involving 
key stakeholders and local residents.

Further details of our key stakeholder relationships describing 
how we have engaged with our various stakeholders during 
the year and how stakeholder issues have been monitored 
and considered by the Board through our scheduled 
Board meetings, and discussion of matters between these 
meetings, is explained in more detail in:

 – our stakeholder relationships on pages 58 to 66;

 – our culture and people on pages 46 to 53;

 – our approach to risk on pages 80 to 93; and

 – what we did in 2019/20 on pages 108 and 109.

How we behave, human rights, supplier 
stewardship and anti-corruption and 
anti-bribery matters
We aspire to the highest standards of conduct based on 
honesty and transparency in everything we do. Our Executive 
Committee has a high level of oversight over the Group’s 
day-to-day policies and procedures and carries out regular 
reviews of the appointment of contractors, consultants 
and suppliers. 

Whilst we do not have a separate human rights policy, we 
seek to avoid causing or contributing to adverse human 
rights impacts through our activities. In our business 
relationships, we look to demonstrate a commitment to 
fundamental human rights through our own behaviours 
and look to engage suppliers whose values and business 
principles are consistent with our own. Whilst we require all 
our suppliers to comply with standards and codes that may 
be specific to their industry, our Supplier Code of Conduct 
also sets out the additional standards that we require of our 
suppliers in this regard. GPE team members regularly meet 
with main contractors to share information on industry best 
practice about health and safety, employee pay ratios and 
responsible sourcing. 

In September 2019, we published our Modern Slavery Act 
Statement, which can be found at www.gpe.co.uk, setting 
out the steps we have taken over the past year and intend 
to take over the next 12 months to ensure our suppliers and 
their supply chains adopt similar standards to our own to 
prevent slavery and human trafficking taking place within 
our supply chain. 

Formal policies in place for the year in relation to anti-
corruption and anti-bribery matters include our Ethics, 
Whistleblowing and Gifts and Hospitality, Use of GPE 
Suppliers, Conflicts of Interest and our Inside Information and 
Share Dealing policies. All new employees receive one-to-one 
training on these policies as part of their induction process. 
A formal compliance statement relating to these policies is 
required to be signed-off by employees annually with any 
concerns reported to the Audit Committee. There were no 
matters to report to the Audit Committee in relation to these 
policies in the year ended 31 March 2020. 

The Audit Committee also reviews our Whistleblowing, 
Ethics and Gifts and Hospitality policies annually. This year 
our Ethics policy was updated to reflect our commitment to 
providing a working environment that is conducive to good 
mental health and to eradicate any stigma attached to mental 
health issues. Our Ethics and Whistleblowing policies can be 
found at www.gpe.co.uk/about-us/governance/. 

Whilst we consider our industry to be relatively low risk, 
in May 2019, we introduced a formal Anti-Money Laundering 
policy with specific training provided to employees 
as appropriate. 

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Our conflict of interest procedures
The Company’s Articles of Association allow the Board to 
authorise potential conflicts of interest that may arise and to 
impose such limits or conditions as it thinks fit. The Company 
has established a procedure whereby any actual and potential 
conflicts of interest that may arise from directors’ current 
and proposed roles with other organisations are regularly 
reviewed in respect of both the nature of those roles and 
their time commitment and for proper authorisation to be 
sought. A director who has a conflict of interest is not counted 
in the quorum or entitled to vote when the Board considers 
the matter in which the director has an interest. The Board 
considers these procedures to be working effectively.

Our approach to Board induction and development
All new directors receive a comprehensive induction 
programme over a number of months which is tailored to 
their individual roles and needs and which is designed to 
facilitate their understanding of the Group, its purpose, values 
and strategy, its corporate governance and the markets in 
which it operates. 

To enable the Board to discharge its duties, all directors 
receive appropriate and timely information, including briefing 
papers distributed in advance of Board meetings and regular 
property tours conducted by the relevant GPE teams. 

The directors may, at the Company’s expense, take 
independent professional advice and are encouraged to 
continually update their professional skills and knowledge 
of the business and wider industry. Senior managers and 
external advisors presented to the Board during the year 
on a range of subjects, including global economic and 
political risks and Brexit preparations; industry themes and 
developments; the global and UK real estate investment 
market; a deep dive into the flexible space market and 
GPE’s flexible space offering; property technology; 
health and safety; environmental and sustainability 
matters; cyber risk management; and accounting and 
governance developments. 

Directors also individually attend seminars or conferences 
associated with their expertise or responsibility, and are 
provided each quarter with a list of relevant upcoming 
seminars by various firms. The level and nature of training by 
the directors is reviewed by the Nomination Committee and 
development areas are discussed with individual directors as 
part of the annual performance evaluation process.

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Vicky Jarman joined the Board on 1 February 
2020 and is undertaking a tailored and 
comprehensive induction programme. 

“The induction process has been facilitated by the 
Chairman and the Company Secretary and has quickly 
developed my knowledge and deeper understanding 
of GPE, its values and culture. 

Upon appointment I received a tailored induction pack 
and a library of reference materials covering key areas 
including Board and Committee papers, strategy, finance 
and operations, governance and directors’ duties and risk 
management and internal controls. 

I have spent valuable time with the Chairs of each of the 
Committees and wider Board and I have had a structured 
programme of meetings with executives and senior 
managers from around the business to deepen my 
knowledge of their functions, as well as to understand 
current risks and opportunities.

Meeting with a number of advisors, including the 
internal and external auditors, brokers and remuneration 
consultants has also given me a valuable external 
perspective on the business. 

I attended GPE’s Investor and Analyst Event in February 
which was a great opportunity in my first weeks to hear 
from employees, shareholders, analysts and occupiers on 
their key areas of focus. 

Unfortunately my planned property tours of New City 
Court, City Place House and The Hickman have been 
deferred due to COVID-19 but I am looking forward to 
seeing more of GPE’s assets first hand and to learn more 
about our asset and development plans. 

Over the coming months I am excited to meet more of 
GPE’s passionate employees and to engage further with 
our wider stakeholders.“

Annual Report 2020  Great Portland Estates 107

Leadership and purpose continued

What we did in 2019/20
The table below provides examples of our significant discussions, transactions and appointments over and above the 
scheduled matters outlined on page 101, together with examples of our oversight of engagement with stakeholders and 
consideration of s.172 matters since April 2019. You can read our s.172(1) statement on pages 65 and 66.

2019

Strategy, 
governance, risk 
and opportunity 
management

April

May

July

August

 – Approval of a rent review 
at 45 Mortimer Street with 
New Look and a new letting 
of the entire 4th floor space 
to Brown Foreman

 – Approval to proceed with 

due diligence on a proposed 
property acquisition in light 
of market cycle read and 
enhancement of the long-term 
development pipeline

 – Received external presentations 

on global economic and 
political risks, the listed real 
estate landscape and the 
London office market to 
inform the Board’s strategic 
discussions and consideration 
of risks and opportunities

 – Review of health and safety 
risks, incidents occurring 
during the year, the impacts 
of regulatory changes 
and recommended actions 
to strengthen systems 
and procedures in both 
the development and 
occupied portfolio

 – Discussion of IT and cyber 
risk management and 
approval of an updated  
two-year IT strategy

 – Board tour undertaken of 
the proposed property 
acquisition, consideration of 
due diligence and approval 
of proposed actions

 – Review of activities being 
undertaken in relation to 
the development pipeline

 – Consideration of the 

evolution of the flex space 
offering in view of growing 
occupier preferences for 
fitted space and space 
provided on more flexible 
lease terms

 – Approval of extension 
of the Group’s £450m 
revolving credit facility, 
extending the availability 
of a flexible source of 
debt on agreeable terms

 – Review of property 

sales strategy

 – Consideration of flexible 

space offering and potential 
co-working partners 
 › See more on pages 40, 41 and 66

 – Approval of Wendy Becker’s 

proposed appointment 
as Chair of Logitech S.A. 
after having stepped down 
as non-executive director 
of NHS England

 – Discussion and approval 

of GPE’s energy and 
carbon targets

Understanding 
the views of 
stakeholders, 
the interests of 
employees and 
the fostering 
of business 
relationships

 – Consideration of GPE’s 

ESG materiality review and 
feedback from investors, 
occupiers and suppliers 

 – Approval of GPE’s ongoing 
actions in respect of climate 
change mitigation and 
enhanced external reporting 
to better inform stakeholders 
including, in particular, 
investors and occupiers

 – Consideration of discussions 
with suppliers in relation to 
Brexit on the development 
and investment portfolios, 
and both supplier and GPE 
actions being taken

 – Consideration of the feedback 
received from shareholders in 
meetings with Martin Scicluna 
and Richard Mully to introduce 
Richard Mully in his new role 
as Chairman

 – Consideration of 
discussions with 
freeholders in respect 
of buildings in the 
development pipeline

 – Discussion of feedback 
from meetings with 
top occupiers

 – Updates received on 
significant retailers’ 
trading outlooks

 – Noting of feedback on 
internal and external 
presentations made 
on GPE portfolio 
team activities

 – Decision to restart 
GPE’s flexible share 
buyback programme, 
returning surplus equity 
to shareholders
 › See more on pages 78 and 79

 – Discussion of feedback 
from investor meetings 
following the year end results

 – Consideration of the 

reports from institutional 
shareholder advisory bodies 
and their recommendations 
in connection with 
shareholder voting at the 
AGM and agreement 
that comments received 
on remuneration should 
be taken into account in 
setting GPE’s 2020 Director’s 
remuneration policy

 – Review of feedback 

from presentations to 
potential retail occupiers at 
committed developments

 – Discussion of feedback 
from planners and joint 
venture partners

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Great Portland Estates  Annual Report 2020

September

 – Approval of inaugural 

Health and Safety strategy
 › See more on page 63

 – Approval of a lease 

surrender with Bloomberg 
at 50 Finsbury Square 
ahead of their lease expiry 
in June 2020

 – Approval of commitment of 
up to £5 million to invest in 
Pi Labs European PropTech 
venture capital fund
 › See more on page 32

 – Approval of lease re-gear 
with Kurt Geiger at 24/25 
Britton Street to extend 
the term to 2035 

 – Discussion of flex 

space opportunities and 
product development;  
co-working partnerships, 
valuation considerations 
and resourcing needs

 – Board tour of The Hickman 
and 200 Gray’s Inn Road

 – Demonstration of the 
GPE workplace app 
designed to improve 
occupier experience 
and service levels
 › See more on page 69

 – Supported restructuring 
of occupier services team 
to better address both 
team and occupier needs, 
including for flexible 
space requirements

 – Noted recent discussions 
with GPE’s joint venture 
partners

2020

November

January

March/April

 – Approval of repayment 
of the third-party bank 
debt in GRP

 – Review of Brexit 
preparedness

 – Approval of Alison Rose’s 
proposed appointment 
to Chief Executive 
of The Royal Bank of 
Scotland Group plc

 – Review of key strategic 

considerations, including 
in relation to GPE’s flex 
space offering

 – Approval of a significant 
proposed pre-letting 
at 1 Newman Street

 – Preliminary discussion 

of a potential acquisition 
opportunity 

 – Discussion of key themes, 
risks and opportunities to 
be addressed as part of 
the 2020 Strategy Review

 – A deep dive presentation on 

GPE’s flexible space products, 
opportunities and resourcing 
requirements with consideration 
of evolving occupier needs

 – Approval of sale of 24/25 Britton 

Street for £64.5 million
 › See more on page 33

 – Approval of the appointment 

of Vicky Jarman as  
Non-Executive Director
 › See more on page 113

 – Discussion of impacts and 

response to COVID-19 crisis 
with external presentations 
on the macro environment 
and the UK real estate market 

 – Review of updated financial 

forecasts and scenario models

 – Discussion of Board Evaluation 
findings and recommendations

 – Review of IT and cyber and 

health and safety governance, 
risks and controls including 
an update on a recent health 
and safety incident 

 – Review of enhanced risk 
management framework 
and in-depth review of 
GPE’s principal risks
 › See more on pages 80 to 93

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 – Approval of GPE’s 

2019 Modern 
Slavery Statement

 – Review of upcoming 

Inclusion and Diversity 
strategy launch having 
regard to employee and 
investor feedback 
 › See more on pages 50 and 51

 – Following a health and 

safety incident at one of 
our development sites, 
review of feedback from our 
building contractor and the 
demolition contractor and 
actions proposed relating to 
the contractor and GPE teams 

 – Discussion of environmental 
sustainability as an increasingly 
important commercial issue 
driven by growing occupier 
and investor demand. Review 
of the development of GPE’s 
programme of ESG-related 
activities

 – Consideration of feedback 

 – Approval of new £450 million 

from all-staff Board 
engagement session 
and Inclusion and Diversity 
strategy launch in October

 – Review of the Community Day 
held in September in support 
of Groundwork London and 
Centrepoint with high levels 
of staff participation
 › See more on pages 60 and 61

ESG-linked RCF aligned 
to ambitious sustainability 
targets and growing 
stakeholder sentiment
 › See more on pages 66 and 78

 – Consideration of an update 

on people and culture, GPE’s 
employee engagement survey 
results and ongoing work to 
further embed GPE’s values

 – Consideration of stakeholder 
engagement and support 
during COVID-19 crisis 
including in relation to: revised 
rental payment arrangements 
as appropriate; the continued 
operation of occupied 
buildings and development 
sites; maintaining payments 
to suppliers; employee 
wellbeing; and supporting 
our communities through 
Centrepoint and the GPE 
COVID-19 Community Fund

 – Review of sustainability 

Statement of Intent
 › See more on page 72

 – Consideration of the results 
of GPE’s second Occupier 
Satisfaction Survey and 
approved conducting the 
survey on an annual basis
 › See more on page 59

 – Discussion of feedback 
from engagement with 
central London retailers 
as part of New Bond Street 
marketing strategy

 – Review of feedback from 
institutional shareholder 
meetings following half 
year results

 – Review of feedback from GPE 

Investor and Analyst Event held 
in February and following April 
trading update

 – Review of the recommended 

actions arising from the recent 
Occupier Satisfaction Survey

 – Noted feedback from senior 
management strategy and 
‘Living Our Values’ session

 – Discussion of feedback 
received from the 2020 
remuneration policy 
consultation, with the 
Remuneration Committee 
subsequently developing 
the policy further in response 
to investor feedback
 › See more on page 66

Annual Report 2020  Great Portland Estates 109

Division of responsibilities

The role of the Board and its Committees during the year

Board

 – six scheduled meetings a year

 – sets strategy

 – provides oversight of purpose, culture 

and risk

 – approves major transactions

 – provides oversight of governance
 › See Board activities on pages 101 to 109 
 › See biographies of the directors on pages 54 and 55 
 › See the division of responsibilities of the directors 

on page 111

Board Committees

Audit Committee

Remuneration Committee

Nomination Committee

 – four scheduled meetings a year

 – five scheduled meetings a year

 – five scheduled meetings a year

 – oversees financial reporting

 – establishes remuneration policy

 – recommends Board appointments

 – monitors risk management and  

 – sets executive remuneration schemes

internal controls

 – reviews Executive Committee member 

 – scrutinises activities and performance of 

objectives and achievements

the external auditor

 – evaluates internal auditor and audit plan
 › See Audit Committee report  
 ›  See risk management report  

on pages 118 to 125

on pages 80 to 93

 – approves senior management 
remuneration and LTIP awards

 – approves executive bonus plan  

and LTIP targets

 – approves the Directors’ 
remuneration report

 › See Directors’ remuneration report  

on pages 126 to 154

Management Committees

 – approves senior 

management appointments

 – oversees succession planning and 
development of a diverse pipeline

 – responsible for Board 

effectiveness evaluation

 › See Nomination Committee report  

on pages 112 to 117

Executive Committee

Sustainability Committee

 – meets weekly

 – implements the 
Group’s strategy

 – oversees transactions

 – monitors risks 

and opportunities

 – responsible for succession 
planning, resourcing and 
people development

 › See Strategic Report  
on pages 1 to 94

 – meets four times a year

 – provides oversight on climate 

change risk and resilience

 – reviews progress 
and development 
of sustainability strategy

 – monitors 

environmental compliance
 › See Sustainability on our website  
www.gpe.co.uk/sustainability

Health and 
Safety Committee

Community and 
Charity Committee

 – meets four times a year

 – meets four times a year

 – reviews the Group’s health 
and safety compliance 
and performance

 – provides oversight on 

Health and Safety strategy

 – identifies and 

reviews opportunities 
for improvement

 › See Sustainability on our website  
www.gpe.co.uk/sustainability/ 
working-safely

 – oversees the implementation 

of the Group’s 
community strategy

 – ensures that charitable 
donations made are in 
accordance with the Group’s 
charitable donations policy

 › See Strategic Report  
on pages 1 to 94

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Great Portland Estates  Annual Report 2020

The division of responsibilities of the directors
The Board comprises the Non-Executive Chairman, two Executive Directors and five independent Non-Executive Directors 
and is supported by the Company Secretary. The Chairman and the other Non-Executive Directors meet regularly without the 
Executive Directors, and at least once a year the Non-Executive Directors meet without the Chairman. In addition, individual 
directors meet routinely outside the formal Board meetings as part of each director’s contribution to the delivery of the 
Company’s strategy and review of operations.

The Executive Directors meet weekly with senior management as the Executive Committee, chaired by the Chief Executive, 
to attend to the ongoing management of the Group. The Executive Committee makes decisions within the parameters set out 
in the Group’s Delegated Authorities which govern the taking and escalation of significant decisions. Significant operational 
and market matters are communicated to the Non-Executive Directors on a timely basis outside of the Board meetings. 
All directors have access to the advice and services of the Company Secretary, who is responsible to the Chairman on matters 
of corporate governance.

Each year the Schedule of Board Responsibilities and terms of reference for the roles of Chairman, Chief Executive 
and Senior Independent Director are revisited by the whole Board and are available on the website at  
www.gpe.co.uk/about-us/governance. 

Roles and responsibilities of the directors:

Chairman

Chief Executive

Finance and  
Operations Director

Senior Independent Director

Non-Executive Directors

Richard Mully, as Chairman, is responsible for leading the Board and for its effectiveness, 
meeting with shareholders as appropriate, ensuring a culture of openness, transparency 
and debate and helping the Chief Executive ‘to set the tone from the top’ on the Company’s 
purpose, values and culture. As part of his role in leading the Board, he ensures that the 
Board provides constructive input into the development of strategy, understands the 
views of the Company’s other stakeholders and provides appropriate oversight, challenge 
and support.

As Chairman, Richard also leads the Nomination Committee.

Toby Courtauld, as Chief Executive, is responsible for setting the Group’s strategic direction, 
implementing the agreed strategy, the operational and financial performance of the 
Group and the day-to-day management of the Company, including setting the tone for, 
and ensuring oversight of, the Company’s culture through ‘living the values’ and ensuring 
the Board is aware of other stakeholders’ views. As part of his role, Toby is responsible for 
leading the Executive and Sustainability Committees. 

Nick Sanderson, as Finance and Operations Director, supports the Chief Executive in 
developing and implementing the Group strategy and all financial matters. As part of his 
operations role, Nick has responsibility for oversight of the valuation process, leads the 
Health and Safety and Communities and Charities Committees and has Board responsibility 
for Health and Safety, HR and IT.

Charles Philipps, our Senior Independent Director, acts as a sounding board for the 
Chairman, leads the other independent Non-Executive Directors in the performance 
evaluation of the Chairman and is available to shareholders as required. As part of his 
role, he also acts as an intermediary for the Non-Executive Directors if necessary and 
is an independent point of contact in the Group’s whistleblowing procedure. As Senior 
Independent Director, Charles is also responsible for the Chairman succession process, 
working closely with the Nomination Committee.

Wendy Becker, Nick Hampton, Vicky Jarman and Alison Rose, as Non-Executive Directors, 
are responsible for bringing an external perspective and providing constructive challenge 
and support to the Board’s deliberations and decision making using their broad mix of 
business skills, knowledge and experience acquired across different business sectors. 
They are also responsible for monitoring the delivery of the agreed strategy within the risk 
management framework set by the Board and promoting high standards of integrity and 
corporate governance. Wendy Becker and Nick Hampton are responsible for leading the 
Remuneration Committee and Audit Committee respectively. Each Committee Chair seeks 
engagement with shareholders, as appropriate, on significant matters relating to their areas 
of responsibility.

The biographical details of the directors can be found on pages 54 and 55 which show the breadth of their skills and 
experience, why their contribution is important to the Company’s long-term sustainable success, and their membership 
of the Company’s various Committees.

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Annual Report 2020  Great Portland Estates 111

Composition, succession and evaluation

Nomination Committee

Nomination Committee members and attendance in 
2019/20

Our process
The Nomination Committee Terms of Reference 
are available on the Company website at  
www.gpe.co.uk/about-us/governance.

Chairman
Richard Mully
Members
Charles Philipps
Wendy Becker
Nick Hampton
Vicky Jarman1
Alison Rose2

5/5

5/5
5/5
5/5
1/1
4/5

1.  Vicky Jarman became a member of the Committee on 1 February 2020 

and was eligible to attend one meeting during the year.

2.  Alison Rose was unable to attend one meeting due to the unexpected 
ill-health of a family member. Alison separately provided comments 
on meeting items to the Committee Chairman.

Our approach
The key objectives of the Committee are to regularly 
review the skills and experience of the Board to ensure 
that it is the right size, structure and composition taking 
into account the skills, experience, independence, 
knowledge and diversity of directors and the future 
strategy of the Group.  It is the Committee’s role to 
consider succession planning for the Board and senior 
executives below Board level, to oversee the development 
of a diverse pipeline for succession and to lead on the 
process for Board appointments.

As part of these objectives, the Committee reviews 
and ensures that actions identified by the Board 
evaluation process are appropriately followed up, 
recommends to the Board the composition of the Audit, 
Nomination and Remuneration Committees taking into 
consideration individuals’ experience, ongoing training 
and development and time commitments, and the 
re-election of directors by shareholders at the Annual 
General Meeting.

The Nomination Committee membership generally includes 
all of the Non-Executive Directors. At the beginning of the 
year, the Nomination Committee comprised the Chairman 
of the Board, Richard Mully, and four independent Non-
Executive Directors, namely Charles Philipps, Wendy Becker, 
Nick Hampton and Alison Rose. Vicky Jarman became a 
member of the Committee on 1 February 2020.

In making any recommendations for Board appointments, the 
Nomination Committee consults with the Chief Executive and 
other members of the Board as appropriate. During the year, 
Toby Courtauld and Nick Sanderson were invited to attend 
Nomination Committee meetings to provide the Committee 
with updates on human resourcing and succession planning 
and to provide their input into the succession planning 
process for Non-Executive Directors. 

In making recommendations to the Board on  
Non-Executive Director appointments, the Nomination 
Committee specifically considers the expected time  
commitment of the proposed Non-Executive Director  
and other commitments they already have. Agreement  
of the Board is also required before a director may accept 
any additional commitments to ensure possible conflicts 
of interest are identified and that the directors will continue 
to have sufficient time available to devote to the Company. 
During the year, the Board carefully considered the 
appointment of Wendy Becker to the Board of Sony 
Corporation and as Chair (previously non-executive director) 
of Logitech International S.A. along with her stepping 
down as a non-executive director of NHS England, and 
the promotion of Alison Rose to CEO of The Royal Bank 
of Scotland Group plc. The Board was satisfied that these 
changes would not impact Wendy or Alison’s independence 
and that in each case they would continue to be able to 
devote appropriate time and add significant value to their 
respective roles at GPE.

Non-Executive Directors are not appointed for specific 
terms, but following the UK Corporate Governance Code, 
are subject to annual re-election and all proposed re-
elections to the Board are formally considered by the 
Nomination Committee taking account of each individual’s 
effectiveness and commitment to the role. In addition, the 
Nomination Committee reviews the recommendations 
of the Board evaluation process and progress against 
the recommendations from the previous year.

Directors’ tenure (as at 31 March 2020)

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Toby Courtauld
Nick Sanderson
Richard Mully
Charles Philipps
Wendy Becker
Nick Hampton
Vicky Jarman
Alison Rose

 Executive Directors 

 Non-Executive Directors

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Great Portland Estates  Annual Report 2020

17 years 11 months

8 years 8 months

3 years 5 months

6 years

3 years 2 months

3 years 6 months

2 months

2 years

This year our focus has been on the 
recruitment of additional Non-Executive 
Directors, oversight of wider succession 
planning and further initiatives to develop 
a diverse pipeline for succession.”

Richard Mully
Chairman of the Nomination Committee

Dear fellow shareholder
On behalf of the Nomination Committee, welcome to 
the Report of the Nomination Committee for the year 
ended 31 March 2020. This year our focus has been on 
the recruitment of additional Non-Executive Directors, 
oversight of wider succession planning and further 
initiatives to develop a diverse pipeline for succession.

Board composition 
There have been a number of changes to the Board 
and its Committees during the year. 

We have continued to focus on appropriate ongoing 
succession of the Non-Executive Directors. As part of this 
process, it was unanimously agreed in the year that we should 
appoint a Non-Executive Director with relevant financial 
experience in addition to a Non-Executive Director with 
relevant property experience. Following confirmation that 
they would not be conflicted, we appointed Russell Reynolds 
to help us with these two searches. Russell Reynolds has no 
connection with the Company or any individual directors 
other than to assist with Executive and Non-Executive 
succession planning and appointment processes. 

In respect of the search for a Non-Executive Director with 
relevant financial experience, the Committee considered 
an initial shortlist of candidates. Following interviews with 
myself and further discussions with the Committee, the list 
was reduced to two preferred candidates. It was agreed 
with the Committee that Charles Philipps, Wendy Becker 
and Nick Hampton should meet with the refined shortlist 
of candidates, after which the preferred candidate should 
meet with Toby Courtauld and Nick Sanderson prior to any 
recommendation being made to the Board. Following this 
process, we were delighted to welcome Vicky Jarman to the 
Board on 1 February 2020, from which date Vicky also joined 
the Audit, Nomination and Remuneration Committees. 
Vicky brings with her significant financial, commercial and 
non-executive knowledge and experience which enables 
her to contribute to the long-term sustainable success and 
strategy of the business. 

The search for an additional Non-Executive Director with 
relevant property experience is ongoing and we hope 
to announce the appointment of a new Non-Executive 
Director in due course.

Following the appointment of Vicky Jarman to the Board 
and a review of our Board Committee memberships, the 
following changes were made to the composition of the 
Board’s Committees: I stepped down as a member of the 
Remuneration Committee from 27 February 2020, although 
I will continue to attend meetings as appropriate, save where 
my own remuneration is under consideration. Wendy Becker 
will step down as a member of the Audit Committee 
with effect from 9 June 2020, following the signing of the 
2020 Annual Report and financial statements, and again 
continues to have an open invitation to attend meetings 
where appropriate.

Succession planning and talent development
During the year, in addition to the Board process described 
above, we have considered the development plans and 
succession planning for Executive Directors as well as for 
members of the Senior Management Team.

Recognising and developing our top talent is key to 
ensuring that we have a healthy and diverse pipeline of 
current and potential future leaders. This year we were 
delighted to endorse the promotions of: Janine Cole to 
Director of Sustainability and Community; Helen Hare 
to Director of Project Management; David O’Sullivan to 
Director of Occupier and Property Services; and Lisa Day 
to Head of Occupier Services. These promotions reflect the 
demonstrated successful leadership of Janine, Helen, David 
and Lisa within their respective teams, combined with the 
strategic and operational importance of the functions that 
they lead. We have further strengthened our senior team 
through a number of recent and important external hires, 
including the appointments of Alexis George as our Head 
of Health and Safety, Rebecca Bradley as Head of Property 
Services and the appointment of Anisha Patel as our Head 
of Marketing. More recently, Piers Blewitt was promoted 
to Head of Planning Strategy and Senior Development 
Manager to lead a more holistic approach to the planning 
process across our portfolio.

To strengthen GPE’s increasing focus on customer experience 
and higher service provision, the Committee also supported 
the realignment of the operating structure of our Occupier 
and Property Services team in the year. 

The Board and Committee remain focused on talent planning 
and the development of a diverse succession pipeline. 
To ensure this is given appropriate time and focus, this 
year we extended the number of scheduled Nomination 
Committee meetings from four to five. 

Over the coming year, the Committee will be overseeing 
the development of a new Non-Executive Director 
mentoring programme to enable members of our 
talented team to benefit from the advice and experience 
of our Non-Executive Directors.

Further details on GPE’s talent development programme 
can be found on pages 46 to 53. 

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Annual Report 2020  Great Portland Estates 113

Composition, succession and evaluation continued

Our approach to inclusion and diversity
We recognise the strategic importance of a diverse Board 
and workforce which is representative of our stakeholders 
and which provides different perspectives to support the 
development and delivery of our strategy both now and in 
the future. Our inclusive culture provides a solid foundation 
for our approach to diversity, both of the Board and the 
wider business. 

Recognising the benefits of a diverse Board, we currently 
have 37.5% female representation on the Board. While the 
Nomination Committee continues not to set specific 
representation targets, our policy on recruitment is that we 
expect our search consultants to ensure, where possible, that 
at least 30% of potential candidates are women, in line with 
our overall intention to strive for improved gender balance on 
the Board. This approach to recruitment is mirrored across 
the business to help to develop a strong pipeline of women 
within GPE at all levels, which is further supported by our 
talent development programme. 

We are pleased to have seen the positive benefits of this 
approach, with women today representing 37.5% of the 
Board’s composition, 44% of the Senior Management Team 
below the Executive Committee and 47% of all promotions 
over the last two years. 

Our Board composition is in line with the recommendations 
of the Hampton-Alexander Review and we are making 
some good progress across the organisation. However, we 
fully recognise the need to improve diversity amongst our 
Executive Committee and this remains a key area of focus. 
Further details regarding GPE’s gender diversity, including 
the gender balance of the Executive Committee and their 
direct reports, can be found on page 50. 

The benefits of broader diversity characteristics such as 
age, ethnicity, core skills, experience and educational and 
professional background also continue to be an active 
consideration in all recruitment. While the Board does 
not currently have any directors from an ethnic minority 
background, we are supportive of the Parker Review and 
remain mindful of its recommendations for boards of FTSE 
250 companies to have at least one director from an ethnic 
background by 2024.

Inclusion and diversity remain high on the agenda as we 
continue to oversee the many initiatives underway at GPE 
to build a diverse talent pipeline and strengthen diversity 
at a senior level and across the organisation. 

During the year the Committee oversaw the development of 
GPE’s first Inclusion and Diversity strategy and, in October 
2019, Alison Rose and I were proud to attend the launch 
of the strategy at an all-staff event. Our strategy is built on 
five core areas: our Culture; Engagement; Employment 
Practices, Policies and Procedures; Internal Interventions; and 
our Sector. We were pleased to have achieved the National 
Equality Standard accreditation in April 2020, reflecting the 
advancements we are making in this area. The Committee 
continues to drive and oversee progress against our Inclusion 
and Diversity strategy, further details of which can be found 
on pages 50 and 51. 

GPE’s Board composition and independence
As at 31 March 2020, the Board comprised the Chairman, 
two Executive Directors and five Non-Executive Directors. 
The biographies of all members of the Board outlining the 
experience they bring to their roles are set out on pages 
54 and 55. The roles each of the directors play on the 
Board are outlined on page 111.

All proposed re-elections to the Board are formally 
considered by the Nomination Committee, taking 
account of each individual’s continued effectiveness and 
commitment to the role. Following this review, I can confirm 
that each of the Non-Executive Directors is considered 
effective in their roles and both independent of the 
Executive Management and free from any business or 
other relationship which could materially interfere with 
their exercising of independent judgement.

Committee effectiveness review
Boardroom Review Limited was appointed to undertake 
an external evaluation of the Board and its Committees 
in 2019/20. Details of the review and its findings can be 
found on pages 115 and 116.

Richard Mully
Chairman of the Nomination Committee 
9 June 2020

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Great Portland Estates  Annual Report 2020

Our 2019/20 Board evaluation process 
In accordance with the requirements of the Code, we 
undertake a review of the effectiveness of the Board’s 
performance and that of its Committees and directors every 
year, with an external evaluation held every three years. 
Our progress against the actions identified through the 
2018/19 internal review are set out on page 116.

The 2019/20 Board and Committee effectiveness review was 
facilitated by Dr Tracy Long of Boardroom Review Limited 
(BRL), an external board evaluation specialist, between 
September 2019 and April 2020. Dr Long also undertook our 
2013/14 and 2016/17 reviews. In considering who to appoint, 
we felt that by having some familiarity with how the Board 
had worked in the past, Dr Long would be best placed to 
also consider whether there was anything we needed to 
change in how we operate as a Board and to prepare for the 
future as the business and strategy evolve. Neither Dr Long 
nor BRL have any other connection with the Company or 
any individual director. 

The aim of the review was to assess the effectiveness 
of the Board and individual directors in order to identify 
any actions to improve how we can fulfil our duties and 
become a more effective Board. 

The review was designed to encourage directors to optimise 
their contribution to the success of GPE and to maximise 
the value they add beyond statutory requirements, by 
building on current strengths and agreeing and preparing 
for the challenges ahead. The process also considered the 
effectiveness of individual directors and one-to-one feedback 
and advice was given to directors by Dr Long at the end of 
the process.

As part of the review, Dr Long conducted individual 
interviews with directors which typically lasted two 
hours, as well as interviews with other members of 
the Executive Committee.

The review focused on a number of key areas: 

 – Leadership and Contribution – including Board culture and 
composition; the roles of the Chair and Chief Executive; the 
use of time and information; and Non-Executive Director 
engagement and horizon scanning; and

 – The Work of the Board and its Committees – including 
the Board’s approach to strategy; risks and controls; 
corporate culture and stakeholder communications.

The following Board Evaluation process was adopted

2019

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September/October

BRL appointment

BRL appointed to facilitate the evaluation and briefed 
by the Chairman and Company Secretary on key themes 
and objectives

January/February

Interviews

One-to-one meetings held between Dr Long and 
individual members of the Board. Meetings were 
also held between Dr Long and other Executive 
Committee members

Meeting observation

Dr Long attends the January Board, Remuneration and 
Nomination Committee meetings and the February 
Nomination and Audit Committee meetings

May

Nomination Committee meeting

The Committee further considers the recommendations 
from Dr Long’s review 

December

Preparatory work

BRL provided with access to Board, Committee 
and other governance-related papers 

2020

April

Review of draft report with the Chairman 

Dr Long and Richard Mully discuss Dr Long’s draft report

One-to-one feedback 

Dr Long provides one-to-one feedback to individual 
members of the Board 

Board meeting presentation 

Dr Long presents her findings to the Board for discussion

Annual Report 2020  Great Portland Estates 115

Composition, succession and evaluation continued

The review concluded that the Board, its Committees 
and individual directors continue to operate effectively. 

Some of the key strengths identified included:

 – a supportive and transparent Boardroom culture 

with strong leadership from the Chairman, 
high levels of engagement and contribution, 
constructive challenge and diversity of perspective;

 – efficient Board and Committee meeting 

management with a clear focus on priorities;

 – a strong approach to strategy with due consideration of 
the changing needs and expectations of stakeholders;

 – a disciplined risk and control framework, with clear 
financial metrics and operational parameters; and

 – GPE has a strong, open and identifiable culture 

which is set by the Board and which flows through 
the organisation.

The review identified some recommendations and 
opportunities and the key areas of focus for 2020/21 
are set out below.

2020/21 actions

 – To consider broadening the Board’s property industry 
experience, the process for which is currently underway

 – Further testing and agreeing the Board’s strategic 

priorities and risk appetite as opportunities emerge 
in a changing market

 – Continued focus on talent management, Executive 
succession planning and diversity by the Board and 
Nomination Committee

 – Deepening the Board’s insight and understanding 
of the impact of technology changes across the 
sector and supply chain 

 – Audit Committee to oversee actions identified 

for the improvement of the risk register

 – Reducing repetition in operational papers and 

presentations to the Board

Progress against 2018/19 Board evaluation actions for 2019/20

2019/20 actions

Progress

Given the market uncertainty, 
for the Board to spend more 
time on ‘blue sky thinking’ 
and identification of possible 
emerging risks

Additional time is scheduled at Board meetings to discuss broader strategic matters, 
emerging risks and opportunities 

Executive Committee members summarise at each scheduled Board meeting the 
three matters about which they are most pleased and the three matters about which 
they are most concerned

External guest speakers invited to attend Board meetings and dinners in the year 
to provide external perspectives and disrupt thinking

Board time dedicated to discussing the potential impacts of COVID-19 in the short 
and longer term

Actions identified to ensure 
that the Board improves its 
understanding of a wider 
set of stakeholders

‘An audience with...’ Board-employee engagement sessions launched in 2019. 
NED breakfasts extended to include a wider reach of employees. Employee survey 
results showing very high levels of engagement with Employee Engagement Index 
score at 91% 

Greater discussion of major occupier feedback and occupier survey results with 
agreement to undertake the survey on an annual basis. Deep dive presentation 
received on the flexible space market

Board site visits to understand more challenging refurbishments, including at 
200 Gray’s Inn Road

Board papers for key decisions now include a specific section reviewing the impact of 
the proposal on relevant stakeholder groups as well as other s.172(1) considerations

Vicky Jarman appointed to the Board on 1 February 2020 with an additional search 
underway for an additional Non-Executive Director with relevant property experience

Launch of Inclusion and Diversity strategy in October 2019 and continued oversight 
of initiatives. National Equality Standard accreditation achieved in April 2020

Additional Nomination Committee meeting added to Board schedule to allow for 
increased focus on diversity, talent development and succession planning

Continued focus on Board 
succession planning and 
the development of a 
diverse pipeline

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What we did in 2019/20

2019

April

Board Meeting

The Board and Committee memberships are approved

September

Nomination Committee

The Committee agrees the Executive Director 
succession planning process

The Committee receives an update on Non-Executive Director 
succession planning and agrees to retain Russell Reynolds 
to undertake a search for one Non-Executive Director with 
relevant property experience and another with relevant 
financial experience based on specified skills, expertise and 
experience

January

Nomination Committee

The Committee agrees to recommend the appointment of 
Vicky Jarman as a new Non-Executive Director

The Committee discusses the role specification and a long list 
of potential candidates for a new Non-Executive Director with 
relevant property experience

The Committee reviews the status of recommendations 
from the Board evaluation 2018/19

Board meeting

Board approval is granted for the appointment of Vicky Jarman

May

Nomination Committee

The Committee considers the personal development plans 
of the Executive Directors

The Committee approves the Inclusion and Diversity strategy 
and implementation plan and activities to help develop 
a diverse succession pipeline. The Committee reviews and 
approves GPE’s Diversity policy and maternity and paternity 
pay policy

The Committee discusses Executive Director succession 
planning

Richard Mully provides an update on the search process 
for a new Non-Executive Director

November

Nomination Committee

The Committee discusses the outputs from the Executive 
Director succession planning exercise

Toby Courtauld provides an update on the development 
of the Executive Committee members

The Committee approves the shortlist of candidates 
for a new Non-Executive Director with financial experience

The Committee discusses senior management talent planning 
and development and supports three senior promotions 
and the restructuring of the Occupier Services team

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2020

February

Nomination Committee 

Richard Mully provides the Committee with an update 
on progress of the Non-Executive Director search

The Committee reviews the Group’s Diversity policy and 
receives an update from Rachel Aylett, Head of HR on 
progress against the Inclusion and Diversity strategy and 
recommended next steps. The Committee also reviews 
progress against the National Equality Standard

The Committee reviews Board Committee memberships 
and training undertaken by the Board during the year

The Committee reviews the Nomination Committee 
Terms of Reference

Annual Report 2020  Great Portland Estates 117

Audit, risks and internal controls

Together the Audit Committee and the Board are responsible 
for ensuring the Group has an effective internal control and 
risk management system and that the Annual Report provides 
a fair reflection of the Group’s activities during the year.

Internal controls and ongoing risk management
The Board is responsible for maintaining and monitoring 
the Group’s system of internal control and, at least annually, 
reviewing its effectiveness.

Such a system can only provide reasonable, and not absolute, 
assurance against material misstatement or loss, as it is 
designed to manage rather than eliminate the risk of failure 
to achieve business objectives.

The identification and management of risks and opportunities 
is part of the mindset of all employees at GPE with ongoing 
processes and procedures in place for identifying, evaluating 
and managing the principal and emerging risks faced by the 
Group. These processes and procedures have been further 
enhanced during the year and accord with the Financial 
Reporting Council’s Guidance on Risk Management, Internal 
Control and Related Financial and Business Reporting.

Key features of our system of internal control include:

 – a comprehensive system of financial reporting and 

business planning;

 – a defined schedule of matters for decision by the Board, 

revisited by the Board at least annually;

 – an organisational structure with clearly defined levels 

of authority and division of responsibilities;

 – formal documentation of procedures;

 – the close involvement of the Executive Directors and the 

other Executive Committee members in all aspects of day-
to-day operations, including regular meetings with senior 
managers to review all operational aspects of the business 
and risk management systems;

 – Executive Committee reporting on control systems to the 
Audit Committee and Board, including to annually confirm 
its view on whether GPE’s internal controls, and broader 
control environment, are operating effectively;

 – Board review of Group strategy including forecasts of the 
Group’s future performance and progress on the Group’s 
development projects at each scheduled Board meeting;

 – formal sign-off on the Group’s Ethics, Gifts and Hospitality 
and Whistleblowing policies by all employees annually; and

 – review by the Audit Committee of Internal Audit’s reports 

and reports from the external auditors.

Twice a year, the Audit Committee carries out a review 
of the framework of the Group’s risks and how they are 
managed through key operational controls, ongoing 
review by the Executive Committee, and ongoing Board 
review and oversight. For the 2020 year end, the Audit 
Committee and Board oversaw an in-depth review of the 
Company’s risk management framework and principal risks 
which identified a number of new principal and emerging 
risks, reframed some of our principal risk descriptions 
and further strengthened our risk management framework 
and processes. 

The Group’s systems of risk management and internal 
controls involves the identification of business and financial 
market risks including social, ethical and environmental issues 
which may impact on the Group’s objectives, together with 
the controls and reporting procedures designed to minimise 
those risks. 

The Audit Committee formally considers the key controls 
forming the Group’s system of internal control and 
whether these are considered to be operating effectively. 
Once complete, the Audit Committee’s review of the Group’s 
risks and internal controls is considered by the full Board. 

During the year, the Board and the Audit Committee have 
continued to review and monitor the risks, potential impacts 
and GPE’s preparations associated with the UK’s exit from 
the EU, and international trade negotiations following Brexit, 
including in relation to GPE’s operations, development 
delivery, valuations, financial forecasts and business plans.

The Audit Committee and Board have further considered 
the Group’s risks and internal controls in the context of the 
COVID-19 crisis and reviewed additional controls which 
have been implemented in response to the crisis. Given the 
significant impact of COVID-19 on the business and the wider 
economy, ‘Pandemic’ has been added to our principal risk 
register as a new principal risk. 

Both COVID-19 and the UK’s exit from the EU have been 
considered in the context of our viability assessment set 
out on page 94.

The Group’s updated principal risks and the processes in 
place to manage those risks are described in more detail 
on pages 80 to 93.

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Great Portland Estates  Annual Report 2020

Fair, balanced and understandable – a matter 
for the whole Board
The directors’ statement on ‘fair, balanced and 
understandable’ is made on page 158. When considering 
whether the 2020 Annual Report and financial statements are 
fair, balanced and understandable, and provide information 
necessary for shareholders to assess the Group’s position, 
performance, business model and strategy, the Board takes 
into account the following:

 – the Chairman and Chief Executive provide input into and 
agree on the overall messages and tone of the Annual 
Report at an early stage;

 – individual sections of the Annual Report and financial 

statements are drafted by appropriate senior management, 
with regular review meetings to ensure consistency of the 
document as a whole;

 – detailed reviews of appropriate draft sections of the 

Annual Report and financial statements are undertaken 
by the Executive Directors and other members of the 
Executive Committee;

 – a draft is reviewed by the Audit Committee and the 

external auditor on a timely basis to allow for sufficient 
consideration and is discussed with the Finance and 
Operations Director and senior management prior 
to consideration by the Board; 

 – the Finance and Operations Director, in his year-end 

Audit Committee and Board papers, includes a checklist 
of areas that the Committee and Board should take into 
consideration (including successes and challenges over 
the year and looking ahead) when reviewing the fairness, 
consistency and balance of the final draft of the Annual 
Report and financial statements, including whether there 
are any significant omissions of information; and

 – the Audit Committee provides advice to the Board 

on whether, taken as a whole, the Annual Report and 
financial statements are fair, balanced and understandable 
while providing the necessary information to assess the 
Company’s position and performance, business model 
and strategy.

The Audit Committee further reviews and reports to the 
Board on the Group’s financial reporting, internal control 
and risk management systems and the independence and 
effectiveness of the external auditor.

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Annual Report 2020  Great Portland Estates 119

Audit, risks and internal controls continued

Audit Committee meetings

Audit Committee members and attendance 
in 2019/20

Chairman
Nick Hampton
Members
Charles Philipps
Wendy Becker1
Vicky Jarman2
Alison Rose

4/4

4/4
4/4
1/1
4/4

1.  Wendy Becker will step down from the Audit Committee on 9 June 

2020, following the signing of the Annual Report.

2.  Vicky Jarman became a member of the Audit Committee on 

1 February 2020 and was eligible to attend one meeting during 
the year.

Our approach
The key objectives for the Audit Committee are to review 
and report to the Board and shareholders on the Group’s 
financial reporting, internal control and risk management 
systems, and on the independence and effectiveness of 
the auditor.

Our process
The Audit Committee Terms of Reference are available on the 
Company website at www.gpe.co.uk/about-us/governance. 

At the beginning of the year, the Committee comprised 
four independent Non-Executive Directors, namely Nick 
Hampton as Chairman, Charles Philipps, Wendy Becker 
and Alison Rose. Vicky Jarman became a member of 
the Committee upon her appointment to the Board on 
1 February 2020. Following Vicky’s appointment and a review 
of the Committee’s composition, it was agreed that Wendy 
Becker would step down from the Committee on 9 June 
2020, following the signing of the 2020 Annual Report and 
financial statements. 

The biographies of the Committee members are set out 
on pages 54 and 55. Charles Philipps, Nick Hampton, 
Alison Rose and Vicky Jarman have recent and relevant 
financial experience, which, combined with Alison Rose and 
Vicky Jarman’s property related experience ensures the 
Committee, as a whole, has competence relevant to the real 
estate sector.

The Audit Committee provides a forum for review of the 
Group’s financial external reporting, including its accounting 
policies. In respect of the Group’s half-year and year-end 
results, this includes discussions with the Group’s external 
valuer, CBRE, on the valuation process and conditions in 
London’s real estate markets and the Group’s external 
auditor, Deloitte LLP (Deloitte), on any accounting or audit 
matters. The Audit Committee also reviews the adequacy 
and effectiveness of the Group’s internal financial controls, 
internal control and risk management systems and internal 
audit function, and is responsible for the selection and review 
of the effectiveness of the internal and external auditors. 

The Chairman of the Board, Richard Mully, attends the 
meetings reviewing the half-year and year-end results and 
has a standing invitation to attend any other meetings as 
appropriate. The Chief Executive, Finance and Operations 
Director, Director of Financial Reporting and Investor 
Relations, Director of Corporate Finance, other members 
of senior management and representatives from the 
external auditor and internal auditor also attend meetings 
as appropriate. 

The Committee meets four times a year, with the meetings 
aligned with our financial reporting timetable.

120

Great Portland Estates  Annual Report 2020

The Committee has continued to play a crucial 
role in providing comfort to the Board on 
the integrity of the Group’s processes and 
procedures in relation to financial reporting, 
internal control and risk management.”

Nick Hampton
Chairman of the Audit Committee

Dear fellow shareholder
On behalf of the Audit Committee, I am pleased to present 
my report as Chairman of the Committee for the year ended 
31 March 2020. The Committee has continued to play a 
crucial role in providing comfort to the Board on the integrity 
of the Group’s processes and procedures in relation to 
financial reporting, internal control and risk management. 

The report is intended to provide insight into the 
Committee’s activities in the year and sets out how we have 
performed against our objectives outlined on page 120.

As outlined on pages 120 and 125, the Committee meets four 
times a year to:

 – plan the external audit;

 – agree the internal audit plan;

 – identify key accounting and areas of judgement as early 

as possible;

 – review reports from the external and internal auditors 

and valuer;

 – consider how risks and internal controls have operated 
in the preceding six months in respect of the half-year 
and year-end results;

 – monitor the integrity of the Group’s financial reporting and 
consider any significant judgements by management; and

 – review the independence and effectiveness of the 

external and internal auditors.

Accounting and key areas of judgement 

Significant matter

Action taken

Valuation of the portfolio, accounting 
considerations and key areas of judgement 
As expected of a listed property REIT, the most significant 
financial judgement is GPE’s property valuation which is 
central to the Group’s performance and net asset value, and 
is inherently subjective. A key responsibility of the Committee 
is, therefore, to satisfy ourselves that the valuation process 
in relation to the Group’s property portfolio has been carried 
out appropriately. Following the comprehensive process 
which is outlined in more detail below, as a Committee we 
are satisfied that the valuation process is sufficiently robust.

During the year, the Committee also considered a number 
of items that impacted on the presentation of the Group’s 
financial statements, including:

 – the amendment and extension of the Group’s £450 million 
revolving credit facility (RCF) to a new £450 million ESG-
linked RCF;

 – the methodology used to value our flexible space offering;

 – the introduction of IFRS 16 Leases and transitional 

arrangements; and

 – the new industry-wide EPRA net asset value measures 
which we are required to implement for the full-year 
ending 31 March 2021.

External audit process
In light of the COVID-19 pandemic, the Committee and 
I have held regular discussions with management and 
Deloitte to discuss the process, controls and deliverables 
for the year-end results and the Annual Report and financial 
statements and to ensure that the external audit process 
has been carried out effectively. Despite the impact of 
COVID-19, appropriate interaction between the Committee, 
management and Deloitte has been maintained throughout 
the process and the ability of all of GPE’s employees to work 
remotely has served to ensure minimal disruption to the 
external audit process.

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Valuation of the  
Group’s portfolio
The valuation of the Group’s 
property portfolio is a key 
determinant of the Group’s 
net asset value as well as 
indirectly impacting executive 
and employee remuneration. 
The valuation is conducted 
externally by independent 
valuers, however, the nature 
of the valuation process is 
inherently subjective due to 
the assumptions made on 
market comparable yields, 
estimated rental values, void 
periods and costs to complete. 

The Audit Committee, together with the Chairman of the Board, meet with the valuer, the 
Executive Directors and senior management involved in the valuation process along with the 
external auditor in November and May to discuss the valuation included within the half-year 
and year-end financial statements. This review includes the valuation process undertaken, 
changes in market conditions including the impact of the heightened economic and political 
uncertainty created by the UK’s exit from the EU, recent transactions in the market and how 
these have impacted upon GPE’s valuation, valuation movements on individual buildings 
and the valuer’s expectations in relation to future rental growth and yield movement. 
The Committee asks the valuer to highlight significant judgements or disagreements with 
management during the valuation process. Due to the impact of the COVID-19 pandemic, 
the 31 March 2020 valuation included a statement highlighting a material valuation 
uncertainty given the current levels of market disruption. This statement was included in all 
recent RICS property valuations and was not specific to GPE. 

The external auditor, Deloitte, using its real estate experts, separately meet the valuer and 
provide the Audit Committee with a summary of their work as part of their report on the  
half-year and year-end results.

As a result of these reviews, the Committee concluded that the valuation had been carried 
out appropriately and independently and was suitable for inclusion in the Group’s accounts.

Annual Report 2020  Great Portland Estates 121

Audit, risks and internal controls continued

Fair, balanced and understandable
The Board as a whole is responsible for determining whether 
the 2020 Annual Report and financial statements are fair, 
balanced and understandable. The Audit Committee’s 
role is covered on page 119.

Viability and going concern statements
The Committee considered the viability and going concern 
statements and their underlying assumptions, including 
management’s work on assessing the potential risks to the 
business including, in particular, planning for the impact 
of the COVID-19 pandemic and the appropriateness of 
the Company’s choice of a three-year viability assessment 
period. Following this review, the Committee was satisfied 
that management has conducted a robust assessment and 
recommended to the Board that it could approve and make 
the viability and going concern statements.

Internal controls and risk management
The Audit Committee’s role in supporting the Board’s 
oversight and review of the Group’s principal and emerging 
risks, internal controls and risk management processes 
is covered on pages 80 to 83 and page 118.

Internal audit
Our internal audit function provides independent assurance 
as to the adequacy and effectiveness of the Company’s 
internal controls and risk management systems. Our internal 
audit function is outsourced to PwC, who report on their 
findings to the Committee. 

In February 2020, the Committee considered PwC’s 
internal audit report on GPE’s third party management, 
including buildings and facilities management. The report 
concluded that the majority of the controls in place were 
operating effectively. The Committee also discussed the 
implementation of agreed actions arising from PwC’s 
previous internal audit findings in relation to cyber security, 
development procurement and GDPR and was satisfied 
with the progress made. Six-monthly reports on IT general 
controls and cyber governance are also presented to the 
Board by the Head of IT. 

The Committee reviewed and agreed with PwC the internal 
audit plan for 2020/21, having regard to the Company’s 
risk management framework. It was concluded that, for 
the financial year ahead, PwC should undertake an internal 
audit of:

 – health and safety management;

 – HR and payroll processes and controls; 

 – cyber security; and

 – flexible working space.

The Committee believes that the process for determining 
the internal audit plan is appropriate and effective with 
scope for the Committee to react to events, new information 
and situations which become known during the year and 
to include them as necessary. In light of the continuing 
COVID-19 crisis and its impact on the business, the internal 
audit plan for 2020/21 will continue to be reviewed and 
adapted, if appropriate, to meet the changing needs of 
the business. 

Our anti-bribery and corruption 
and whistleblowing policies
Each year as part of the year-end planning meeting, the 
Committee considers the Group’s Ethics and Whistleblowing 
policies, both of which address the Company’s policies 
on bribery, for reporting to the Board. The Board has a 
zero tolerance for bribery and corruption of any sort.

Annually, all employees are required to confirm their 
compliance with the Group’s anti-bribery and corruption 
policies as outlined on page 106 and any non-compliance 
is escalated to the Committee as appropriate. No matters 
were escalated to the Committee in the year.

The Company’s whistleblowing processes include a 
confidential hotline, operated by an independent third party, 
through which employees can anonymously raise matters of 
concern relating to suspected wrongdoings or dangers at 
work. Any matters reported are investigated by the Company 
Secretary or the Senior Independent Director. During the 
year, there were no whistleblowing incidents reported.

Auditor reappointment
Deloitte was appointed as external auditor to Great 
Portland Estates plc in 2003 and the lead audit partner, 
Jude Tacon, took responsibility for the audit in June 2018. 
Auditor effectiveness is reviewed every year. However, it is 
currently intended that a competitive tender process will be 
undertaken to coincide with Jude Tacon’s five-year tenure as 
audit partner in 2023.

Based on the Committee’s recommendation, the Board is 
proposing that Deloitte be reappointed at this year’s AGM.

Committee effectiveness
I believe that the quality of discussion and level of challenge 
by the Committee with management, the internal and 
external audit teams and the valuer, together with the 
timeliness and quality of papers received by the Committee, 
ensures the Committee is able to perform its role effectively. 
The formal review of the Committee’s effectiveness was 
covered as part of the Board evaluation process and I am 
pleased that the review confirmed that the Committee 
is working well. Further details on the process and its 
broader findings can be found on pages 115 to 116.

Nick Hampton
Chairman of the Audit Committee 
9 June 2020

122

Great Portland Estates  Annual Report 2020

The external audit and review of its effectiveness
The Audit Committee advises the Board on the appointment 
of the external auditor, negotiates and agrees their 
remuneration for audit and non-audit work, reviews their 
effectiveness, independence and objectivity and discusses 
the nature, scope and results of the audit with the external 
auditor. As part of the review of the effectiveness of the 
external audit, a formal evaluation incorporating views from 
the Committee and relevant members of management is 
considered by the Committee. Feedback from the review 
undertaken in September 2019 was provided to Deloitte 
as part of the annual planning meeting.

Areas covered by the review included:

 – the calibre of the external audit firm, Deloitte – 

including reputation, coverage and industry presence;

 – quality controls – including review processes, partner 
oversight, reports on Deloitte generally from the 
Audit Quality Review Team (AQRT) and regulators and 
use of specialists;

 – the audit team – covering quality of individuals, 

knowledge, resources, partner involvement, team 
rotation, the audit scope including planning and 
execution, scope adequacy and specialist areas;

 – audit fee – reasonableness and scope changes;

 – audit communications and effectiveness – planning, 
new developments and regulations, approach to 
critical accounting policies, issues and risks, quality 
of processes, timely resolution of issues, freedom of 
communication with the Audit Committee and feedback 
on management performance;

 – governance and independence – internal governance 
arrangements, lines of communication with the Audit 
Committee, integrity of the audit team, Audit Committee 
confidence in the audit team and transparency;

 – ethical standards – including conflicts of interest,  

non-audit work and partner rotation; and

 – potential impairment of independence by non-audit 

fee income. 

Overall, the Committee agreed that the audit process had 
been both effective and efficient and in particular noted that 
the transition to a new audit partner since 2018/19 had been 
very smooth.

The Committee also considered the effectiveness of the 
Group’s management during the external audit process in 
respect of the timely identification and resolution of areas 
of accounting judgement, with input from Deloitte and the 
Committee as appropriate, as well as the timely provision of 
the draft results to Deloitte and the Committee for review. 
In addition, feedback was sought from Deloitte on the 
conduct of members of the Finance team during the audit 
process which confirmed that there had been a good level of 
communication and interaction between the teams.

The Committee requested that Deloitte continue to 
provide feedback on how the Company was responding to 
governance requirements and, in February 2020, the Deloitte 
Governance Team provided an in-depth update on recent 
corporate governance developments and their impact on 
the Company.

Following a tender process, Deloitte has been the Group’s 
auditor since 2003. It is a requirement that the audit partner 
responsible for the Group and subsidiary audits is rotated 
every five years.

Under the Company’s interpretation of the transitional 
arrangements for mandatory audit rotation, the Company will 
be required to change external auditor for the financial year 
ended 31 March 2024 and plans to undertake a competitive 
tender process to coincide with Judith Tacon’s five-year 
tenure as audit partner in 2023. The Committee believes 
that the relationship with the external auditor is effective and 
remains satisfied with their independence and effectiveness. 
The Committee has, therefore, recommended to the Board 
that Deloitte be reappointed as auditor at the 2020 Annual 
General Meeting. There are no contractual obligations 
restricting the Company’s choice of external auditor. 
The Committee will continue to consider the need to tender 
the audit annually depending on the auditor’s performance, 
taking into account the best interests of shareholders.

The Company has complied during the year ended 
31 March 2020, and up to the date of this report, with 
the provisions of the Statutory Audit Services for Large 
Companies Market Investigation (Mandatory Use of 
Competitive Tender Processes and Audit Committee 
Responsibilities) Order 2014.

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Annual Report 2020  Great Portland Estates 123

Audit, risks and internal controls continued

Audit and non-audit fees

Audit fees
Non-audit fees including 
the interim review
Ratio of non-audit fees to audit fees
Audit fees of joint ventures (GPE share)

2020 
£000s

2019 
£000s

2018 
£000s

271

229

222

75

77

68
29% 33% 31%
28

35

38

In addition to ensuring compliance with the Group’s policy in 
respect of non-audit services, the Committee also receives 
confirmation from Deloitte that it remains independent and 
has maintained internal safeguards to ensure its objectivity.

Internal audit
An Internal Audit Charter approved by the Board governs 
the Internal Audit remit and provides the framework 
for the conduct of the Internal Audit function, which is 
outsourced to PwC. 

The Committee reviews and approves the internal audit 
plan annually for a rolling three-year period which is closely 
aligned to the review by management and the Committee 
of the Group’s risk management framework. In addition, 
the Committee Chairman meets with PwC separately to the 
Committee to discuss planned internal audit activities and 
the results of internal audit reviews. 

The Committee meets annually with PwC without 
management present to discuss the effectiveness of the 
Internal Audit function, and also to seek feedback from PwC 
on the conduct of members of the GPE team during the 
internal audit process. The last such meeting took place in 
February 2020 when it was confirmed that there had been 
a good level of communication and interaction between 
the teams. The external audit partner also meets separately 
with PwC at least annually.

As PwC is engaged by the Group to provide tax compliance 
advice and other advisory services, consideration is given 
as to any potential conflict with Internal Audit before PwC 
is appointed to any advisory role. The Audit Committee 
also specifically considers PwC’s independence when 
annually reviewing and approving the internal audit plan 
to ensure that there are no conflicts in PwC undertaking 
the proposed internal audit work. 

Non-audit services
The external auditor, Deloitte, is responsible for the 
annual statutory audit and also provide certain other 
services which the Audit Committee believe they are 
best placed to undertake due to their position as auditor. 
These arrangements are governed by the Group’s policy for 
provision of non-audit services by the external auditor which 
is available on the Company’s website at www.gpe.co.uk/
investors/governance.

The policy was updated in February 2020 in order to reflect 
the FRC’s Revised Ethical Standard that came into force 
on 15 March 2020.

The purpose of this policy is to ensure that auditor 
independence and objectivity are maintained and under 
the policy, prior approval is required by the Committee for 
any permitted non-statutory assignments over £50,000, 
or where such an assignment would take the cumulative 
total of non-audit fees paid to the external auditor over 
50% of that year’s audit fees. The appointment of Deloitte 
to undertake any non-audit services also requires the prior 
approval of the Finance and Operations Director and, 
importantly, he is required to consider whether it is in the 
interests of the Company that the services are provided 
by Deloitte, rather than another supplier. The policy also 
applies a fee cap on permitted non-audit services whereby 
such fees in any financial year must not exceed 70% of the 
average statutory audit fee for the prior three consecutive 
financial years.

During the year, activities undertaken by Deloitte 
for the Group outside of the main audit included:

 – the interim review;

 – reporting on the income cover in connection with the 

debenture trust deed compliance certificate; and

 – assurance of 2019/20 sustainability and energy 

consumption data.

In each case, Deloitte were considered the most appropriate 
service provider due to their position as auditor and given 
their detailed knowledge and understanding of our business 
and industry.

Payments made by the Group for audit and non-audit fees 
for the year are disclosed on page 169. The Group’s audit 
fees are presented to, discussed and approved by the Audit 
Committee at its February year-end planning meeting. 
In addition, audit and non-audit fees paid to Deloitte in 
respect of joint ventures totalled £69,900 (GPE share: £34,950) 
(2019: £69,700) and £nil (2019: £nil) respectively. The non-audit 
fees for the year ended 31 March 2020 as a percentage of the 
prior three-year average audit fees are 35%.

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Great Portland Estates  Annual Report 2020

What we did in relation to the financial year ended 31 March 2020

September

Annual planning meeting

Met with the external auditor, Deloitte, to review:

 – the results of the AQR’s 2018/19 Quality Inspection Report 

on Deloitte

 – the effectiveness and independence of the auditor – 

see pages 123 and 124

 – significant accounting and key areas of judgement – 

see page 121 

 – Deloitte’s 2019/20 Audit Plan

February

Internal audit

Met with the internal auditor, PwC, to:

 – review PwC’s internal audit report on:

 – GPE’s third-party management 

including buildings and facilities management

 – updates on previous internal audit findings including 
cyber security, development procurement and GDPR 

 – agree and approve 2020/21 internal audit plan

Year-end planning update

Met with Deloitte to consider/approve:

 – significant accounting and key areas of judgement

 – proposed changes in disclosure planned for 

the 2020 Annual Report

 – the 2019/20 audit plan update 

 – the 2019/20 audit fee – see page 124

Other matters

Corporate governance update received from the 
Company Secretary and Deloitte 

Review of GPE’s Ethics, Whistleblowing and Gifts 
and Hospitality policies – see page 122

Review of the Audit Committee Terms of Reference

Update of the Provision for Non-Audit Services policy

2019

2020

November

Review of half-year results

Met with CBRE to consider the September 2019 valuation

Met with Deloitte to consider:

 – Deloitte’s 2019 sustainability data assurance report

 – Deloitte’s independence

 – their review of the September 2019 valuation and the 

half-year results announcement

 –  significant accounting and key areas of judgement 

including going concern – see page 121

 –  Group tax matters with the Director of Corporate Finance

 –  the principal risks, monitoring of internal controls 

and risk management processes

 –  the half-year results announcement

 – Deloitte’s relationships with management with feedback 

provided without management being present

Other matters

Feedback received separately from management on the 
relationship with the Internal and External Audit teams 
and resourcing of Finance and External Audit teams

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May/June

Review of year-end results

Met with CBRE to consider the March 2020 valuation – 
see pages 70 and 71

Met with Deloitte to review:

 – Deloitte’s audit of the March 2020 valuation –  

see pages 70 and 71

 –  significant accounting and key areas of judgement 

including going concern and viability work – see page 121

 –  update on Group tax matters

 – update on GPE’s prompt payment code

 –  the principal and emerging risks, monitoring of internal 

controls and risk management processes – see pages 80 
to 93

 –  the preliminary results announcement and Annual Report

 –  the Committee’s effectiveness

 –  relationship between Deloitte and GPE management with 

feedback provided by Deloitte without management present

 –  reappointment of the auditor – see pages 122 and 123

Annual Report 2020  Great Portland Estates 125

Directors’ remuneration report

Remuneration Committee

Remuneration Committee members and attendance in 
2019/20

Chairman
Wendy Becker
Members
Richard Mully1 
Charles Philipps
Vicky Jarman2 
Alison Rose 

5/5

5/5
5/5
N/A
5/5

1.  Richard Mully stepped down as a member of the Committee on 

27 February 2020.

2.  Vicky Jarman became a member of the Committee on 1 February 2020, 
following which there were no further Committee meetings during 
the year.

Our approach
The key objectives of the Remuneration Committee are 
to ensure that the Executive Directors are appropriately 
incentivised and remuneration arrangements are fully 
aligned with the Company’s strategy to generate superior 
portfolio and shareholder returns.

As outlined on pages 18 and 19, we currently measure 
our absolute and relative performance using a small 
number of key performance indicators:

 – Relative Total Property Return (TPR) demonstrating 

our portfolio’s relative performance;

 – Relative Total Shareholder Return (TSR) reflecting relative 

shareholder value; and

 – Total Accounting Return (TAR) showing our 

absolute performance.

Over the medium term, we aim to outperform 
our benchmarks.

The Group’s Annual Bonus Plan for the Executive Directors 
and employees generally uses financial targets based 
on TAR and the capital growth element of TPR, together 
with a review of the attainment of strategic and personal 
objectives to achieve operational excellence. However, for 
2020/21 only, given the exceptional level of uncertainty in 
current real estate values during the COVID-19 crisis, the 
Annual Bonus Plan will use the inherently equally robust 
measure of relative TSR rather than TAR. 

From 2020, the Long-Term Incentive Plan (the LTIP) will 
use two of our key performance indicators to measure the 
Group’s performance, namely TSR (50%) and TAR (50%). 
Under the LTIP, the level of reward to Executive Directors 
and senior management depends on the performance of 
the Group over a three-year period. 

126

Great Portland Estates  Annual Report 2020

Our overarching remuneration policy principles 
The Executive Directors’ total pay is analysed by looking 
across each of the different elements of remuneration 
including salary, pension, the Annual Bonus Plan and 
long-term incentives to provide the Remuneration 
Committee with a view of total remuneration rather than 
just the competitiveness of the individual elements. It is 
important that the Group’s remuneration policy reinforces 
the Company’s purpose, culture and values providing 
effective incentives for exceptional Group and individual 
performance. As well as providing motivation to perform, 
remuneration plays an important retention role and needs 
to be appropriately competitive without being excessive. 

To achieve the aims of the Company’s remuneration 
policy, the Committee generally seeks to position fixed 
remuneration, including benefits and pension, around 
mid-market, taking into account the size and complexity 
of the business as compared with other peer companies in 
the sector, and, using a significant proportion of variable 
reward, offers the ability to increase total potential 
remuneration for superior performance through the Annual 
Bonus Plan and long-term incentives. 

Remuneration of employees and engagement
As well as being responsible for determining the 
remuneration of the Executive Directors, the Committee 
is also responsible for setting the remuneration of the 
Chairman, the members of the Executive Committee and 
the Company Secretary and reviews the broad operation 
of remuneration policy and practices for all employees.

As part of the Committee’s responsibility to review GPE’s 
wider employee remuneration policies and alignment 
of incentives and rewards with the Company’s culture, 
during the year the Committee reviewed the workforce 
pension rate and discussed GPE’s gender pay gap statistics 
alongside our Inclusion and Diversity strategy, related 
policies and performance against the National Equality 
Standard, which was achieved in April 2020.

GPE’s annual review process and how this links to 
employees’ remuneration is incorporated into our new 
joiner induction process. During 2018, to ensure employees 
understood how our remuneration policies for the 
Executive Directors align with wider Company pay policies, 
Toby Courtauld and Nick Sanderson, supported by Rachel 
Aylett, our Head of HR, held an interactive session with 
employees to discuss our remuneration policy, gender pay 
and diversity. The Chairman of the Committee is intending 
to invite all GPE employees to attend a further event to 
discuss remuneration and the 2020 remuneration policy 
revisions later this year, following the 2020 AGM.

In January 2020, a number of briefing sessions were 
arranged which enabled employees to find out more about 
GPE’s pension scheme and the Executive Directors and 
Company Secretary hosted a session with employees to 
discuss the work of GPE’s Board and Committees, including 
the Remuneration Committee.

Our process
The Committee’s Terms of Reference are available on the 
Company website at www.gpe.co.uk/about-us/governance.

At the beginning of the year, the Committee comprised 
four independent Non-Executive Directors, namely Wendy 
Becker as Chairman, Richard Mully, Charles Philipps and Alison 
Rose. Vicky Jarman became a member of the Committee 
on 1 February 2020. Following Vicky’s appointment and 
a review of the Committee’s composition, Richard Mully 
stepped down as a member of the Committee on 27 February 
2020. Non-Executive Directors who are not members of the 
Committee each have a standing invitation to attend meetings 
of the Committee as appropriate, save where their own 
remuneration is under consideration.

The Committee was advised during the year by FIT 
Remuneration Consultants LLP (FIT Rem) as independent 
remuneration consultants. FIT Rem, which was appointed by 
the Committee in August 2014, attends Committee meetings 
and provides advice on remuneration for the Executive 
Directors, analysis on all elements of the remuneration policy 
and regular market and best-practice updates. 

FIT Rem reports directly to the Committee and does not 
provide any other services to the Company.

At the request of the Committee, Toby Courtauld, 
the Chief Executive, attends Committee meetings 
where appropriate and provides input with regard to 
the achievement of personal objectives for the Finance 
and Operations Director and other senior executives. 
He also attends discussions on remuneration as 
considered appropriate by the Committee, including on 
new appointments and promotions and to provide his 
input on the development of the remuneration policy. 
Rachel Aylett, Head of HR, attends a number of Committee 
meetings where appropriate to present proposals 
regarding workforce remuneration and related policies 
and the alignment of remuneration across the organisation, 
as well as to voice the perspectives of employees 
on relevant matters. 

No director or employee is involved in discussions 
on their own pay.

Compliance with the 2018 UK Corporate Governance Code
Throughout the year, and in particular as part of the Directors’ remuneration policy review, the Committee has considered 
the provisions set out in paragraph 40 of the 2018 UK Corporate Governance Code. In the Committee’s view, the Company’s 
proposed remuneration policy and current practices address these factors as set out below:

Clarity – remuneration arrangements should be 
transparent and promote effective engagement 
with shareholders and the workforce

This year involved the triennial review of the Company’s remuneration policy and the proposed new 
policy is clearly disclosed in this report. The Committee proactively engaged with shareholders and their 
representative bodies as part of the policy renewal process (engaging with shareholders representing 
over 50% of the share register). It is also regularly updated on developments in market practice and 
received reports on pay and conditions across the business. The Chairman of the Committee is 
intending to invite all staff to attend a session to discuss remuneration and the 2020 policy revisions 
later this year, following the 2020 AGM

Simplicity – remuneration structures should 
avoid complexity and their rationale and 
operation should be easy to understand

The Company operates a simple pay model which is biased to variable pay but only permits significant 
payments where the Company outperforms on both an absolute and relative basis against clear KPIs. 
The Annual Bonus Plan also includes a variety of strategic and personal objectives, with at least 50% 
of these combined elements being objectively measurable

Risk – remuneration arrangements should ensure 
reputational and other risks from excessive rewards, 
and behavioural risks that can arise from target-
based incentive plans, are identified and mitigated

Predictability – the range of possible reward 
values to individual directors and any other limits 
or discretions should be identified and explained 
at the time of approving the policy

Proportionality – the link between individual 
awards, the delivery of strategy and the long-term 
performance of the Company should be clear. 
Outcomes should not reward poor performance

There is broad discretion to reduce variable pay if the Committee does not consider the formulaic 
outcome to be appropriate in the circumstances and all plans include the ability to operate malus 
and clawback where appropriate

The policy includes a scenario chart showing potential pay levels on various assumptions and all awards 
are subject to maximum grant levels as set out in the policy, together with the discretions set out under 
‘Risk’ above 

The outturn in respect of variable pay is clearly set out in this report on pages 131 to 140 with payment 
clearly linked to our strategic and financial priorities. As indicated under ‘Risk’, the outturn can be 
reduced by the Committee as appropriate

Alignment to culture – incentive schemes 
should drive behaviours consistent with 
company purpose, values and strategy

Equivalent plans apply to the wider workforce to engender a high-performance culture, albeit that the 
weighting on personal performance increases as the plans cascade through the workforce. All objectives 
are directly linked to the Company’s KPIs while a proportion of objectives must be values-led

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Directors’ remuneration report continued 

Our remuneration policy 
aligns management incentives 
with our strategy and focused  
business model.”

2020/21 implementation of our policy
As part of the policy review, we carefully considered 
the performance measures applying to the variable pay 
arrangements and consulted extensively with our largest 
shareholders and their representative bodies. 

 Wendy Becker
Chairman of the Remuneration Committee

Annual Bonus

Dear fellow shareholder
On behalf of the Committee, I am pleased to present the 
Directors’ remuneration report for the year ended 31 March 
2020. I am pleased to report that, at the 2019 AGM, our 
Directors’ remuneration report was approved with over 95% 
of votes in favour. 

Policy renewal
UK law requires a listed company to seek shareholder approval 
for the renewal of its Directors’ remuneration policy at least every 
three years. Our policy was last approved by shareholders in 
2017 and we will, therefore, be submitting an updated policy to 
shareholders at the 2020 AGM. The proposed policy has been 
subject to thorough consultation with our major shareholders 
and the main proxy voting advisors.

Over the last year, the Committee undertook a review of the 
policy to consider whether it remains the most appropriate 
means of incentivising and retaining the best available talent 
for the Company. As part of this review, we reviewed a range 
of alternative structures but concluded that the current 
approach is both simple and well aligned to our strategy 
and remains fit for purpose.

This approach has served the Company well over many 
years and, operating with a clear bias to variable pay linked 
to our KPIs with an appropriate mix of absolute and relative 
performance goals, it ensures that management can only 
achieve near maximum levels of reward for achievement 
of both significant outperformance of other real estate 
companies and real absolute returns for our shareholders.

On this basis, the proposed 2020 policy largely reflects a 
continuation of the 2017 policy although, consistent with 
developments in best practice more generally, we include: 

 – discretion for the Committee to override and reduce 
the formulaic outturn under its variable pay plans in 
suitable cases;

 – deferral of an element of the annual bonus;

 – introduction of post-cessation share ownership 

guidelines; and

 – alignment of pension rates for any new Executive Director 

appointment to the Board with the average workforce rate, 
and we have committed to align the rate for incumbent 
Executive Directors by the end of 2022.

The Annual Bonus Plan measures will be slightly changed for 
2020/21 as set out below. In particular:

 – the Committee has decided to align the weightings of 
the TAR and MSCI capital growth index components at 
35% each, with the remaining 30% split equally between 
personal and ESG/strategic measures, although for 
2020/21 only, the TAR element will be replaced with the 
inherently equally robust measure of relative TSR due to the 
exceptional level of uncertainty in current real estate values 
during the COVID-19 crisis;

 – we shall be modifying the way that the non-financial 

(strategic and personal) measures operate with a clear 
commitment that ESG factors will be included within 
the 15% of the annual bonus attributed to ESG/strategic 
measures; and

 – at least half of the opportunity in respect of the non-
financial measures will also be subject to objectively 
measurable performance goals. 

LTIP

The LTIP will be subject to two, rather than the current 
three, performance measures which reflects some concern 
regarding the robustness of using Total Property Return 
against IPD over a three-year period. Going forward, 
performance will, therefore, be assessed against the other 
existing two measures of relative TSR and absolute TAR, 
both of which are explained in the main body of this report.

Under the 2017 policy, unusually, the Committee pre-set the 
target ranges for the subsequent three cycles of annual bonus 
and LTIP awards. Given the volatility arising from the UK’s 
current economic challenges which include, amongst other 
things, Brexit and COVID-19, retaining such an approach 
is no longer considered appropriate. The Committee will, 
instead, adopt the market standard approach of setting the 
appropriate ranges on or about the start of the performance 
period (one year for the annual bonus and three years for the 
LTIP) having regard to business plans, external forecasts and 
such other factors as the Committee considers relevant at 
the time. The annual bonus ranges will be clearly reported 
retrospectively following the financial year end

If not for the COVID-19 crisis, we would have granted LTIP 
awards shortly after the 2020 AGM and would have sought 
to include details of the precise performance targets in this 
report. In the circumstances, the Committee considers it 
appropriate to consider the precise timing and level of grants, 
mindful of guidance to avoid windfall gains in volatile markets, 
within the agreed caps, following shareholder approval of the 
new remuneration policy at the 2020 AGM. The Committee 
will then set the target ranges and make appropriate market 
disclosures as part of the grant process.

128

Great Portland Estates  Annual Report 2020

Salaries

For the year commencing 1 April 2020, the average like-for-like 
salary increase will be 4.7% with all employees receiving the 
minimum increase of 2%. The Committee propose to increase 
Toby Courtauld and Nick Sanderson’s salaries by 2% in line 
with that minimum level but, in view of the COVID-19 crisis, 
this increase has been deferred and is expected to take effect 
from 1 July 2020, subject to the Committee being satisfied 
that lockdown restrictions have been sufficiently lifted.

We trust that shareholders will agree that, with the proposed 
improvements, the remuneration policy remains appropriate 
and that shareholders will support the relevant resolutions at 
the 2020 AGM. 

I would also like to thank our major shareholders and proxy 
voting advisors for their time in helping the Committee to 
develop the proposed policy. 

Remuneration in respect of the year ended 
31 March 2020
Against the backdrop of a year dominated by UK political and 
economic uncertainty, we have again delivered on our long-
term strategy with excellent progress across our business, 
combining many operational successes with strong leasing 
activity and ongoing capital discipline, including successful 
completion of our £200 million share buyback programme. 

We have also continued to innovate, as we create space for 
London to thrive, and embrace change to meet the evolving 
aspirations of our occupiers, people, communities and 
other stakeholders. During the year, we further broadened 
our flex product and service offer, installed market-leading 
technology solutions across our portfolio including our new 
app ‘sesame’, issued the first ESG-linked bank facility by a UK 
REIT, committed to becoming a net zero carbon business by 
2030 and achieved the National Equality Standard following 
the launch of our Inclusion and Diversity strategy.

Moreover, we have maintained our market-leading debt 
metrics with our loan-to-property value ratio being only 
14.2% and our liquidity position strong with £411 million of 
available cash and undrawn facilities. As a result, despite the 
onset of COVID-19 towards the end of our financial year, the 
full extent of whose humanitarian, societal and economic 
impacts are still too early to judge, we have been able to 
maintain payment of our ordinary dividends and, when 
combined with net asset value (NAV) per share growth, we 
delivered a TAR of 3.2% in the financial year ended 31 March 
2020. Whilst unprecedented share price declines across 
global equity markets in March meant our TSR for the year 
to 31 March 2020 was -7.2%, we outperformed the FTSE 350 
Real Estate index by 5.2 percentage points.

The unprecedented current situation means that the 
resilience of our business has never mattered more, 
underpinned by our financial strength, deep stakeholder 
relationships and our open culture. Our portfolio positioning 
is also good with 56% of the portfolio in our development 
programme, and a further 37% in buildings where we can add 
further value through active portfolio management. We are 
also continuing to work collaboratively with our occupiers, 

suppliers, partners and communities, whilst ensuring the 
ongoing wellbeing and development of our people in line 
with our values. Taken together, we remain well positioned 
to continue delivering both our purpose and long-term 
shareholder value. 

Annual Bonus

Under our 2019/20 Annual Bonus Plan, we delivered a 
TAR of 3.2% in the financial year ended 31 March 2020 as 
explained above and therefore the TAR threshold of 4% 
was not met, resulting in a zero payout for this measure. 
However, the Group’s portfolio capital growth outperformed 
our relevant MSCI central London capital growth index for 
the year to 31 March 2020 by 0.8%, resulting in a payout of 
33.34% under the Annual Bonus Capital Growth measure.

In determining overall outcomes under the Annual Bonus 
Plan, the Committee has also taken into account individual 
Executive Directors’ performance against their personal 
objectives set at the beginning of the year. As you will see on 
pages 136 and 137, the Executive Directors each performed 
strongly in the year in delivering against these objectives. 

However, having regard to broader circumstances and the 
COVID-19 crisis, the Committee, with Executive Director 
support, exercised its discretion to reduce the personal 
objective performance assessments of 90% for each of Toby 
Courtauld and Nick Sanderson to a lower outturn of 70% in 
each case, with an amount equal to the difference between 
these amounts being paid by GPE to the GPE COVID-19 
Community Fund. 

2017 LTIP awards

Over the last three years, the central London commercial 
property markets have lacked strong direction and have 
broadly tracked sideways, in part due to muted economic 
growth since the EU Referendum and continued geopolitical 
and market uncertainty. However, our development activities 
and capital discipline over this period, combining sales of in 
excess of £750 million at prices broadly in-line with book value 
and £616 million of surplus capital returned to shareholders 
whilst the shares were trading at a meaningful discount to 
net asset value, means that we delivered EPRA NAV per 
share growth over the three years to 31 March 2020 of 8.6%. 
When combined with ordinary dividend payments, we 
delivered three-year annualised positive TAR of 4.2% resulting 
in a 23% vesting of the TAR measure for the Group’s three-
year 2017 LTIP award. 

Given our strong relative share price performance compared 
with the FTSE 350 Real Estate index, we expect 83% vesting 
of the TSR measure under the 2017 LTIP award based on the 
information available as at 31 March 2020.

We underperformed against the TPR benchmark for the 
three-year period to 31 March 2020, given our higher than 
benchmark exposure to properties with short lease lengths, 
resulting in a nil vesting under the TPR measure. 

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Directors’ remuneration report continued

Key decisions in the context of COVID-19
The Committee has given careful consideration to 
remuneration in the context of the external COVID-19 
environment. GPE remains in a strong financial and liquidity 
position following robust operational performance for the 
year and is well placed to withstand the impacts from the 
current crisis and to look to the future with confidence. 

The Board has recommended a final dividend to shareholders 
in line with the prior year and we consider ourselves fortunate 
that no GPE employees have been furloughed as a result 
of the crisis and we have no current plans to access any UK 
Government COVID-19 funding. 

Nevertheless, the Committee’s decision making has been 
mindful of the current climate in a number of areas:

 – in determining and reducing the 2019/20 personal objective 
outcomes for Executive Directors under the Annual Bonus 
Plan, with an amount equal to the value of the reduction 
being paid by GPE to the GPE COVID-19 Community Fund;

 – in deferring the effective date of 2020/21 salary and 
fee increases for the Board until the Committee is 
satisfied that COVID-19 lockdown restrictions have 
been sufficiently lifted;

 – the Chairman and other Non-Executive Directors agreeing 

to waive 20% of their 2020/21 fees for a three-month 
period and the Chairman further agreeing to waive any fee 
increase in respect of 2020/21, with an amount equal to the 
waived amounts being contributed to the GPE COVID-19 
Community Fund; 

 – for 2020/21 only, the annual bonus will be subject to relative 

TSR over the financial year rather than the usual TAR 
measure. The Committee did not consider it possible to set 
a suitable TAR target scale given the current uncertainty of 
real estate values in the midst of the COVID-19 crisis and 
the potential for highly volatile valuations making such a 
scale likely to be binary with zero or full vesting; and

 – as explained on page 128, due to the crisis, the Committee 
has considered it appropriate to defer agreeing and then 
disclosing precise 2020 LTIP performance targets in this 
report, and will instead consider the precise timing, grant 
levels and performance target ranges for the 2020 LTIP 
awards (within the agreed caps) following the 2020 AGM, 
mindful of guidance to avoid windfall gains in volatile 
markets. Appropriate market disclosures will be made as 
part of the grant process.

I hope you find this report clear and informative and I 
look forward to receiving your support for the resolutions 
approving both this report, and the revised Directors’ 
remuneration policy, at the 2020 AGM.

Wendy Becker
Chairman of the Remuneration Committee 
9 June 2020 

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2019/20 Executive Directors’ remuneration – at a glance
Please find below a summary of our remuneration and performance outcomes for the year ended 31 March 2020. 

Single total remuneration figure £0001  
Toby Courtauld – Chief Executive

Nick Sanderson – Finance and Operations Director

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

0

3,470

1,813 52%

905

26%

752

22%

1,945

916

47%

277

14%

752

39%

905
4
168
733

0%
19%
81%

2019

2020 Actual

2020 Maximum

4,000

3,500

3,000

2,500

2,000

1,500

1,000

500

0

1,711

1%
18%
81%

619
4
114
501

2019

1,812.6

2,392

1,249 52%

623

26%

520

22%

918
1,312

601

46%

191

520

14%

40%

2020 Actual

2020 Maximum

  Salary, benefits and pension 

  Cash bonus 

  LTIP and SIP shares 

1.  These figures contain estimates, see pages 129, 134 and 138. The 2020 Actual figures include the estimated value of the 2017 LTIP awards expected to vest 
in July 2020, based on the information available as at 31 March 2020 and calculated using the average share price for the three months to 31 March 2020 of 
£8.51 per share. Following the impact of COVID-19, the share price as at 1 June 2020 was £6.69 at which price the estimated value of the 2017 LTIP would be 
£724,666 and £474,694 for Toby Courtauld and Nick Sanderson respectively. 

Value of shareholding vs. shareholding policy (% of salary)1 
Toby Courtauld – Chief Executive

Nick Sanderson – Finance and Operations Director

2,000

1,500

1,000

500

0

300%

Policy

1,526%

Actual

2,000

1,500

1,000

500

0

300%

Policy

409%

Actual

1.  The value of shareholding as at 31 March 2020 has been calculated based on the share price as at 31 March 2020 of £6.81. 

Total remuneration

Executive Directors

Toby Courtauld

Nick Sanderson

Total

Salary  
£000

603

415

1,018

Benefits  
£000

Annual bonus  
£000

28

22

50

277

191

468

LTIP1
£000

912

597

1,509

Pension  
£000

SIP2 

£000

121

83

204

4

4

8

Total  
£000

1,945

1,312

3,257

1.  These figures contain estimates. See pages 129, 134 and 138. The LTIP figures include the estimated value of the 2017 LTIP awards expected to vest in July 

2020, based on the information available as at 31 March 2020 and calculated using the average share price for the three months to 31 March 2020 of £8.51 per 
share. Following the impact of COVID-19, the share price as at 1 June 2020 was £6.69 at which price the estimated value of the 2017 LTIP would be £724,666 
and £474,694 for Toby Courtauld and Nick Sanderson respectively. 

2.   This column shows the value of the matching shares awarded under the Employee Share Incentive Plan (the SIP) and calculated at the share price on the date 

the shares were purchased. No performance measures are relevant as per HMRC guidance. 

 › See more details on pages 134 to 138

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Directors’ remuneration report continued

Annual Bonus Plan

Bonus Plan Performance measures

MSCI Capital Growth Index outperformance

TAR

Operational excellence

 › See more details on pages 129 and 130

Maximum %  
of salary

Threshold  
Target 

Actual

% of maximum  
achieved

% of salary 
achieved 

75%

45%

CGI: +0%

CGI: +0.8%

TAR: +4%

TAR: +3.2%

33.34%

0%

30% See pages 136  
and 137

See pages 136  
and 137

Toby Courtauld – 70%  
Nick Sanderson – 70% 

25%

0%

21% 
21%

2017 LTIP Awards – vesting in July 2020 (included in the year ended 31 March 2020 single figure)

LTIP measure

Target 

Actual

% of maximum achieved

TSR - three years to vesting in July 2020

Median to upper quartile

4%–10% p.a. 

Index to Index +1.5% p.a.

Index minus 0.88% p.a

Estimated as at  
31 March 2020
69th percentile

4.2% p.a.

 83%

23%

0%

TAR – three years to 31 March 2020

TPR – three years to 31 March 2020

 › See more details on pages 129, 130 and 138

Annual report on remuneration

Statement of implementation of remuneration policy for the year ending 31 March 2021

Executive Directors
The remuneration policy and its implementation for the forthcoming financial year is summarised below:

Salary

Toby Courtauld

Nick Sanderson 

Year ending 
31 March 2021 
£000

Year ended 
31 March 2020 
£000

615

423

603

415

%  
increase

2

2

Both Toby Courtauld and Nick Sanderson have received an increase in salary below the average awarded to employees. 
This increase reflected the minimum increase provided to employees across the Group of 2%. In view of the COVID-19 crisis, 
this increase has been deferred and is expected to take effect from 1 July 2020, subject to the Committee being satisfied that 
lockdown restrictions have been sufficiently lifted at that time. The table above does not reflect the pro-rated salaries and 
actual amounts paid will be disclosed in the Directors’ remuneration report for the year ending 31 March 2021. In reviewing the 
salaries of the Executive Directors, the Committee has also taken account of both the individuals’ and Company’s performance 
and the employment conditions and salary increases awarded to employees across the Group.

Benefits and pension
There has been no change in the benefits and pension provision for the Executive Directors:

Toby Courtauld

Nick Sanderson 

Pension contribution  
(% of salary)  
Year ending 31 March 2021

Pension contribution  
(% of salary)  
Year ended 31 March 2020

Benefits

20%

20%

20%

20%

Policy Level

Policy Level

Neither of the Executive Directors participate in the Group’s defined benefit final salary pension plan, which was closed to new 
entrants in 2002. The Executive Directors have agreed that their pension contribution rates will be reduced to the rate available 
to the majority of staff (subject to periodic review but currently 10% of salary) from the end of the 2022 calendar year.

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Bonus for the year ending 31 March 2021
The target and maximum annual bonus potentials will remain unchanged at 75% and 150% of salary respectively for the 
Executive Directors. Under the proposed new remuneration policy, it is anticipated that 40% of the annual bonus outcome will 
be deferred into shares for three years under the proposed new Deferred Share Bonus Plan (the DSBP). The table below sets 
out the performance measures and their respective weightings for the year ending 31 March 2021.

Performance measures1 Weighting Description

Capital Growth

Total Shareholder  
Return

ESG/strategic  
measures

35%

35%

15%

Growth of the Company’s property portfolio against MSCI’s relevant Capital Growth Index for the year to 31 March 2021 
with 16.67% of this element payable at Index and 100% for a pre-determined level of outperformance.

TSR versus the constituents of the FTSE 350 Real Estate Index (excluding agencies) in the financial year. In subsequent 
years, it is envisaged that this will revert to Total Accounting Return (being growth of EPRA NTA plus dividends paid 
against target range). 

This element will be dependent upon the achievement of objectively measurable targets, each of which have an equal 5% 
weighting, as follows:

(i) 

 Sustainability – 50% of this element will be payable on performance against all three of our ESG-linked RCF targets 
within pre-defined target ranges and 100% payable for outperformance of all three targets;

(ii)   Occupier satisfaction – 50% of this element will be payable on achievement of a pre-determined Net Promoter Score 

level and 100% for outperformance of this level by 2 points; and

(iii)   Employees – 50% of this element will be payable on achievement of an Employee Engagement Index score of 75% 

and 100% payable for a pre-determined level of outperformance.

Personal/team 
performance

15%

The approach to assessing the personal element of the bonus has been sharpened to focus on a smaller number of key 
objectives and behaviours. The assessed outturn, and details of their delivery against these objectives, will again be 
disclosed in next year’s report.

1.  The Committee is of the opinion that, given the commercial sensitivity around GPE’s business, disclosing precise targets for the Annual Bonus Plan in advance, 

other than to the extent disclosed above in the case of the ESG/strategic measures, would not be in the best interests of shareholders or the Company. Objectives, 
performance achieved and awards made will be published at the end of the performance periods so shareholders can fully assess the basis for any payouts.

LTIP awards for the year ending 2021
The maximum potential award for the 2020 LTIP is 300% of base salary. Practice has been to grant at this level each year. 
The awards will be subject to a 50:50 mix of relative (to a predetermined group of other real estate companies) TSR and 
absolute TAR measures. In respect of TAR, from the year ending 31 March 2021, the Group will adopt the new EPRA metric of EPRA 
NTA. For the year ended 31 March 2020, the Group’s EPRA NTA and EPRA NAV were the same, as explained in our KPIs on page 18.

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The Committee will determine the appropriate award level at the time of grant having regard to the then prevailing 
circumstances and will set, and ensure the disclosure, of the performance target ranges as explained on page 128. 

Following the vesting of the awards after the three-year performance period, the 2020 LTIP awards will be subject to a two-
year holding period, whereby participants will not be permitted to exercise any performance-vested awards until the fifth 
anniversary of grant. The holding period will generally continue to operate post-cessation of employment. 

Non-Executive Directors
The table below sets out the fee rates for the Non-Executive Directors for the year ending 31 March 2021. Following an external 
benchmarking exercise, the Chairman’s fee has been increased by 6.4%, which was considered appropriate given that he 
was appointed with a lower fee than the previous Chairman to permit the rate to increase to the appropriate level as he grew 
in experience. One further above-inflation increase may be considered suitable in future years to achieve the appropriate 
level. The base fees for the Non-Executive Directors have been increased by 2.7%, broadly in line with the base increase for 
employees. In view of COVID-19, the fee increases for the Chairman and other Non-Executive Directors have been deferred 
and are expected to take effect from 1 July 2020, subject to the Committee being satisfied that lockdown restrictions have 
been sufficiently lifted at that time. The Chairman has waived his entitlement to the amount of any increased fee for 2020/21 
and all Non-Executive Directors, including the Chairman, have waived 20% of all their fees for a three-month period commencing 
1 June 2020, with an amount equal to the waived amounts being contributed to the GPE COVID-19 Community Fund.

Non-Executive Directors’ annual fees for the year ending 31 March 2021

Richard Mully

Charles Philipps

Wendy Becker

Nick Hampton

Alison Rose

Vicky Jarman

Base
fee1
£

Senior Independent 
Director  
£

Audit 
Committee  
£

Remuneration 
Committee  
£

Nomination 
Committee  
£

235,000

56,500

56,500

56,500

56,500

56,500

–

10,000

–

–

–

–

–

5,000

9563

12,500

5,000

5,000

–

5,000

12,500

–

5,000

5,000

–

3,350

3,350

3,350

3,350

3,350

Total
fees2
£

235,000

79,850

73,306

72,350

69,850

69,850

1.  These figures do not reflect the pro-rated or waived fee increases for the period as described above and actual amounts paid will be disclosed in the 

Directors’ remuneration report for the year ending 31 March 2021. 

2.  This table discloses the annual fee rates for each Non-Executive Director without adjustment for the deferred fee increases or waivers described above. 

Actual fees paid in 2020/21 will be disclosed in the Directors’ remuneration report for the year ending 31 March 2021.

3.   Wendy Becker will be stepping down from the Audit Committee from 9 June 2020 and this figure represents her fees for the relevant period.

Fee levels for the Non-Executive Directors are assessed having regard to individual responsibility and fees paid to 
Non-Executive Directors in the wider FTSE 250.

Annual Report 2020  Great Portland Estates 133

Directors’ remuneration report continued

Annual report on remuneration
This section of the remuneration report contains details of how the Company’s remuneration policy for directors was 
implemented during the financial year ended 31 March 2020.

Audited 

Executive

Toby Courtauld

Nick Sanderson

Non-Executive

Salary/fees

Benefits

Pension1

SIP2

Fixed  
Total

Annual  
Bonus

LTIP

Variable  
Total

Total5,6

2020 
£000

2019 
£000

2020 
£000

2019 
£000

2020 
£000

2019 
£000

2020 
£000

2019 
£000

2020 
£000

2019 
£000

2020
 £000

2019 
£000

20203
 £000

20194
£000

2020 
£000

2019 
£000

2020 
£000

2019 
£000

603

415

588

400

28

22

27

21

121

83

118

80

Richard Mully7

220

Charles Philipps8

Wendy Becker

Nick Hampton9

Alison Rose

Vicky Jarman10

Martin Scicluna11

Jonathan Short12

78

76

71

68

11

–

–

92

70

71

66

60

–

205

17

4

–

–

2

–

–

–

–

2

–

–

–

–

–

2

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

Total

1,542 1,569

56

52

204

198

4

4

–

–

–

–

–

–

–

–

8

4

4

–

–

–

–

–

–

–

–

756

524

224

78

76

73

68

11

–

–

737

505

277

191

168

114

912

597

94

70

71

66

60

–

207

17

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

– 1,189

168 1,945

–

–

–

–

–

–

–

–

–

788

114 1,312

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

224

78

76

73

68

11

–

–

905

619

94

70

71

66

60

–

207

17

8 1,810 1,827

468

282 1,509

– 1,977

282 3,787 2,109

1.  Toby Courtauld and Nick Sanderson receive a pension allowance of 20% of their basic salary.
2.  The value of the matching shares awarded under the SIP and calculated using the share price on the date the shares were purchased.
3.   The estimated value of the 2017 LTIP awards expected to vest in July 2020, based on the information available as at 31 March 2020 and calculated at the 

average share price of £8.51 per share for the three months to 31 March 2020. The estimated value attributable to share price growth is £264,132 and £173,020 
for Toby Courtauld and Nick Sanderson respectively. This has been calculated using the difference between the share price at grant of £5.94 and the 
three-month average share price at 31 March 2020. Following the impact of COVID-19, the actual share price as at 1 June 2020 was £6.69 at which price the 
estimated value of the 2017 LTIP would be £724,666 and £474,694 for Toby Courtauld and Nick Sanderson respectively. 

4.   The numbers disclosed in the 2019 Annual Report were based on an estimated level of TSR performance. For Toby Courtauld and Nick Sanderson, 

the estimated TSR vesting level of their LTIP and SMP awards vesting in June 2019 was 0% and the actual vesting was 0%. 

5.  The single figure for the total remuneration due to the directors for the year ended 31 March. 
6.   The aggregate emoluments (being salary/fees, bonus, benefits and cash allowances in lieu of pension) of all directors for the year ended 31 March 2020 

was £2,270,000 (2019: £2,101,000). 

7.  Richard Mully was appointed Chairman of the Board on 1 February 2019. 
8.  Charles Philipps became a member of the Remuneration Committee on 1 May 2018.
9.  Nick Hampton stepped down from the Remuneration Committee on 1 May 2018. 
10. Vicky Jarman was appointed to the Board on 1 February 2020.
11. Martin Scicluna retired from the Board on 31 January 2019. 
12. Jonathan Short retired from the Board at the 2018 AGM. 

Executive Director remuneration from other roles
Executive Directors are able to accept external Board appointments with consent of the Board. Any fees received by an 
Executive Director for such an external appointment can be retained by an individual. Toby Courtauld is a Non-Executive 
Director of Liv-ex Limited, for which he received no remuneration during the year. He also received no remuneration for 
serving as a director of the New West End Company.

Taxable benefits
Benefits principally comprise life insurance, health insurance, private healthcare subscriptions, travel expenses and 
membership subscriptions. No individual benefit provided has a value which is significant enough to warrant separate 
disclosure. Executive Directors are not provided with a company car or a company car allowance.

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2020 bonus outcome 
The financial targets for the bonus for the year ended 31 March 2020, and the extent to which they were achieved, are set out in 
the table below. The Committee did not exercise their discretion in respect of any of the financial performance measures.

Maximum 
percentage  
of salary

75%

Key elements  
of strategy

Market 
competitiveness

45%

30%

Absolute 
performance

Operational 
excellence

Measured by

Growth of the 
Group’s property 
portfolio against 
MSCI’s relevant 
Capital Growth 
Index (for the year 
to 31 March 2020) – 
on a stepped basis1

Achievement of TAR 
targets (for the year 
to 31 March 2020) 
– on a straight-
line basis

Achievement 
against personal 
objectives  
(for the year to 
31 March 2020)

1. MSCI Capital Growth Index

% payable

CGI < 0%

CGI + 0% to 0.49%

CGI + 0.5% to 0.99%

CGI + 1% to 1.49%

CGI + 1.5% to 1.99%

CGI + 2% to 2.49%

CGI + 2.5% and above

0%

16.67%

33.34%

50%

66.67%

83.34%

100%

Maximum 
performance  
target  
(100% payout)

Actual 
performance 
achieved

Actual 
performance level 
as a percentage 
of maximum

Bonus receivable (£000)

Toby 
Courtauld

Nick 
Sanderson

CGI: +0.8% 33.34%

151

104

Annual  
percentage 
rate of portfolio 
capital growth 
to exceed annual 
percentage 
rate of capital 
growth of the 
central London 
MSCI index by 2.5%

TAR: +10%

TAR: +3.2% 0%

–

–

Threshold 
performance  
target

Annual  
percentage 
rate of portfolio 
capital growth 
to meet annual 
percentage  
rate of capital 
growth of the 
central London 
MSCI index1

TAR: +4% 
(at which point 
20% is payable) 

Partial  
achievement 
of personal 
objectives

Exceeding  
personal  
objectives

See pages 
136 and 137

Toby Courtauld 
70%
Nick Sanderson 
70% 

126

87

Total

277

191

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Directors’ remuneration report continued

The Executive Directors’ personal objectives, approved by the Committee, are designed to focus on the delivery of the strategic 
priorities and the successful management of risk for both 2019/20 and the longer term. Following consideration of achievement 
against the Executive Directors’ personal objectives set at the beginning of the year as listed below, the Committee awarded 
Toby Courtauld and Nick Sanderson 90% of the full potential bonus for Operational Excellence. However, the reported figure 
reflects the decision taken by the Committee with Executive Director support, having regard to broader circumstances 
surrounding the COVID-19 crisis, to reduce the assessed performance achieved of 90% to a lower outturn of 70% (being the 
lowest outturn in recent years) with an amount equal to the difference between these amounts being paid by GPE to the GPE 
COVID-19 Community Fund. 

Significant personal objectives for each of the Executive Directors included: 

Toby Courtauld

Weighting Percentage award Objective

Achievement

Strategy

33.3%

30.8%

Creation and 
implementation 
of corporate strategy. 

Led and delivered annual strategy review process, considering numerous strategic 
options, both variations of status quo and more radical, setting out a plan to operate 
in the relatively flat conditions throughout the year, including:
 – reviewing all corporate options, leading to amongst other outputs, a further 

return to shareholders of surplus equity, in line with our disciplined approach to 
capital management;

 – restructuring to create an Occupier Services team to deliver enhanced occupier 
support and service. Led to further improvement in our Net Promoter Score 
relative to our peer group;

 – grew flex space offer to c.11% of office portfolio, tapping into a rich seam of 

demand;

 – renewed personal time commitment to GPE’s sustainability agenda, including our 
journey to becoming net zero carbon and culminating in the launch of the Group’s 
sustainability Statement of Intent; and

 – invested in innovation including through the creation and roll-out of a portfolio-
wide app, ‘sesame’, and through a new investment in a proptech fund exploring 
new technology in real estate.

Resultant leverage still at or near lowest level across UK REIT universe giving us both 
defensive characteristics against the COVID-19 downturn and capacity to invest.
Resultant development pipeline is at or near highest percentage across UK REIT 
universe with flexible timing. Winner of Developer of the Year, Property Week Awards.
GPE strategy and balance sheet positioned to take advantage of multiple economic 
outcomes.

Exemplary communication 
of strategy to all 
stakeholders and lead 
GPE’s IR programme.

Led and delivered wide-ranging IR and communication strategy. 
Voted No.1 Real Estate company, IR Magazine Awards.
Voted No.2 Best Investor Relations Team in European Real Estate in Institutional 
Investor awards. Top 3 ranking for Best European Real Estate CEO at same awards 
for eighth consecutive year.

Portfolio  
positioning

33.3%

30.8%

Creation and 
implementation of 
property strategy 
and business plan.

Portfolio positioned to take advantage of multiple market outcomes. 
Seven-year net sales campaign totalling £2.56 billion largely concluded with 
£64.5 million sold, 11% ahead of book value, during the year.
Three committed development projects pre-letting well with deals agreed during 
the year on much of the remaining space, ahead of ERV.
Strong portfolio management including £14.4 million of new rent from lettings 
with market deals 8.8% ahead of ERV and vacancy at a near all-time low of 2%. 
Generated ERV growth over the year towards top end of forecast.
New flex office product, covering 219,600 sq ft, operating successfully pre-COVID-19 
outbreak. Well positioned to take advantage of demand for flexibility post-
COVID-19. 
Maintained disciplined approach to acquisitions, preferring to invest internally for 
better risk adjusted returns. Well positioned to buy should opportunities emerge 
as a result of COVID-19 impact.

Lead and progress 
innovation and 
sustainability agendas.

Portfolio-wide app launched. Proptech investment made. Research projects 
progressed through membership of European Think Tank. Sustainability agenda 
elevated to the centre of strategy. Committed to become net zero carbon business 
by 2030. Statement of Intent launched.

Team, culture  
and behaviour

33.4%

28.4%

Ensure and foster 
a positive, creative 
culture built around 
a strong team ethic.

Assessed  
reduction

Final overall  
assessment

20%

70%

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Great Portland Estates  Annual Report 2020

Strong leadership embedding our corporate purpose and values resulting in 
exceptional employee engagement: 94% of GPE people think “GPE is a great place to 
work”. Second Community Day and new Community Fund both successfully delivered. 
Mentoring programming broadened. Rotating seats at Executive Committee 
successfully implemented. Next phase of GPE Wellbeing programme launched.
Inclusion and Diversity strategy launched. National Equality Standard accreditation 
achieved.

The assessed performance achieved was 90% for the personal objectives. However, 
having regard to the broader circumstances surrounding the COVID-19 crisis, the 
Committee and Toby Courtauld agreed that the assessment should be reduced 
by 20% of the maximum resulting in an agreed outturn of 70% with an amount 
equal to the difference between these amounts being paid to the GPE COVID-19 
Community Fund.

Nick Sanderson

Weighting Percentage award Objective

Achievement

Strategy

33.3%

30.0%

Assist in setting 
and delivery 
of corporate strategy.

Led Board debate and successfully completed £200 million share buyback, 
whilst maintaining lowest financial leverage (LTV of 14%) in UK REIT universe.
Investment in Pi Labs proptech VC fund.

Maintain low cost, 
flexible and conservative 
debt structure.

Transparent and 
proactive communication 
of strategy to shareholders 
and other stakeholders.

Maintain focus on 
efficient operations 
and risk management 
to support strategy.

Portfolio  
positioning

33.3%

30.0%

Driving sustainability 
initiatives across all 
aspects of GPE.

Innovative £450 million ESG-linked corporate revolving credit facility issued, the 
first by a UK REIT and lowest coupon in sector.
One of lowest cost and most flexible debt books in REIT sector with weighted 
average interest rate of 2.2% and 92% on unsecured basis, following redemption 
of GRP bank loan.

Voted No.1 Real Estate company, IR Magazine Awards, No.2 Investor Relations 
team and No.2 CFO in European real estate (small/midcap) in Institutional Investor 
awards. Shortlisted Best Overall Company in IR Society Best Practice Awards. Led 
IR programme, including Investor and Analyst event.
GPE shortlisted for best Annual Report in FTSE 250 in ICSA awards.
Maintained programme of meeting GPE’s top occupiers.

Led GPE COVID-19 response team and formed GPE@Home team.
Continued robust occupier credit underwriting to ensure minimal delinquencies 
(<1.5% of rent roll in the financial year).
Inaugural IT strategy launched, with enhanced cyber risk measures and portfolio 
wide support.
New Health and Safety strategy launched and rolled out across business.
Further tightening of corporate structure through subsidiary strike-offs.

Sustainability Statement of Intent launched (including commitment to be net zero 
carbon business by 2030) following participation in Climate Change Commitment 
with BPP. Sustainability education programme for employees commenced. 
New Community Fund launched and second Community Day held.
Continued success in sustainability and ESG reporting, including GRESB 5 stars 
for fourth consecutive year. 

Joint ventures  
management.

Excellent relationships maintained with all JV partners and good progress made 
in delivering business plan, including lettings in GRP and pre-lettings in GHS.

Team, culture  
and behaviour 

33.4%

30.0%

Wider development of 
GPE team and culture.

Continue to develop 
and motivate finance 
and other central 
function teams.

Assessed  
reduction

Final overall  
assessment

20%

70%

Strong engagement survey results (96% participation rate, 94% recommend GPE 
as great place to work) showing 91% of employees can explain our values and 
believe they are right for GPE. Values now embedded in performance process.
Inclusion and Diversity strategy launched and National Equality Standard achieved, 
supported by introduction of rotating seats on Executive Committee and 
recruitment training.
Phase 3 of GPE wellbeing programme and enhanced flexible working policy 
delivered. 

Successful restructuring and enhanced resourcing for HR, Financial Analysis and 
Management Information and Health and Safety teams.
Recruitment of new Head of Health and Safety.

The assessed performance achieved was 90% for the personal objectives. 
However, having regard to the broader circumstances surrounding the COVID-19 
crisis, the Committee and Nick Sanderson agreed that the assessment should 
be reduced by 20% of the maximum resulting in an agreed outturn of 70% 
with an amount equal to the difference between these amounts being paid to 
the GPE COVID-19 Community Fund.

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Directors’ remuneration report continued

Anticipated vesting of 2017 LTIP awards
The tables below set out the alignment of LTIP awards with Company strategy and the anticipated vesting for those awards in 
July 2020, together with indicative payouts for the Executive Directors. The anticipated value of these awards at vesting reflects 
the disclosure in the single figure table on page 134.

Anticipated vesting of LTIP awards granted in the year ended 31 March 2018 – vesting in the year ending 31 March 2021 is 
included in the 2020 single figure.

Key elements 
of strategy

Shareholder 
value

Absolute 
performance

Portfolio  
performance

% of award

33.33%

33.33%

Measured by

Total Shareholder Return 
(based on a three-year 
performance period)

Total Accounting Return 
(based on a three-year 
performance period)

33.33% Total Property Return against 
IPD (central London index) 
(based on a three-year 
performance period)

Threshold 
performance 
target (20%)

Maximum 
performance  
target (100%)

Estimated 
performance

Median

Upper quartile

69th percentile

4% p.a.

10% p.a.

4.2% p.a.

Index

Index + 1.5% p.a.

Index minus 
0.88% p.a.

Estimated 
vesting level as at 
31 March 2020 
as a percentage 
of maximum 
by vesting date1

83%

23%

0%

1.   Toby Courtauld and Nick Sanderson’s 2017 LTIP awards are due to vest on 7 July 2020. For the TAR and TPR targets, the performance period for the 2017 
awards is the three-year period to 31 March 2020. For the TSR element, the vesting period is the three-year period from the award date and compares the 
Company’s TSR to that of the constituents, at the date of grant, of the FTSE 350 Real Estate Index excluding agencies.

Actual vesting of LTIP and SMP awards granted in year ended 31 March 2017 – vested in the year ended 
31 March 2020 and included in the 2019 single figure1 

Key elements 
of strategy

Shareholder 
value

Absolute 
performance

Portfolio  
performance

Variable 
component

Maximum 
percentage 
of salary

LTIP

SMP

LTIP

SMP

LTIP

SMP

66.66%

33.33%

66.66%

33.33% 

66.66%

33.33% 

Measured by

Total shareholder return 
(based on a three-year 
performance period)

Growth in the Group’s  
net assets per share  
(based on a three-year 
performance period)

Total property return  
(based on a three-year 
performance period)

Threshold 
performance 
target (20%)

Median

RPI plus  
3% p.a.

Median

Maximum 
performance  
target (100%)

Upper 
quartile

The Group’s 
growth in net 
assets to exceed 
RPI plus 9% p.a.

Actual 
performance

33rd percentile

RPI plus 2.8% p.a.

Upper 
quartile

11th 
percentile

Actual vesting level 
as at 31 March 2019 
as a percentage of 
maximum by
vesting date1

0%

0%

0%

1.   The numbers disclosed in the 2019 Annual Report were based on an estimated level of TSR performance. For Toby Courtauld and Nick Sanderson the 

estimated TSR vesting level of their LTIP and SMP awards vesting in June 2019 was 0% and the actual vesting was 0%. 

The value of actual LTIP and SMP awards vesting versus estimated numbers included in the 2019 Annual Report are as follows:

Toby Courtauld

Nick Sanderson

The aggregate gain to all directors from share awards that vested during the year to 31 March 2020 was £nil.

2019  
Actual  
£000

2019 
Estimated 
£000

–

–

–

–

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Great Portland Estates  Annual Report 2020

Unvested share awards
The following tables provide details of outstanding share awards under the LTIP and the performance measures that apply to 
the awards.

Executive Director

Toby Courtauld

Nick Sanderson

Date of grant Basis of award

7 July 2017 300% of salary

4 June 2018 300% of salary

3 June 2019 300% of salary

7 July 2017 300% of salary

4 June 2018 300% of salary

3 June 2019 300% of salary

Face value of 
award made 
£000

Number of
awards1,2

Percentage 
of award 
receivable 
for threshold 
performance

1,722

1,765

1,809

1,128

1,200

1,245 

290,109

254,848

252,072

190,037

173,225

173,427

20%

20%

20%

20%

20%

20%

End of 
performance 
period

6 July 2020

3 June 2021

2 June 2022

6 July 2020

3 June 2021

2 June 2022

Performance  
measures

Total Shareholder 
Return – 33.33%

Total Property 
Return – 33.33%

TAR Target – 33.33% 

1.  For the 2017, 2018 and 2019 LTIP award, the face value is calculated on the five-day average share price prior to the date of grant of the LTIP award. For the 

2017 LTIP this was up to and including 6 July 2017, being £5.94. For the 2018 LTIP, this was up to and including 1 June 2018, being £6.93. For the 2019 LTIP, this 
was up to and including 31 May 2019, being £7.18. 

2.  When verifying the satisfaction of the performance targets, it became apparent that a grant price for the 2017 LTIP grant of £5.84 had been used when the 
correct price was £5.94. Accordingly, the shares regarded as granted in 2017 have been marginally reduced to reflect the intended level. The number of 
awards in the above table is, therefore, slightly lower than reported in previous reports. All vestings in this report have been calculated using this reduced 
grant number.

Performance measure over three years

% of award

Vesting level

Start of  
measurement period

20%

Straight-line vesting  
between these points

 100%

TAR 

TSR against constituents of FTSE 350 Real Estate Sector 
(excluding agencies)

Total Property Return against IPD 
Total Property Return – central London index

33%

33%

33%

4% p.a.

Median

Index

Payments to past directors
No payments to past directors were made during the year.

Payments for loss of office
No payments were made to directors during the year for loss of office.

10% p.a.

Upper  
quartile

Index +  
1.5% p.a.

1 April prior to grant

Grant date

1 April prior to grant

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Statement of Executive Directors’ shareholding and share interests
Directors’ share interests and, where applicable, achievement of shareholding requirements is set out below:

Shareholding

Shares 
subject to 
performance 
conditions

Shares 
required to 
be held
(% salary)

Number 
of shares 
required to 
hold1

Number of 
beneficially 
owned
shares 2,3

Shareholding 
requirement
met4

Total
interests 
(excluding 
LTIP)
held at
31 March
2020

Total
interests 
(excluding 
LTIP)
held at
31 March
2019

SIP
Matching
shares
subject to 
forfeiture

Total
interests
held at
31 March
2020

LTIP5

300%

300%

265,645

182,766

1,351,387

Yes – 1,526%

1,430

1,352,817

1,352,175

626,135

1,978,952

249,173

Yes – 409%

1,432

250,605

249,960

424,744

675,349

Director

Toby Courtauld

Nick Sanderson

1.  For Toby Courtauld and Nick Sanderson, the holdings are calculated based on the share price as at 31 March 2020 of £6.81.
2.  Beneficial interests include shares held directly or indirectly by connected persons.
3.   Between 1 April 2020 and 8 June 2020, Toby Courtauld and Nick Sanderson acquired 68 and 67 Partnership shares and 136 and 134 conditional Matching 

shares respectively under the SIP. In addition, under the SIP, 77 Matching shares vested to each of Toby Courtauld and Nick Sanderson, otherwise there were 
no changes in their shareholdings.

4.   Executive Directors are expected to retain the after-tax shares received on the vesting of awards, until they have acquired the necessary shares to meet their 

shareholding requirement.

5.    Figures include 22,512 shares and 14,746 shares for Toby Courtauld and Nick Sanderson respectively which are no longer subject to performance conditions.

Annual Report 2020  Great Portland Estates 139

Directors’ remuneration report continued

Non-Executive Directors’ shareholding

Richard Mully

Charles Philipps

Wendy Becker

Nick Hampton

Alison Rose

Vicky Jarman

31 March 2020

31 March 2019

26,379

4,094

8,277

2,500

–

2,708

16,379

4,094

8,277

2,500

–

–

There were no changes in the shareholdings of the Non-Executive Directors in office as at 31 March 2020 between 1 April 2020 
and 8 June 2020.

Non-Executive Directors’ annual fees for the year ended 31 March 2020

Richard Mully

Charles Philipps

Wendy Becker

Nick Hampton

Alison Rose

Vicky Jarman1

Base  
fee  
£

Senior Independent 
Director  
£

Audit  
Committee  
£

Remuneration 
Committee  
£

Nomination 
Committee  
£

220,000

55,000

55,000

55,000

55,000

9,167

–

10,000

–

–

–

–

–

5,000

5,000

12,500

5,000

833

–

5,000

12,500

–

5,000

833

–

3,350

3,350

3,350

3,350

558

Total  
fees  
£

220,000

78,350

75,850

70,850

68,350

11,391

1.  Vicky Jarman was appointed to the Board on 1 February 2020.

Unaudited

Ten-year Chief Executive remuneration package
The table below shows the Chief Executive’s remuneration package over the past ten years, together with incentive payout/ 
vesting as compared to the maximum opportunity.

Single figure of total remuneration (£000)

Bonus payout as % of maximum opportunity

Long-term incentive vesting rates  
(as % of maximum opportunity)

2011 

2,087

100%

2012

2,910

70%

20131

4,924

92%

2014

3,409

100%

2015

3,689

48%

2016

2,650

100%

2017

1,402

20%

2018

1,174

37%

2019

905

19%

2020

1,945

31%

50%

100%

95%

86%

81%

58%

33%

10%

0%

35%

1.   Includes a one-off SMP award made in 2010 of 100% of salary.

Performance graph
The following graph shows the total shareholder returns for the Company for each of the last ten financial years compared to 
the FTSE 350 Real Estate index (excluding agencies). The Company is a constituent of the FTSE 350 Real Estate index and the 
Committee considers this benchmark to be the most appropriate for illustrating the Company’s performance.

Total shareholder return over ten years (indexed)

300

280

260

240

220

200

180

160

140

120

100

80

31 March
2010

31 March
2011

31 March
2012

31 March
2013

31 March
2014

31 March
2015

31 March
2016

31 March
2017

31 March
2018

31 March
2019

31 March
2020

Great Portland Estates

FTSE 350 Real Estate Index

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Employee Share Trust
Upon the vesting of share awards, shares used to satisfy awards under the LTIP are transferred out of the Great Portland Estates 
plc LTIP Employee Share Trust (the Trust), a discretionary trust established to facilitate the operation of the Company’s share 
plans. The shares to satisfy vested awards have been purchased by the Trustees of the Trust in the open market. The number of 
shares held by the Trust as at 31 March 2020 was 1,109,303.

Dilution
The Company currently funds the Trustees to purchase all of the shares required to satisfy awards under the Company’s share 
plans and no shares have been issued to satisfy any grants made in the last ten years. However, if the Company decided 
to issue new shares to meet these awards, the Company would operate all of its share incentive arrangements within The 
Investment Association (IA) Guidelines on dilution. The following table sets out the level of dilution against the IA limits for all 
share plans and discretionary plans in respect of the outstanding awards should the Company issue shares rather than use 
purchased shares held in Trust.

Maximum

10% dilution in ten years (all plans)

5% dilution in ten years (discretionary plans)

As at 31 March 20201

1.47%

1.44%

1.  This figure shows the number of shares required to satisfy all outstanding awards as at 31 March 2020 as a percentage of the Company’s issued share capital 

were these to be satisfied by the issue of new shares. This does not include vested awards that have been satisfied using market purchased shares.

Percentage change in Chief Executive’s remuneration
The table below compares the percentage increase in the Chief Executive’s pay (including salary, taxable benefits and annual 
bonus) with the increase for the wider employee population. The Company considers all employees to be an appropriate 
comparator group. 

Chief Executive  
(£000)

Total employee pay  
(£000)

Average number  
of employees

Average employee pay  
(£000)

2020

2019 % change1

2020

2019 % change1

2020

2019 % change

2020

2019 % change

Base salary

Taxable benefits

Bonus

Total

603

28

277

908

588

27

168

783

2.5

3.7

64.8

16.0

10,065

513

3,252

9,515

507

2,418

13,830

12,440

5.7

1.2

34.5

11.2

110

110

110

110

104

104

104

104

5.8

5.8

5.8

5.8

92

5

30

127

91

5

23

119

1.1

–

30.4

6.7

1.  The difference in % change in the Chief Executive’s bonus compared to employees is due to employees below the Executive Committee having a smaller 
proportion of their bonus based on corporate performance measures. The bonus split for the Chief Executive, Finance and Operations Director and 
Executive Committee members is 50/30/20 TPR/TAR/personal objectives. The employee bonus split (excluding the Executive Directors and Executive 
Committee members) applies a higher weighting to personal objectives. 

Chief Executive pay ratio
Although the Company has less than 250 employees and is not, therefore, subject to any legal requirement to include 
such ratios, the Committee considers inclusion of the ratio to be reflective of best practice and includes this on a voluntary 
basis. The Committee notes the general preference of institutional shareholders for companies to use statutory Method 
A and prepared the calculations on that basis. However, for a company with a relatively small number of employees (116 
as at 31 March 2020), the ratios can be unduly impacted by joiners and leavers who may not participate in the full suite of 
remuneration arrangements in the year of joining or leaving. Accordingly, the Committee modified the statutory basis to 
exclude any employee not employed throughout the financial year. In all other respects, Method A was followed so the 
following tables refer to modified Method A being adopted.

The Company believes that a bias in senior executive pay to variable pay is the most appropriate means of both incentivising 
the Executives and aligning them with shareholders. The ratios will therefore fluctuate according to variable pay outcomes 
each year and have increased from the prior year when there was a nil LTIP vesting.

Ratio of the pay of the Chief Executive to that of the UK lower quartile, median and upper quartile employees

Year

31 March 2020

31 March 20191

Method

Modified Method A

Modified Method A

25th percentile

50th percentile (median)

75th percentile

29.3:1

14.2:1

22.1:1

9.3:1

9.6:1

5.7:1

1.  The 2019 ratios are unchanged from those stated in the 2019 Directors’ remuneration report as there was no change in the final LTIP (nil) vesting outcome.

Pay ratio

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Directors’ remuneration report continued

Additional information on the ratio of the pay of the Chief Executive to that of employees
 – Employee pay data is based on full time equivalent pay for UK employees as at 31 March 2020. For each employee, total 
pay is calculated in line with the single figure methodology (i.e. fixed pay accrued during the financial year and the value 
of performance-based incentive awards vesting in relation to the performance year).

 – Employee pay data excludes leavers, joiners and employee transfers in or out of the UK during the year, to help ensure data 
is on a like-for-like basis, and data for life assurance and long-term illness cover are based on the value of notional premia. 
No other calculation adjustments or assumptions have been made.

 – Chief Executive pay is as per the single total figure of remuneration for 2020, as disclosed on page 134.

 – The 2020 ratio will be re-stated in the 2021 Directors’ remuneration report to take account of the final LTIP vesting data 

for eligible employees and for the Chief Executive.

 – The Committee has considered the pay data for the three individuals identified for 2020 and believes that it fairly reflects 

pay at the relevant quartiles among the UK employee population. Each of the individuals identified was a full-time employee 
during the year and received remuneration in line with the Group remuneration policy.

Salary and total remuneration used to calculate the ratio of pay 
To provide further context, the table below shows the Chief Executive and the employee percentile pay used to determine the 
2020 pay ratios:

Total salary

Total remuneration (single figure)

603

1,945

50

66

63

88

123

203

Chief Executive
£000

25th percentile
£000

50th percentile (median)
£000

75th percentile
£000

Our LTIP is intended to link total remuneration to the achievement of the Group’s long-term strategy and to reinforce 
alignment between Executive remuneration and shareholder interests. Therefore, participation is typically senior employees 
who have line of sight to influence directly the performance targets on the awards. With a significant proportion of the pay of 
our Group Chief Executive linked to performance and share price over the longer term, it is expected that the ratio will depend 
materially on long-term incentive outcomes each year, and accordingly may fluctuate.

Relative importance of spend on pay
The table below sets out the relative importance of spend on pay in 2018, 2019 and 2020:

Relative importance of spend on pay £m

35

30

25

20

15

10

5

0

-3%

+2%

33.5

32.5

33.2

-6%

+20%

21.3

18.8

17.7

2018

2019

2020

2018

2019

2020

Overall spend on pay

Dividend

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Great Portland Estates  Annual Report 2020

Consideration by the directors of matters relating to directors’ remuneration 

Committee advisors
The Committee is satisfied that the advice received from FIT Rem is independent and objective as FIT Rem complies with 
the Code of Conduct for Remuneration Consultants (which can be found at www.remunerationconsultantsgroup.com) 
and provides no other advice to the Group. FIT Rem’s fees for the year to 31 March 2020 were £72,670 which is charged on its 
normal terms.

Independent and objective performance certificates are provided to the Committee by:

 – Deloitte on measurement of TAR performance targets for the LTIP awards. Fees paid to Deloitte in respect of this were 

£2,500. Deloitte are appointed by the Company as its auditor. Total fees paid to Deloitte are shown on page 169;

 – Aon Hewitt on measurement of TSR performance targets for the LTIP awards together with IFRS 2 calculations. Fees paid to 
Aon Hewitt in respect of this were £16,650. Aon Hewitt also provides benchmarking services to the Group and fees paid in 
relation to this total £4,000; and 

 – Morgan Stanley Capital International (MSCI) on measurement against its property benchmark, for the Executive and 
Employee Annual Bonus Plan and measurement of TPR performance targets for the LTIP awards as part of its MSCI 
membership. Fees paid in relation to this membership total £34,915.

Statement of voting at the AGM
The following table shows the results of:

 – the binding vote on the Directors’ remuneration policy commencing from the 6 July 2017 AGM; and

 – the advisory vote on the Directors’ remuneration report at the 4 July 2019 AGM. 

It is the Committee’s policy to consult with major shareholders prior to any major changes to its Executive remuneration.

2017 Directors’ remuneration policy

2019 Directors’ remuneration report

For

Against

Abstentions

259,839,425 (97.13%)

7,669,753 (2.87%)

205,038,325 (95.61%)

9,423,955 (4.39%)

1,808,378

1,616,009

The Committee believes that this strong level of support demonstrates that there are no shareholder concerns in respect 
of the Company’s current remuneration policy and its operation.

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Directors’ remuneration report continued

Directors’ remuneration policy
This section of the Directors’ remuneration report contains details of the Directors’ remuneration policy that will govern the 
Company’s future remuneration payments.

The policy below sets out the remuneration policy we intend to apply, subject to shareholder approval, from 24 July 2020, the 
date of the next AGM. Until such approval the current remuneration policy, which was approved by shareholders at the 2017 
AGM, will apply. It is the intention that the new policy will apply for a period of three years from approval. Any key changes 
in policy have been highlighted in the proposed new policy. The policy part of the remuneration report, if approved, will be 
displayed on the Company’s website, at www.gpe.co.uk/investors, immediately after the 2020 AGM. 

Executive Director remuneration

Purpose and link to strategy

Operation and process

Reviewed by the Committee at least annually and assessed having regard to 
Company performance, individual responsibilities, inflation, as well as salary 
levels in comparable organisations (particularly within the listed property sector) 
and taking account of salary policy and annual increases within the rest of 
the Group.

Fixed  
remuneration

Base salary
To provide a market 
competitive salary 
which takes into 
account individual 
responsibilities and 
attracts and retains 
talent in the labour 
market in which the 
Executive Director 
is employed.

Benefits
To provide cost-
effective benefits 
that are valued by 
the recipient and 
are appropriately 
competitive.

Benefits principally comprise life insurance, health insurance, private healthcare 
subscriptions, travel expenses and membership subscriptions. A company car 
or company car allowance may be provided although it is not the Company’s 
current practice to provide either to current Executive Directors. Other benefits 
may be introduced from time to time to ensure the benefits package is 
appropriately competitive and reflects individual circumstances. Benefits are 
reviewed annually and their value is not pensionable.

All Executive Directors receive a contribution to their personal pension plan and/
or receive a cash equivalent. This cash equivalent is not treated as salary for the 
purposes of determining bonus or incentive awards.

Pension
To provide a 
framework to save 
for retirement that 
is appropriately 
competitive.

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Great Portland Estates  Annual Report 2020

The Company’s policy is to provide remuneration packages that fairly reward the Executive Directors for the contribution they 
have made to the business and to ensure that the packages are appropriately competitive to promote the long-term success 
of the Company. The policy is to align the directors’ interests with those of shareholders and to incentivise the directors to 
meet the Company’s financial and strategic priorities by making a significant proportion of remuneration performance related. 
The Company’s strategic objectives are set out in the Strategic Report on pages 1 to 94.

The Committee is satisfied that the remuneration policy outlined in the table below is in the best interests of shareholders, 
does not raise any environmental, social or governance issues and does not promote excessive risk-taking.

Maximum opportunity

Performance metrics

Base salary increases will be in applied in line with the 
outcome of the review.

Individual and Company performances are 
considerations in setting base salary.

Key changes to last 
approved policy

No change.

In the normal course of events, increases in the base 
salaries will not exceed the average increase for 
employees. Increases may be made above this level 
to take account of market alignment to around mid-
market levels of comparable organisations (particularly 
within the listed property sector) and individual 
circumstances such as:

 – increase in scope and responsibility; and/or

 – to reflect the individual’s development and 

performance in the role (e.g. for a new appointment 
where base salary may be increased over time 
rather than set directly at the level of the previous 
incumbent or market level).

The Committee is, however, mindful of the need to 
treat comparisons with caution to avoid an upward 
ratchet of remuneration levels.

The salary maximum will be £650,000 (as increased by 
RPI from July 2017, currently c.£700,000).

Set at a level which the Committee considers:

Not applicable.

No change.

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 – appropriately positioned against comparable 

roles in companies of a similar size and complexity 
(particularly within the listed property sector); and

 – provides a sufficient level of benefits based on 
the role or an individual’s circumstances such 
as relocation.

Benefit values vary year on year depending on premiums 
and, therefore, the maximum value is the cost of the 
provision of these benefits. However, the aggregate 
value of contractual and non-contractual benefits 
received by each Executive Director (based on the value 
included in the individual’s annual P11D tax calculation) 
shall not exceed £100,000 p.a. (with this maximum 
increasing annually at the rate of RPI from 1 April 2014).

The contribution is a maximum of 20%.

Not applicable.

The current Executive Directors as at 1 April 2020 receive 
a contribution or cash equivalent equal to 20% of base 
salary. The contribution level for the current Executive 
Directors will be aligned with the average rate for all 
employees, by the end of 2022. Any new Executive 
Directors that are recruited will receive a contribution at 
no more than the same level as the average all-employee 
rate (as at the date of recruitment).

Contribution level 
for all Executive 
Directors will 
be aligned with 
the average 
all-employee 
contribution rate by 
the end of 2022.

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Directors’ remuneration report continued

Purpose and link to strategy

Operation and process

Variable  
remuneration

Annual Bonus Plan
Links reward to the 
annual performance 
targets, which are 
set on or about 
the beginning of 
the financial year 
in line with the 
Company’s strategy.

Ensures an alignment 
between the operation 
of the Directors’ 
remuneration policy 
and financial measures 
whilst also ensuring 
additional operational 
measures are targeted 
to encourage a 
holistic approach 
to performance.

Performance 
shares under 
the Long-Term 
Incentive Plan 
(LTIP)

Rewards and retains 
Executives aligning 
them with shareholder 
interests over a 
longer timeframe.

Ensures an alignment 
between the operation 
of the Company’s 
remuneration policy 
and the Company’s 
KPIs of achieving 
sustained TAR growth, 
above benchmark 
total property 
returns and superior 
shareholder returns.

The Annual Bonus Plan is reviewed annually at the start of the financial year 
to ensure bonus opportunity, performance measures and weightings are 
appropriate and continue to support the Company’s strategy.

Bonuses are paid in cash and shares. Up to 60% of any bonus will be paid in cash 
following the end of the financial year. At least 40% of any bonus outcome will be 
deferred into shares, typically through the new Deferred Share Bonus Plan (the 
DSBP) and normally for three years. The DSBP will be submitted to the 2020 AGM 
for shareholders to approve for a ten-year period.

Subject to clawback and malus provisions in situations of personal misconduct 
and/or where accounts or information relevant to performance are shown to be 
materially wrong and the bonus paid was higher than should have been the case.

The target bonus is 50% of maximum (i.e. 75% of base salary).

Threshold bonus is not more than 30% of base salary with 0% payable if the 
threshold is not met.

The LTIP was approved and adopted by shareholders in July 2010 with an initial 
ten-year term. It will be submitted to the 2020 AGM for renewal to permit the 
LTIP to operate for a further ten-year period.

LTIP
Participants are eligible to receive a conditional annual allocation of shares 
or nil price options (performance shares).

General terms
Awards may be adjusted to reflect the impact of any variation of share capital.

An award may, at the discretion of the Committee, include the right to receive 
cash or shares on vesting equal in value to the dividends payable on such 
number of shares subject to the award which vest, for the period between 
grant and vesting.

A two-year holding period will apply to awards following the end of the 
performance period. Awards will typically be structured as nil cost options 
exercisable from the end of the holding period.

Subject to clawback and malus provisions, for all employees in situations 
of personal misconduct and/or where accounts or information relevant 
to performance are shown to be materially wrong and vesting was higher 
than should have been the case; and malus only where there are sufficiently 
exceptional circumstances which impact the reputation of the Company.

The threshold vesting is 20% of awards with straight-line vesting to 100% 
for maximum performance. 

Awards under the LTIP may be adjusted to reflect the impact of any variation 
of share capital.

Quantum
The Committee reviews the quantum of awards annually.

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Key changes to last 
approved policy

Introduce:

 – deferral of 40% 
of any bonus 
outcome into 
shares for 
three years; and

 – Committee 
discretion to 
override formulaic 
outcomes to 
ensure the vesting 
is appropriate, 
taking into 
account 
performance of 
the Company, any 
individual, team 
or department. 

Introduce 
Committee 
discretion to 
adjust formulaic 
outcomes to 
ensure the vesting 
is appropriate, 
taking into account 
performance 
of the Company, 
any individual, team 
or department. 

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Maximum opportunity

Performance metrics

The maximum bonus is 150% of base salary. 

Up to 300% of salary.

At least 70% of the bonus will be linked to key 
financial measures, with the balance linked 
to personal or strategic objectives (including 
ESG factors). At least half of the combined 
opportunity relating to personal or strategic 
objectives will be objectively measurable.

The performance metrics are set by the 
Committee each year. The performance 
period for the Annual Bonus Plan targets is 
linked to the Company’s financial year.

The Committee may reduce formulaic 
bonus outcomes, if it considers them to be 
inconsistent with the performance of the 
Company, business or individual during 
the year. 

The Committee retains the ability to adjust the 
targets and/or set different measures if events 
occur which cause it to determine that the 
conditions are no longer appropriate and the 
amendment is required so that the conditions 
achieve their original purpose and are not, 
in the view of the Committee, materially 
less difficult to satisfy.

Further details on the measures for the 
financial year 2020/21 are set out on page 133.

Performance is assessed over not less 
than a three-year performance period 
against relevant shareholder value, financial 
and property related metrics (e.g. TSR or 
TAR growth).

The performance metrics are set by the 
Committee each year based on the strategic 
priorities of the business at that time, but 
no less than 50% will be assessed against 
a relative measure.

The Committee will also have a standard 
discretion to reduce the formulaic outcome 
of performance conditions if no longer 
appropriate in the circumstances (including 
the performance of the Company, any 
individual or business).

The Committee retains the ability to adjust the 
targets and/or set different measures if events 
occur which cause it to determine that the 
conditions are no longer appropriate and the 
amendment is required so that the conditions 
achieve their original purpose and are not 
materially less difficult to satisfy.

Further details on the measures for 
2020/21 awards are set out in the Directors’ 
remuneration report on page 133.

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Directors’ remuneration report continued

Purpose and link to strategy

Operation and process

All-employee  
share plans

Encourages Executive 
Directors and 
employees to acquire 
shares in order to 
increase the alignment 
of interests with 
shareholders over 
the longer term.

The Company operates a Share Incentive Plan (SIP) under which all employees, 
including Executive Directors, may be awarded free shares and may purchase 
shares which can be matched on up to a two for one basis. The Company’s 
current practice is to operate partnership and matching shares only. If the 
shares are held in a trust for at least three years and the employee does 
not leave the Company during that period, then the matched shares may 
be retained by the individual subject to some relief against income tax 
and National Insurance contributions.

Dividends are also paid directly to participants on all SIP shares.

In 2010, shareholders approved a Save As You Earn Scheme (SAYE) for all 
employees which is not currently operated but which might be utilised in the 
future. Under the SAYE, participants (which may include Executive Directors) 
may make monthly contributions over a savings period linked to the grant of 
an option with an exercise price which may be at a discount of up to 20% of 
the market value of the underlying shares at grant.

Awards under the SIP and SAYE may be adjusted to reflect the impact 
of any variation of share capital. 

The SIP and SAYE will each be submitted at the 2020 AGM for shareholders 
to approve a further ten-year term.

Executive Directors are expected to accumulate and maintain a holding in 
shares in the Company equivalent in value to no less than 300% of base salary. 

A post-cessation shareholding guideline will operate from the approval of this 
policy at the 2020 AGM. Executive Directors will be expected to retain the lower 
of actual shares held at cessation and shares equal to 300% of salary for two 
years post-cessation. This guideline will apply in respect of any vested shares 
which vest from DSBP and LTIP awards granted after the 2020 AGM (unless 
the Committee no longer considers it necessary). 

Shares retained following vesting of LTIP and/or DSBP awards granted after 
the 2020 AGM will be held in escrow to enable enforcement of post-cessation 
share ownership guidelines.

Shareholding  
policy

To ensure that 
Executive Directors’ 
interests are aligned 
with those of 
shareholders over a 
longer time horizon.

Notes to the Future Policy Table

1. Performance measures and targets
Short- and long-term performance measures will be selected by the Committee in order to provide a direct connection to the Company’s strategy by being 
linked to the key fundamental performance indicators at the time. In normal circumstances, they would be expected to include metrics such as TPR/capital 
growth, TAR targets and relative TSR performance. Relative measures will be assessed against appropriate comparators such as a relevant MSCI index and/
or an appropriate group of other UK listed real estate companies with similar operations. 

Absolute measures are set following a robust budget setting process which takes into account internal financial indicators as well as a broader view of the 
market environment.

The targets for the Annual Bonus are commercially sensitive and will be reported in the subsequent Directors’ remuneration report. The targets for the 
2020 LTIP award will be determined and disclosed by the Committee following the 2020 AGM, as explained on page 128. As referred to in the Committee 
Chairman’s statement, it is intended that appropriate targets will be set for each award cycle. The awards are also subject to an underpin under which the 
level of vesting may be reduced in certain circumstances.

The Committee is of the opinion that, given the commercial sensitivity around GPE’s business, disclosing individuals’ targets for the Annual Bonus Plan 
in advance would not be in the best interests of shareholders or the Company. Actual targets, performance achieved and awards made will be published 
at the end of performance periods so shareholders can fully assess the basis for any payouts.

2. Differences in remuneration policy for all employees
All employees of GPE are entitled to base salary and benefits on the same basis, with quantum of awards being set at levels commensurate with their role. 
All employees participate in an employee Annual Bonus Plan, with quantum of awards being set at levels commensurate with their role and with performance 
measures, similar to the executive scheme, based on Group performance and against personal objectives. Senior managers receive LTIP awards with 
quantum of awards being set at levels commensurate with their role. All employees are eligible to participate in the SIP and the SAYE on the same terms 
as the Executive Directors.

Employees who joined the Company before April 2002 are members of the Company’s defined benefit pension plan, and all other employees are eligible 
to join the Company’s defined contribution pension plan and receive a contribution of up to (currently) 10% of salary.

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Maximum opportunity

Performance metrics

Under the SIP, maximum participation will be in 
line with the prevailing maximum limits set by 
HMRC under the relevant legislation.

As is typical under HMRC tax-advantaged all-
employee plans, there are no performance 
conditions attached to awards.

Key changes to last 
approved policy

No changes.

Under the SAYE, maximum participation will be 
in line with the prevailing maximum limits set by 
HMRC under the relevant legislation.

Not applicable.

Not applicable.

Introduction 
of a two-year 
post-cessation 
shareholding 
guideline.

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3. Changes to remuneration policy from previous policy
The changes to previous policy have been noted in the table above. The inclusion of caps does not represent any aspiration.

4. Discretion
The Committee will operate the Annual Bonus Plan, LTIP and DSBP awards according to their respective rules and ancillary documents and in accordance 
with the Listing Rules where relevant. The Committee retains discretion consistent with market practice, in a number of regards to the operation and 
administration of these plans as noted in the policy table and in the recruitment remuneration and payments for loss of office sections as relevant. Any use 
of these discretions would, where relevant, be explained in the Directors’ remuneration report and may, as appropriate, be the subject of consultations with 
the Company’s major shareholders.

The all-employee tax-advantaged share plans will be operated in accordance with HMRC guidance and their respective rules. 

In addition, the Committee has the discretion to amend policy with regard to minor or administrative matters where it would be, in the opinion of the 
Committee, disproportionate to seek or wait for shareholder approval.

Details of share awards granted to existing Executive Directors are set out on page 139 of the Directors’ remuneration report. These remain eligible to vest 
based on their original award terms, in line with the policy set out in the policy table or under the authority of the previously approved remuneration policy 
(as will other legacy arrangements, including those awarded prior to promotion to the Board).

Annual Report 2020  Great Portland Estates 149

Directors’ remuneration report continued

Non-Executive Director remuneration

Element

Fees

Purpose and link 
to strategy

Provide an 
appropriate reward 
to attract individuals 
with appropriate 
knowledge and 
experience to review 
and support the 
implementation of the 
Company’s strategy.

Performance 
metrics

Not applicable.

Operation and process

Maximum opportunity

The Chairman and the Executive 
Directors are responsible for setting 
the remuneration of the Non-Executive 
Directors, other than the Chairman 
whose remuneration is determined 
by the Committee.

Non-Executive Directors are 
paid a base fee and additional fees for 
membership or chairmanship of 
Committees and for the role of Senior 
Independent Director.

Fees are usually reviewed annually 
with changes effective from 1 April.

Non-Executive Directors do 
not participate in any of the 
Company’s incentive arrangements. 
Other benefits include travel, 
accommodation and membership 
subscriptions related to the Company’s 
business. Reasonable business 
related expenses will be reimbursed 
(including any tax due thereon). 

Fees will be in line with market 
rates for Non-Executive Directors 
at FTSE 250 companies.

The aggregate maximum will 
be the limit stated in the Articles 
of Association, which is currently 
£600,000, but shareholders are 
being asked to increase this 
to £750,000 at the 2020 AGM. 

In the normal course, the 
Committee would generally 
consider awarding the Chairman 
(and the other directors would 
generally consider awarding 
the Non-Executive Directors) 
an annual increase in line with the 
rate of inflation for staff generally. 
However, this is not automatic 
and any decisions will be taken 
in the round.

The 2020/21 fee levels are set 
out on page 133.

Approach to recruitment remuneration
The Committee’s approach to recruitment remuneration is to pay no more than is necessary to attract appropriate candidates 
to the role, and our principle is that the pay of any new recruit would be assessed following the same principles as for the 
directors and the policy previously summarised.

Executive Director recruitment

Component

Policy

Base salary 
and benefits

Pension

Annual bonus

The salary level will be set taking into account relevant market data, the experience and skills of 
the individual, responsibilities of the individual and the salaries paid to similar roles in comparable 
companies in line with the current process undertaken by the Committee when setting the salary 
levels for its existing directors. Whilst it is not envisaged that it will be required, as provided for in the 
relevant regulations, the Committee reserves the right to exceed the fixed pay limits set out in the 
policy table, in exceptional circumstances, to secure the appointment of a high calibre individual. 

Executive Directors shall be eligible to receive benefits in line with the Company’s benefits policy 
as set out in the remuneration policy table. 

Executive Directors will be able to receive a pension contribution or receive a supplement in lieu 
of pension contributions in line with the Company’s pension policy as set out in the remuneration 
policy table.

Executive Directors will be eligible to participate in the Annual Bonus Plan with at least 40% of 
the bonus outcome normally subject to deferral under the proposed new DSBP as set out in the 
remuneration policy table. For Executive Directors joining part way through a year, awards would 
be pro-rated. Different performance measures may be set initially for the Annual Bonus Plan, taking 
into account the responsibilities of the individual, and the point in the financial year that they joined.

The annual maximum potential opportunity under this plan is 150% of salary.

Long-term  
incentives

Executive Directors will be eligible to participate in the LTIP set out in the remuneration policy 
table. Awards may be granted up to the maximum opportunity allowable under plan rules at the 
Committee’s discretion of 300% of salary under the LTIP. An award may be made on or shortly 
following an appointment assuming the Company is not in a prohibited period.

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Component

Policy

Share buyouts/
replacement  
awards

Relocation  
policies

Awards may be granted to replace those forfeited by the Executive Director from a previous 
employer on taking up the appointment where considered necessary by the Committee.

The Committee will seek to structure any replacement awards such that overall they are no more 
generous in terms of quantum or vesting period than the awards due to be forfeited. Where the 
Company compensates new directors in this way, it will seek to do so under the terms of the 
Company’s existing variable remuneration arrangements, but may compensate on terms that are 
more bespoke than the existing arrangements, including awards granted under Listing Rule 9.4.2, 
where the Committee considers this to be appropriate. In such instances, the Company will disclose 
a full explanation of the detail and rationale for such recruitment related compensation. In making 
such awards, the Committee will seek to take into account the nature (including whether awards 
are cash or share-based), vesting period and performance measures and/or conditions for any 
remuneration forfeited by the individual in leaving a previous employer. Where such awards had 
outstanding performance or service conditions (which are not significantly completed), the Company 
will generally impose equivalent conditions. In exceptional cases the Committee may relax those 
requirements where it considers this to be in the interest of the shareholders, for example through 
applying a significant discount to the face value of the replacement awards.

In instances where the new Executive Director is non-UK domiciled or needs to be relocated, 
the Company may provide one-off or ongoing compensation as part of the Executive Director’s 
relocation benefits to reflect the cost of relocation for the Executive in cases where they are 
expected to spend significant time away from their country of domicile.

The level of the relocation package will be assessed on a case-by-case basis and may take into 
consideration any cost of living differences, housing allowance and/or schooling.

Legacy  
arrangements

Where an Executive Director is appointed from within the organisation, the normal policy of the Company 
is that any legacy arrangements would be honoured in line with the original terms and conditions on a pro 
rata basis. Similarly, if an Executive Director is appointed following the Company’s acquisition or merger 
with another company, legacy terms and conditions on a pro rata basis would be honoured.

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Non-Executive Director recruitment

Component

Policy

Fees

Newly appointed Non-Executive Directors will be paid fees consistent with existing Non-
Executive Directors.

Service agreements and payments for loss of office
The policy of the Company is to have service contracts for Executive Directors with notice periods of one year. It is sometimes 
necessary when recruiting a new Executive Director to give a service contract with an initial term of up to 18 months in which 
case a 12-month notice period may be given no earlier than six months from the start date or the contract.

Non-Executive Directors, who have letters of appointment, are subject to the provisions of the Articles of Association dealing 
with appointment and rotation every three years, however, in accordance with the UK Corporate Governance Code they are 
subject to annual re-election and have a notice period of three months by either party. They are not eligible for payment in 
lieu of notice or any other payment on termination.

The following table sets out the dates of each of the Executive Directors’ service agreements and their unexpired term, 
the dates of the Non-Executive Directors’ letters of appointment and the date on which the Non-Executive Director is 
next subject to reappointment or re-election.

Executive

Toby Courtauld

Nick Sanderson

Non-Executive

Richard Mully

Charles Philipps

Wendy Becker

Nick Hampton

Alison Rose

Vicky Jarman1

Date of service agreement

18 March 2002 (amended 2017)

7 June 2011 (amended 2017)

Unexpired term (months)

12

12

Date of appointment letter

Date when next subject to appointment or re-election

12 October 2016

10 January 2014

12 January 2017

28 September 2016

4 April 2018 

22 January 2020

24 July 2020

24 July 2020

24 July 2020

24 July 2020

24 July 2020

24 July 20201

1.  Vicky Jarman was appointed to the Board on 1 February 2020 and will be subject to election at the next AGM on 24 July 2020. 

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Directors’ remuneration report continued

Executive Directors may, with the consent of the Committee, retain fees paid to them for acting as a Non-Executive Director 
of a company outside the Group, except where the directorship is as a representative of the Group.

The Company’s policy on termination payments for Executive Directors is to consider the circumstances on a case-by-case 
basis, taking into account the relevant contractual terms, the circumstances of the termination and any applicable duty to 
mitigate. It is the Committee’s policy not to reward poor performance. The Committee will always seek to minimise the 
cost to the Company whilst seeking to reflect the circumstances in place at the time. The Committee will honour Executive 
Directors’ contractual entitlements. Service contracts do not contain liquidated damages clauses. If a contract is to be 
terminated, the Committee will determine such mitigation as it considers fair and reasonable in each case. There are no 
contractual arrangements that would guarantee a pension with limited or no abatement on severance or early retirement. 
There is no agreement between the Company and its directors or employees, providing for compensation for loss of office 
or employment that occurs because of a takeover bid. The Company reserves the right to make additional payments where 
such payments are made in good faith in discharge of an existing legal obligation (or by way of damages for breach of such 
an obligation); or by way of settlement or compromise of any claim arising on connection with the termination of an Executive 
Director’s office or employment. The Company may also deem it appropriate to pay on behalf of a departing Executive 
modest legal, outplacement or other fees. 

Contracts include a right for the Company to achieve mitigation through payment on a monthly phased basis with payments 
reducing/ceasing if an alternative role is found during the balance of any notice period.

Base salary, benefits and pension
Toby Courtauld’s compensation in lieu of notice payable at the Company’s discretion is 12 months’ basic salary. 
Compensation in lieu of notice to Nick Sanderson, payable at the Company’s discretion, is 12 months’ basic salary, pension 
allowance and the value of benefits in kind provided in the previous year, or the actual provision of those benefits.

Approach to other remuneration payments on termination of employment and change of control
In addition to the payment of base salary, benefits and pension as set out above, the Group’s Annual Bonus Plan, LTIP, DSBP, 
SIP and SAYE contain provisions for the termination of employment.

Component

Good Leaver*

Bad Leaver**

Change of control

Outstanding award is forfeited.

An Executive Director may 
receive a bonus, the amount 
of which will be determined 
by the Committee, taking 
into account such factors as it 
considers relevant, including 
the proportion of the elapsed 
performance period at the 
date of change of control and 
performance to that point. 

Annual Bonus  
Plan

Where an Executive Director’s 
employment is terminated after 
the end of a performance year 
but before the payment is made, 
the Executive will be eligible 
for an annual bonus award for 
that performance year subject 
to an assessment based on 
performance achieved over 
the period.

Where an Executive Director’s 
employment is terminated 
during a performance year, a pro 
rata annual bonus for the period 
worked in that performance year 
may be payable in relation to 
that year’s bonus (in the case of 
injury, ill health, disability, death 
or retirement) or in relation to 
personal objectives set only (in 
other Good Leaver cases).

Deferred Share Bonus 
Plan (DSBP)

Awards may be retained 
until the normal vesting date. 
In exceptional circumstances 
the Committee may accelerate 
vesting at the date of cessation.

Outstanding awards lapse.

In accordance with the rules of 
the DSBP, outstanding awards 
will normally vest in full on a 
change of control.

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Component

Good Leaver*

Bad Leaver**

Change of control

Long Term Incentive 
Plan (LTIP)

Share Incentive Plan 
(SIP)

Save As You Earn 
Scheme (SAYE)

Awards may vest at the date of 
cessation of employment or the 
normal vesting date (including 
any applicable holding period) at 
the discretion of the Committee.

Awards will vest based on the 
performance achieved up to 
the date of cessation/normal 
vesting date at the discretion 
of the Committee and be pro-
rated to reflect the amount of 
time elapsed since the award 
date. The Committee retains 
the discretion to disregard 
time when determining the 
level of vesting. This would only 
be considered in exceptional 
circumstances and where 
considered, the Committee 
would take into account the 
circumstances of the cessation 
of employment.

Upon death, all long-term 
incentive awards vest 
immediately in full.

All shares can be sold or 
transferred out of the SIP. Free, 
matching and partnership 
shares may be removed tax free. 
If dividend shares are taken out 
of the SIP within three years of 
being awarded, the dividend 
used to buy them is subject to 
income tax at the dividend rate.

On resignation, matched 
shares held for less than 
three years will be forfeited.

Options may be exercised 
during a period of six months 
following cessation of 
employment (or 12 months 
following cessation in the 
event of death).

* 

 Good leavers under each of the Annual Bonus Plan, LTIP, DSBP, SIP and 
SAYE are those leaving under specified conditions as set out below.

Annual Bonus Plan and LTIP:

 – death;

 – ill-health, injury or disability (evidenced to the satisfaction of 

the Committee);

 – redundancy;

 – retirement;

 – the award holder’s employing company or business being transferred 

out of the Group; or

Outstanding awards lapse.

In accordance with the 
rules of the LTIP, on a 
change of control, vesting 
will occur immediately. 
Performance against targets 
will be assessed by the 
Committee on a change 
of control. The number of 
shares vesting will normally 
be reduced pro rata to 
reflect the amount of time 
elapsed from the award 
date until the change of 
control as a proportion of 
the original vesting period. 
The Committee retains the 
discretion to disregard time 
when determining the level 
of vesting. This would only 
be considered in exceptional 
circumstances and where 
considered, the Committee 
would take into account the 
overall context of the deal 
and the actual value delivered 
to shareholders.

Free shares and matched shares 
held for less than three years will be 
forfeited. Partnership and matched 
shares held for more than three 
years but less than five years will 
be liable to tax depending on time 
held in the SIP. If dividend shares 
are taken out of the SIP within 
three years of being awarded, 
the dividend used to buy them 
is subject to income tax at the 
dividend rate.

All shares can be sold 
or transferred out of the 
SIP. Free, matching and 
partnership shares may be 
removed tax free. If dividend 
shares are taken out of 
the SIP within three years 
of being awarded, the 
dividend used to buy them 
is subject to income tax at 
the dividend rate.

Options held for less than three 
years will lapse on cessation. 
Options held for more than three 
years may be exercised during 
a period of six months following 
cessation, except where the reason 
for cessation is misconduct.

Options may be exercised 
in the event of a change of 
control of the Company.

 – any other circumstances at the discretion of the Committee, including 

where appropriate (and exceptionally), resignation. The Committee will 
only use its general discretion where it considers this to be appropriate, 
taking into account the circumstances of the termination and the 
performance in the context of each plan and will provide a full explanation 
to shareholders of the basis of its determination. The exercise of the 
Committee’s discretion under one plan will not predetermine the 
exercise of its discretion under another.

Under the DSBP all leavers will be considered ‘good’, expect where the 
employee is dismissed for misconduct.

Good leavers under the SIP and SAYE are those participants leaving in 
certain circumstances as under applicable legislation including death, 
injury, disability, retirement and redundancy.

**  Bad leavers are those leavers who are not good leavers.

Annual Report 2020  Great Portland Estates 153

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Directors’ remuneration report continued

Consideration of remuneration of other employees
Our approach to salary reviews is consistent across 
the Company, with consideration given to the level of 
responsibility, experience, individual performance, salary 
levels in comparable companies and the Company’s 
ability to pay. Remuneration surveys and meetings with 
sector specialists are used, where appropriate, to establish 
market rates.

When determining remuneration of the Executive Directors, 
the Committee takes into account pay and conditions 
across the Group, especially when determining the 
annual salary increase. Prior to the annual pay review, the 
Committee receives a report setting out changes to all 
employee remuneration levels and proposed discretionary 
bonus awards.

While the Company engages with employees on 
remuneration generally, including executive remuneration, 
it did not formally consult with employees on the policy or 
use any remuneration comparison metrics during the year 
reported. The Chairman of the Committee is intending to 
invite all staff to attend a session to discuss remuneration and 
the 2020 policy revisions later this year, following the AGM.

Further details of how the Committee has considered the 
broad operation of the remuneration policy and practices for 
all employees can be found on page 126.

Consideration of shareholder views
When determining remuneration, the Committee takes into 
account the guidelines of investor bodies and shareholder 
views. The Committee is always open to feedback from 
shareholders on remuneration policy and arrangements, and 
commits to undertaking shareholder consultation in advance 
of any significant changes to the remuneration policy. 

The proposed 2020 remuneration policy has been subject to 
thorough consultation with our major shareholders and the 
main proxy voting advisors.

Deliberation and process
The Committee ensures it seeks independent advice as 
appropriate and the Committee also has access to HR 
and company secretariat without the executives present. 
Consistent with good practice, any decisions are taken 
without the affected individual present.

This report will be submitted to shareholders for approval 
at the AGM to be held on 24 July 2020. 

Approved by the Board on 9 June 2020 and signed on its 
behalf by:

Wendy Becker
Chairman of the Remuneration Committee 
9 June 2020

5,000

4,000

3,000

2,000

1,000

0

3,500

3,000

2,500

2,000

1,500

1,000

500

0

Executive Director remuneration scenarios based 
on performance 
The charts below set out the potential remuneration 
receivable by Executive Directors for minimum, where 
performance is below threshold for variable awards, on-target 
and maximum performance. Potential reward opportunities 
are based on the remuneration policy and applied to salaries 
for the year ending 31 March 2021. It should be noted the 
projected values exclude the impact of any dividend accrual. 

Chief Executive £000

4,461

2,768 (62%)

3,538

1,845 (52%)

770

1,600

369 (23%)

461 (29%)

923 (26%)

922 (21%)

770 (100%)

770 (48%)

770 (22%)

770 (17%)

Minimum

On target

Maximum

Fixed1

Annual bonus

LTIP

Finance and Operations Director £000

Maximum
with 50% share 
price increase

3,072

1,904 (62%)

2,437

1,269 (52%)

1,104

254 (23%)

317 (29%)

533

635 (26%)

635 (21%)

533 (100%)

533 (48%)

533 (22%)

533 (17%)

Minimum

On target

Maximum

Fixed1

Annual bonus

LTIP

Maximum
with 50% share 
price increase

1.  The Fixed amounts in the charts reflect the increased full annual salaries 
that will take effect from 1 July 2020 subject to the Committee being 
satisfied that lockdown restrictions have been sufficiently lifted at that time. 
Salaries have not been pro-rated for these purposes.

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Report of the directors

Strategic Report
The Group’s Strategic Report on pages 1 to 94 includes the 
Company’s business model and strategy, principal risks and 
uncertainties facing the Group and how these are managed 
and mitigated, an indication of likely future developments in 
the Company and details of important events since the year 
ended 31 March 2020.

The purpose of the Annual Report is to provide information 
to the members of the Company, as a body. The Company, 
its directors, employees, agents or advisors do not accept 
or assume responsibility to any other person to whom this 
document is shown or into whose hands it may come and 
any such responsibility or liability is expressly disclaimed. 
The Annual Report contains certain forward-looking 
statements with respect to the operations, performance 
and financial condition of the Group. By their nature, these 
statements involve uncertainty since future events and 
circumstances can cause results and developments to differ 
from those anticipated. The forward-looking statements 
reflect knowledge and information available at the date of 
preparation of this Annual Report. Nothing in this Annual 
Report should be construed as a profit forecast.

Results and dividends for the year
The Group’s results for the year are set out on pages 160 to 
186. An interim dividend of 4.7 pence per share (2019: 4.3 
pence) was paid on 2 January 2020, and the directors propose 
to pay a final dividend of 7.9 pence per share on 28 July 2020 
to shareholders on the register of members as at the close of 
business on 29 May 2020. This makes a total of 12.6 pence per 
share (2019: 12.2 pence) for the year ended 31 March 2020.

Directors
Biographical details of the current directors of the Company 
are shown on pages 54 and 55.

In accordance with the UK Corporate Governance Code, 
all the directors will retire and will offer themselves 
for election or re-election at the forthcoming Annual 
General Meeting.

Directors’ shareholdings
The interests of the directors of the Company (and of their 
connected persons) in the shares of the Company, which have 
been notified to the Company in accordance with the Market 
Abuse Regulation, are set out in the Directors’ remuneration 
report on pages 139 and 140. The Directors’ remuneration 
report also sets out details of any changes in those interests 
between 31 March 2020 and 8 June 2020. 

Directors’ indemnities and insurance 
On 14 September 2007, an indemnity was given by the 
Company to the directors in terms which comply with 
company law. The indemnity was in force during the year and 
remains in force at the date of this Report of the directors.

The Company maintains directors’ and officers’ liability 
insurance and pension trustee liability insurance, both 
of which are reviewed annually.

Directors’ powers
The powers of the directors are contained in the Company’s 
Articles of Association. These include powers, subject to 
relevant legislation, to authorise the issue and buyback of 
the Company’s shares by the Company, subject to authority 
being given to the directors by the shareholders in a 
general meeting.

Appointment and replacement of directors
The rules about the appointment and replacement of 
directors are contained in the Company’s Articles of 
Association. Under the Articles of Association, a director shall 
retire from office if he or she has been appointed since the 
previous Annual General Meeting or if it is the third Annual 
General Meeting following that at which he or she was 
elected or last re-elected. Notwithstanding the provisions 
of the Articles of Association, the Board has agreed that 
all directors will retire and seek election or re-election at 
each Annual General Meeting in accordance with the UK 
Corporate Governance Code.

Changes to the Articles of Association must be approved 
by the Company’s shareholders in accordance with legislation 
in force from time to time.

Corporate governance statement
The information fulfilling the requirements of the corporate 
governance statement can be found in this Report of 
the directors and on pages 96 to 154, all of which are 
incorporated into this Report of the directors by reference.

Political donations
It is the Company’s policy not to make political donations or 
undertake any activities incurring political expenditure.

Annual General Meeting 
The Company’s Annual General Meeting will be held at Kent 
House, 14/17 Market Place, London W1W 8AJ on 24 July 2020 
at 1pm. In light of the COVID-19 pandemic and public health 
guidance, this year’s AGM is currently intended to be held as 
a closed meeting. While shareholders will, regrettably, not 
be permitted to attend the AGM in person, shareholders 
are encouraged to submit their proxy voting instructions as 
early as possible and to raise any questions in advance of the 
meeting via e-mail. Please refer to the Notice of AGM 2020 
for further details.

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Report of the directors continued

Additional disclosures
Disclosures required by the Financial Conduct Authority’s 
Listing Rule 9.8.4 and Schedule 7, Large and Medium-sized 
Companies and Groups (Accounts and Reports) Regulations 
2008 (as amended), to the extent not already disclosed or 
referred to in this Report of the directors, can be found on the 
following pages, all of which are incorporated into this Report 
of the directors by reference:

Capitalised interest

Financial instruments

Greenhouse gas emissions, energy consumption 
and energy efficient action

Page

170 and 174

168, 180 to 182

75 to 76

Engagement with suppliers, customers and others

58 to 66, 103 to 106

Research and development

Director waiver of emoluments

32, 37, 41, 58, 59, 69, 73

133

The Directors’ responsibilities statement is on page 158 and 
is incorporated into this Report of the directors by reference.

Significant shareholdings
As at 31 March 2020, the Company had been notified, in 
accordance with the Financial Conduct Authority’s Disclosure 
Guidance and Transparency Rules (DTR 5), of the following 
interests in the voting rights in its ordinary share capital:

T.Rowe Price Associates, Inc.

Norges Bank Investment Management

BlackRock Inc.

Standard Life Aberdeen plc

1.  As at date of notification.

Number of
voting rights1

28,233,061

26,778,630

24,570,390

10,366,321

%1

11.12

10.00

8.72

4.00

In the period from 31 March 2020 to 8 June 2020 the 
Company was notified that Norges Bank Investment 
Management now holds voting rights in respect of 28,329,893 
GPE shares, representing 11.15% of the total voting rights in 
the Company.

Information provided to the Company under the Financial 
Conduct Authority’s Disclosure Guidance and Transparency 
Rules is publicly available via the regulatory information 
service and on the Company’s website.

Share capital and control
As at 31 March 2020, the issued share capital of the 
Company was 253,867,911 (2019: 271,365,894) ordinary shares 
of 155/19 pence each, all fully paid up and listed on the London 
Stock Exchange. 

At the 2019 Annual General Meeting, shareholders authorised 
the Company to make market purchases of up to 40,677,747 
ordinary shares of 155/19 pence each, representing 14.99% of 
the issued share capital of the Company as at 21 May 2019, 
such authority to expire at the earlier of the conclusion of 
the 2020 Annual General Meeting or 1 October 2020. 

During the year and in accordance with the authorities 
obtained from shareholders at the 2018 and 2019 Annual 
General Meetings, the Company continued with its share 
buyback programme which had originally commenced on 
15 November 2018. The share buyback programme sought 
to repurchase ordinary shares for a maximum aggregate 
consideration of £200.0 million during a 12-month period from 
15 November 2018, subject to certain pre-set parameters and 
up to a maximum of 42,221,384 ordinary shares. The purpose 
of the share buyback programme was to return surplus 
equity to shareholders and through the reduction of the 
Company’s issued share capital it reflects the directors’ 
ongoing commitment to capital allocation and balance 
sheet discipline. 

From 15 November 2018 to 29 March 2019, the Company 
purchased 10,297,781 ordinary shares of 155/19 pence each 
(which represented 3.8% of the called-up share capital of the 
Company as at 31 March 2019) for an aggregate consideration 
of £74.1 million (£74.8 million including costs). The average 
price paid per share was £7.20 (or £7.26 per share including 
costs). All of the purchased shares were cancelled. 

No further share purchases were made by the Company 
between 29 March 2019 and 21 May 2019 and the programme 
recommenced on 22 May 2019 and ended on 13 November 
2019. During this period, the Company purchased 17,497,983 
ordinary shares of 155/19 pence each (which represented 6.9% 
of the called-up share capital of the Company as at 31 March 
2020) for an aggregate consideration of £125.9 million 
(£126.7 million including costs). The average price paid per 
share was £7.19 (or £7.24 per share including costs). All of 
the purchased shares were cancelled. Further details on 
the share buyback can be found on pages 45 and 79.

There are no restrictions on transfer or limitations on the 
holding of the ordinary shares. None of the shares carry any 
special rights with regard to the control of the Company. 
There are no known arrangements under which financial 
rights are held by a person other than the holder of the 
shares and no known agreements on restrictions on share 
transfers and voting rights. The Great Portland Estates plc 
LTIP Employee Share Trust (the Trust) is an employee share 
scheme which holds ordinary shares in the Company on trust 
for the benefit of employees within the Group. The Trustee of 
the Trust has the power to exercise all the rights and powers 
(including rights with regard to control of the Company) 
incidental to, and to generally act in relation to, the ordinary 
shares subject to the Trust in such manner as the Trustee in its 
absolute discretion thinks fit as if it were absolutely entitled 
to those ordinary shares. The Trustee has waived the right to 
receive dividends on the shares held in the Company. 

156

Great Portland Estates  Annual Report 2020

Statement as to disclosure of information 
to the auditor
So far as the directors who held office at the date of approval 
of this Report of the directors are aware, there is no relevant 
audit information of which the auditor is unaware and each 
director has taken all steps that he or she ought to have taken 
as a director to make himself or herself aware of any relevant 
audit information and to establish that the auditor is aware 
of that information. This confirmation is given and should be 
interpreted in accordance with the provisions of section 418 
of the Companies Act 2006.

By order of the Board
Darren Lennark
Company Secretary

Great Portland Estates plc 
Company number: 596137 
9 June 2020

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Change of control
The Company has a number of unsecured borrowing facilities 
provided by various lenders. These facilities generally include 
provisions that may require any outstanding borrowings to 
be repaid or the alteration or termination of the facilities 
upon the occurrence of a change of control of the Company. 
The Company’s 2010 LTIP and Executive Annual Bonus Plan 
contain provisions relating to the vesting of awards in the 
event of a change of control.

Going concern 
The Group’s business activities, together with the factors 
affecting its performance, including the COVID-19 pandemic, 
are set out in the Strategic Report on pages 1 to 94. 
Details of the finances of the Group, including its strong 
liquidity position, attractively priced borrowing facilities and 
favourable debt maturity profile are set out in ‘Our financial 
results’ on pages 42 to 45 and in notes 17 and 18 of the 
financial statements on pages 179 to 182.

The directors have reviewed the current and projected 
financial position of the Group, making reasonable 
assumptions about future trading performance, with 
particular focus on the impact of COVID-19 on the macro-
economic conditions in which the Group is operating. As part 
of the review, the directors have modelled a series of market 
scenarios to further understand the resilience of the business 
to the impact of COVID-19. This included a going concern 
scenario to consider the impact of market disruption on the 
Group’s cash balances, its capital commitments, its debt 
maturity profile, including undrawn facilities, its levels of 
rent collection and the long-term nature of occupier leases. 
Further information on the assumptions contained in the 
going concern scenario is on page 164. On the basis of this 
review, and after making due enquiries, the directors have 
a reasonable expectation that the Company and the Group 
have adequate resources to continue in operational existence 
for a period of at least 12 months from the date of approval of 
the financial statements. Accordingly, they continue to adopt 
the going concern basis in preparing the Annual Report and 
financial statements.

Viability statement
The Company’s viability statement is on page 94.

Annual Report 2020  Great Portland Estates 157

Directors’ responsibilities statement

The directors are responsible for the maintenance and 
integrity of the corporate and financial information included 
on the Company’s website. Legislation in the United Kingdom 
governing the preparation and dissemination of financial 
statements may differ from legislation in other jurisdictions.

Responsibility statement 
We confirm that to the best of our knowledge:

 – the financial statements, prepared in accordance with the 
relevant financial reporting framework, give a true and fair 
view of the assets, liabilities, financial position and profit or 
loss of the Company and the undertakings included in the 
consolidation taken as a whole;

 – the Strategic Report includes a fair review of the 

development and performance of the business and the 
position of the Company and the undertakings included 
in the consolidation taken as a whole, together with a 
description of the principal risks and uncertainties that 
they face; and

 – the Annual Report and financial statements, taken as a 

whole, are fair, balanced and understandable and provide 
the information necessary for shareholders to assess 
the Company’s position, performance, business model 
and strategy.

This responsibility statement was approved by the Board 
of Directors and is signed on its behalf by:

Toby Courtauld 
Chief Executive 
9 June 2020  

Nick Sanderson
Finance and Operations Director 
9 June 2020

The directors are responsible for preparing the Annual Report 
and the financial statements in accordance with applicable 
law and regulations.

Company law requires the directors to prepare financial 
statements for each financial year. Under that law the 
directors are required to prepare the Group financial 
statements in accordance with International Financial 
Reporting Standards (IFRSs) as adopted by the European 
Union and Article 4 of the IAS Regulation and have elected 
to prepare the parent company financial statements in 
accordance with United Kingdom Generally Accepted 
Accounting Practice (United Kingdom Accounting Standards 
and applicable law), including FRS 101 ‘Reduced Disclosure 
Framework’. Under Company law the directors must not 
approve the accounts unless they are satisfied that they give a 
true and fair view of the state of affairs of the Company and of 
the profit or loss of the Company for that period. 

In preparing the parent company financial statements, 
the directors are required to:

 – select suitable accounting policies and then apply 

them consistently;

 – make judgements and accounting estimates that are 

reasonable and prudent;

 – state whether applicable UK Accounting Standards 

have been followed, subject to any material departures 
disclosed and explained in the financial statements; and

 – prepare the financial statements on the going concern 
basis unless it is inappropriate to presume that the 
Company will continue in business.

In preparing the Group financial statements, International 
Accounting Standard 1 requires that directors:

 – properly select and apply accounting policies;

 – present information, including accounting policies, in 
a manner that provides relevant, reliable, comparable 
and understandable information; 

 – provide additional disclosures when compliance with the 
specific requirements in IFRSs are insufficient to enable 
users to understand the impact of particular transactions, 
other events and conditions on the entity’s financial 
position and financial performance; and

 – make an assessment of the Company’s ability to continue 

as a going concern.

The directors are responsible for keeping adequate 
accounting records that are sufficient to show and explain 
the Company’s transactions and disclose with reasonable 
accuracy at any time the financial position of the Company 
and enable them to ensure that the financial statements 
comply with the Companies Act 2006. They are also 
responsible for safeguarding the assets of the Company 
and hence for taking reasonable steps for the prevention and 
detection of fraud and other irregularities.

158

Great Portland Estates  Annual Report 2020

 
 
 
Financial statements

In this section:

160 Group income statement

160 Group statement of comprehensive income

161 Group balance sheet

162 Group statement of cash flows

163 Group statement of changes in equity

164 Notes forming part of the 
Group financial statements

187

Independent auditor’s report

197 Company balance sheet

199 Notes forming part of the 

Company financial statements

A 
S P A C E 
T O   
C H I L L

Space to relax as the boundaries between  
work and leisure blur

Annual Report 2020  Great Portland Estates 159

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Group income statement
For the year ended 31 March 2020

Total revenue

Net rental income
Joint venture management fee income
Rental and joint venture fee income
Property expenses
Net rental and related income
Administration expenses
Development management revenue
Development management costs
Development management losses
Trading property revenue
Trading property cost of sales
Profit/(loss) on sale of trading property 
Operating profit before (deficit)/surplus on property and results of joint ventures
(Deficit)/surplus from investment property
Share of results of joint ventures
Operating profit
Finance income
Finance costs
Fair value movement on convertible bond
Profit before tax
Tax
Profit for the year

Basic earnings per share
Diluted earnings per share
Basic EPRA earnings per share
Diluted EPRA earnings per share

All results are derived from continuing operations in the United Kingdom and are attributable to ordinary equity holders. 

Notes

2

3
12

4

5

11

10
12

6
7

8

9
9
9
9

2020 
£m

102.4

2019 
£m

112.4

79.9
2.1
82.0
(8.1)
73.9
(29.0)
–
(0.2)
(0.2)
6.4
(5.6)
0.8
45.5
(52.6)
57.9
50.8
7.3
(6.5)
–
51.6
0.2
51.8

20.0p
20.0p
22.0p
22.0p

80.3
3.8
84.1
(11.9)
72.2
(25.1)
–
(0.3)
(0.3)
14.4
(23.9)
(9.5)
37.3
7.3
10.0
54.6
8.3
(8.1)
1.3
56.1
(6.6)
49.5

17.9p
17.1p
19.5p
19.4p

Group statement of comprehensive income
For the year ended 31 March 2020

Profit for the year
Items that will not be reclassified subsequently to profit and loss
Actuarial loss on defined benefit scheme
Deferred tax on actuarial loss on defined benefit scheme
Total comprehensive income and expense for the year

Notes

26

2020 
£m

51.8

(0.4)
–
51.4

2019
£m

49.5

(0.9)
0.2
48.8

160

Great Portland Estates  Annual Report 2020

Group balance sheet
At 31 March 2020

Non-current assets
Investment property
Investment in joint ventures
Property, plant and equipment
Other investments

Current assets
Trading property
Trade and other receivables
Corporation tax
Cash and cash equivalents

Total assets
Current liabilities
Trade and other payables
Corporation tax

Non-current liabilities
Interest-bearing loans and borrowings

Obligations under head leases
Obligations under occupational leases
Pension liabilities
Deferred tax

Total liabilities
Net assets

Equity
Share capital
Share premium account
Capital redemption reserve
Retained earnings
Investment in own shares
Total equity

Basic net assets per share
EPRA NAV

Approved by the Board on 9 June 2020 and signed on its behalf by:

Toby Courtauld 
Chief Executive 

Nick Sanderson
Finance and Operations Director

Notes

2020 
£m

2019 
£m

10
12
13
14

11
15
8

16
8

17

19
20
26
8

21

21

22

9
9

1,987.1
647.0
7.5
0.2
2,641.8

–
16.1
0.5
94.9
111.5
2,753.3

(60.0)
–
(60.0)

(444.3)

(40.7)
(4.8)
(0.4)
–
(490.2)
(550.2)
2,203.1

38.7
46.0
326.7
1,792.3
(0.6)
2,203.1

868p
868p

2,025.0
511.9
4.0
–
2,540.9

5.6
10.9
–
139.4
155.9
2,696.8

(47.1)
(3.3)
(50.4)

(296.0)

(40.7)
–
–
–
(336.7)
(387.1)
2,309.7

41.4
46.0
324.0
1,900.0
(1.7)
2,309.7

851p
853p

Annual Report 2020  Great Portland Estates 161

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Group statement of cash flows
For the year ended 31 March 2020

Operating activities
Operating profit
Adjustments for non-cash items
Decrease in trading property
(Increase)/decrease in receivables
Increase/(decrease) in payables
Cash generated from operations
Interest paid
Interest received
Tax paid
Cash flows from operating activities
Investing activities
Distributions from joint ventures
Funds to joint ventures
Purchase of other investments
Purchase and development of property
Purchase of plant and equipment 
Sale of properties
Investment in joint ventures
Cash flows from investing activities
Financing activities
Revolving credit facility drawn
Repayment of convertible bond
Issue of private placement notes
Purchase of own shares
Capital returned via a B share scheme
Payment of lease obligations
Dividends paid
Cash flows from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at 1 April
Cash and cash equivalents at 31 March

Notes

23

17
17
17
21

24

2020 
£m

50.8
(2.4)
4.9
(6.4)
4.8
51.7
(10.1)
0.6
(3.6)
38.6

4.6
(56.9)
(0.2)
(64.6)
(0.1)
66.9
(18.0)
(68.3)

149.1
–
–
(127.8)
–
(2.8)
(33.3)
(14.8)
(44.5)
139.4
94.9

2019 
£m

54.6
(13.7)
13.4
2.2
(13.5)
43.0
(12.3)
1.3
(5.0)
27.0

10.1
(35.6)
–
(47.6)
(0.1)
342.1
(45.6)
223.3

–
(149.6)
99.7
(73.7)
(306.0)
–
(32.7)
(462.3)
(212.0)
351.4
139.4

162

Great Portland Estates  Annual Report 2020

Group statement of changes in equity
For the year ended 31 March 2020

Total equity at 1 April 2019
Adoption of IFRS 16
Total equity at 1 April 2019 restated
Profit for the year
Actuarial loss on defined benefit scheme
Total comprehensive income for the year
Employee Long-Term Incentive Plan charge
Dividends to shareholders
Share buyback
Transfer to retained earnings
Total equity at 31 March 2020

Notes

22
24
21
22

Share 
capital 
£m

41.4
–
41.4
–
–
–
–
–
(2.7)
–
38.7

Share  
premium 
account 
£m

Capital 
redemption 
reserve 
£m

46.0
–
46.0
–
–
–
–
–
–
–
46.0

324.0
–
324.0
–
–
–
–
–
2.7
–
326.7

Retained 
earnings 
£m

1,900.0
(0.7)
1,899.3
51.8
(0.4)
51.4
–
(33.2)
(126.7)
1.5
1,792.3

Investment  
in own  
shares  
£m

(1.7)
–
(1.7)
–
–
–
2.6
–
–
(1.5)
(0.6)

Total  
equity  
£m

2,309.7
(0.7)
2,309.0
51.8
(0.4)
51.4
2.6
(33.2)
(126.7)
–
2,203.1

Group statement of changes in equity
For the year ended 31 March 2019

Total equity at 1 April 2018
Profit for the year
Actuarial loss on defined benefit scheme
Deferred tax on actuarial loss on defined 
benefit scheme
Total comprehensive income for the year
Employee Long-Term Incentive Plan charge
Dividends to shareholders
Share buyback
Transfer to retained earnings
Total equity at 31 March 2019

Share 
capital 
£m

Share  
premium 
account 
£m

Capital 
redemption 
reserve 
£m

Notes

43.0
–
–

–
–
–
–
(1.6)
–
41.4

46.0
–
–

–
–
–
–
–
–
46.0

322.4
–
–

–
–
–
–
1.6
–
324.0

22
24
21
22

Retained 
earnings 
£m

1,957.9
49.5
(0.9)

0.2
48.8
–
(32.5)
(74.8)
0.6
1,900.0

Investment  
in own  
shares  
£m

(2.4)
–
–

–
–
1.3
–
–
(0.6)
(1.7)

Total  
equity  
£m

2,366.9
49.5
(0.9)

0.2
48.8
1.3
(32.5)
(74.8)
–
2,309.7

Annual Report 2020  Great Portland Estates 163

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Notes forming part of the Group financial statements

1 Accounting policies

Basis of preparation

Great Portland Estates plc is a public company limited by shares incorporated and domiciled in the United Kingdom 
(England and Wales). The address of the registered office is given on page 211. The financial statements have been prepared 
in accordance with IFRSs adopted by the European Union and therefore the Group financial statements comply with Article 4 
of the EU IAS Regulation.

The financial statements have been prepared on the historical cost basis, except for the revaluation of properties and certain 
financial instruments which are held at fair value. The consolidated financial statements, including the results and financial 
position, are expressed in Sterling (£), which is the functional and presentation currency of the Group.

The directors have considered the appropriateness of adopting the going concern basis in preparing the financial statements 
for the year ended 31 March 2020, with particular focus on the significant impact COVID-19 is having on the macro-economic 
conditions in which the Group is operating. This assessment is based on the next 12 months of the Group’s financial forecasts, 
including a going concern scenario which included the following key assumptions:

 – a 35% decline in the valuation of the property portfolio;

 – a twelve-month delay to developments; and

 – an overall decline of around 35% in rental income.

The going concern scenario demonstrates that the Group over the next 12 months:

 – has significant liquidity to fund its ongoing operations;

 – is operating with significant headroom above its Group debt financing covenants;

 – property values would have to fall by a further 41% before breach (or 70% from 31 March 2020 values);

 – due to the measurement of its income related bank covenants, in particular the treatment of capitalised interest, for the 
year ended 31 March 2020, the Group did not have a net interest charge. As a result, its interest cover covenant was not 
measurable. Absent the benefit of capitalised interest, as assumed in the going concern assessment, earnings before 
interest and tax would need to fall by a further 77% before breach (or 90% from 31 March 2020 levels); and 

 – has no debt maturities.

Based on these considerations, together with extensive stress testing, available market information and the directors’ 
knowledge and experience of the Group’s property portfolio and markets, the directors have adopted the going concern basis 
in preparing the accounts for the year ended 31 March 2020.

Significant judgements and sources of estimation uncertainty

In the process of preparing the financial statements, the directors are required to make certain judgements, assumptions and 
estimates. Not all of the Group’s accounting policies require the directors to make difficult, subjective or complex judgements 
or estimates. Any estimates and judgements made are continually evaluated and are based on historical experience and other 
factors, including expectations of future events that are believed to be reasonable under the circumstances. Although these 
estimates are based on the directors’ best knowledge of the amount, event or actions, actual results may differ from 
those estimates. 

No significant judgements have been made.

The following is intended to provide an understanding of the estimates that management consider critical because of the level 
of complexity, judgement or estimation involved in their application and their impact on the financial statements.

Key source of estimation uncertainty: property portfolio valuation

The valuation to assess the fair value of the Group’s investment properties is prepared by its external valuer. The valuation is 
based upon a number of assumptions including future rental income, anticipated maintenance costs, future development 
costs and an appropriate discount rate. The valuers also make reference to market evidence of transaction prices for similar 
properties. An adjustment to any of these assumptions could lead to a material change in the property valuation. For 31 March 
2020, the rapid spread of COVID-19 has disrupted activity in real estate markets creating heightened valuation uncertainty 
for the Group’s valuers. As a result, the valuation report includes a clause which highlights a ‘material valuation uncertainty’. 
This clause serves as a precaution and does not invalidate the valuation and does not mean that the valuation cannot be relied 
upon. Rather, it is intended to highlight that due to current extraordinary circumstances, less certainty can be attached to the 
valuation than would otherwise be the case.

For the current year and prior year the directors adopted the valuation without adjustment, further information is provided in 
the accounting policy for investment property and note 10.

164

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1 Accounting policies continued 

New accounting standards

During the year ended 31 March 2020, the following accounting standards and guidance were adopted by the Group:

 – IFRS 16 Leases (see below);

 – IFRIC 23 Uncertainty over Income Tax Treatments;

 – Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28);

 – Annual Improvements to IFRS Standards 2015–2017 Cycle;

 – Prepayment Features with Negative Compensation (Amendments to IFRS 9); and

 – Plan Amendment, Curtailment or Settlement (Amendments to IAS 19).

The adoption of the Standards and Interpretations has not significantly impacted these financial statements and any changes 
to our accounting policies as a result of their adoption have been reflected in this note.

At the date of approval of these financial statements, the following Standards and Interpretations were in issue but not yet 
effective (and in some cases had not yet been adopted by the EU) and have not been applied in these financial statements:

 – Amendments to References to the Conceptual Framework in IFRS Standards;

 – Definition of a Business (Amendments to IFRS 3);

 – Definition of Material (Amendments to IAS 1 and IAS 8);

 – Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7); and

 – Classification of Liabilities as Current or Non-Current (Amendments to IAS 1).

None of these are expected to have a significant effect on the financial statements of the Group. 

This is the Group’s first set of financial statements where IFRS 16 Leases has been applied. There have been no retrospective 
adjustments made to the prior year figures. The impact on the results on adoption of this standard is set out below:

 – IFRS 16 replaces IAS 17 Leases and requires all operating leases in excess of one year, where the Group is the lessee, to 

be included on the Group’s balance sheet, and recognise a right-of-use asset and a related lease liability representing the 
obligation to make lease payments. The right-of-use asset is assessed for impairment annually (incorporating any onerous 
lease assessments) and amortised on a straight-line basis, with the lease liability being amortised using the effective interest 
method. The accounting for lessors does not significantly change. The Group’s only significant lease commitments relates to 
its head office;

 – the Group has applied IFRS 16 using the modified retrospective approach and has not restated comparative information. 
The transition date of initial application of IFRS 16 for the Group is 1 April 2019. The Group recognised a right of use asset 
of £4.9 million in property, plant and equipment (note 13) and a lease liability of £5.6 million (note 20) at the transition date. 
The impact at transition date on the opening retained earnings is £0.7 million;

 – the impact on the consolidated income statement for the period ended 31 March 2020 is a £0.1 million decrease in 

administration expenses and a £0.1 million increase in finance costs. In the Group statement of cash flows the depreciation 
of the right of use assets of £0.8 million is included in operating profit and the repayment of the lease liability of £0.9 million is 
included in financing activities improving operational cash flows; and

 – in the prior year, operating lease commitments were disclosed under IAS 17 with undiscounted non-cancellable future lease 
payments of £6.1 million at 31 March 2019. After discounting using an incremental borrowing rate of 3.2%, the future lease 
payments under IFRS 16, the liability reduced to £5.6 million. 

The Group’s accounting policies under IFRS 16 are as follows:

Leases – the Group as a lessor

Rent receivable is recognised in the income statement on a straight-line basis over the term of the lease. In the event that a 
lease incentive is granted to a lessee, such incentives are recognised as an asset, with the aggregate cost of the incentive 
recognised as a reduction in rental income on a straight-line basis over the term of the lease.

Leases – the Group as lessee

Where the Group is a lessee, a right of use asset and lease liability are recognised at the outset of the lease. The lease liability is 
initially measured at the present value of the lease payments based on the Group’s expectations of the likelihood of the lease 
term. The lease liability is subsequently adjusted to reflect an imputed finance charge, payments made to the lessor and any 
lease modifications. 

Annual Report 2020  Great Portland Estates 165

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Notes forming part of the Group financial statements continued

1 Accounting policies continued 
The right of use asset is initially measured at cost, which comprises the amount of the lease liability, direct costs incurred, 
less any lease incentives received by the Group. The Group has two categories of right of use assets: those in respect of head 
leases related to its leasehold properties and an occupational lease for its head office. The right of use asset in respect of head 
leases is classified as investment property and is added to the carrying value of the leasehold investment property. The right of 
use asset in respect of its occupational leases is classified as property, plant and equipment and is subsequently depreciated 
over the length of the lease. 

Basis of consolidation 

The Group’s financial statements consolidate the financial statements of the Company and all its subsidiary undertakings for 
the year ended 31 March 2020. Subsidiary undertakings are those entities controlled by the Group. Control exists when the 
Company is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those 
returns through its power over the investee.

Rental income 

This comprises rental income and premiums on lease surrenders on investment properties for the year, exclusive of service 
charges receivable. 

Lease incentives 

Lease incentives, including rent-free periods and payments to occupiers, are allocated to the income statement on a straight-
line basis over the lease term or on another systematic basis, if applicable. The value of resulting accrued rental income is 
included within the respective property.

Other property expenses 

Irrecoverable running costs directly attributable to specific properties within the Group’s portfolio are charged to the income 
statement as other property expenses. Costs incurred in the improvement of the portfolio which, in the opinion of the 
directors, are not of a capital nature are written-off to the income statement as incurred.

Administration expenses 

Costs not directly attributable to individual properties are treated as administration expenses.

Share-based payment 

The cost of granting share-based payments to employees and directors is recognised within administration expenses in the 
income statement. The Group has used the Stochastic model to value the grants, which is dependent upon factors including 
the share price, expected volatility and vesting period, and the resulting fair value is amortised through the income statement 
over the vesting period. The charge is recognised over the vesting period and reversed if it is likely that any non-market-based 
performance or service criteria will not be met.

Segmental analysis

The directors are required to present the Group’s financial information by business segment or geographical area. 
This requires a review of the Group’s organisational structure and internal reporting system to identify reportable segments 
and an assessment of where the Group’s assets or customers are located. 

All of the Group’s revenue is generated from investment and trading properties located in central London. The properties 
are managed as a single portfolio by a portfolio management team whose responsibilities are not segregated by location 
or type, but are managed on an asset-by-asset basis. The majority of the Group’s assets are mixed-use, therefore the office, 
retail and any residential space is managed together. Within the property portfolio, the Group has a number of properties 
under development. The directors view the Group’s development activities as an integral part of the life cycle of each of its 
assets rather than a separate business or division. The nature of developing property means that whilst a property is under 
development it generates no revenue and has no operating results. Once a development has completed, it returns to the 
investment property portfolio, or if it is a trading property, it is sold. The directors have considered the nature of the business, 
how the business is managed and how they review performance and, in their judgement, the Group has only one reportable 
segment. The components of the valuation, as provided by the external valuer, are set out in note 10. 

Investment property 

Both leasehold and freehold investment properties and investment properties under development are professionally valued 
on a fair value basis by qualified external valuers and the directors must ensure that they are satisfied that the valuation of the 
Group’s properties is appropriate for inclusion in the accounts without adjustment.

The valuations have been prepared in accordance the RICS Valuation – Global Standards 2017 (incorporating the International 
Valuation Standards) and the UK national supplement 2018 (the Red Book) and have been primarily derived using comparable 
recent market transactions on arm’s length terms.

166

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1 Accounting policies continued 
For investment property, this approach involves applying market-derived capitalisation yields to current and market-derived 
future income streams with appropriate adjustments for income voids arising from vacancies or rent-free periods. 

These capitalisation yields and future income streams are derived from comparable property and leasing transactions and 
are considered to be the key inputs in the valuation. Other factors that are taken into account in the valuations include the 
tenure of the property, tenancy details, non-payment of rent, planning, building and environmental factors that might affect 
the property.

In the case of investment property under development, the approach applied is the ‘residual method’ of valuation, which is the 
investment method of valuation as described above with a deduction for the costs necessary to complete the development, 
together with an allowance for the remaining risk.

The Group recognises sales and purchases of property when control passes on completion of the contract. Gains or losses on 
the sale of properties are calculated by reference to the carrying value at the end of the previous year, adjusted for subsequent 
capital expenditure. 

Trading property 

Trading property is being developed for sale or being held for sale after development is complete, and is carried at the 
lower of cost and net realisable value. Revenue is recognised on completion of disposal. Cost includes direct expenditure 
and capitalised interest. Cost of sales, including costs associated with off-plan residential sales, are expensed to the income 
statement as incurred.

Depreciation 

No depreciation is provided in respect of freehold investment properties and leasehold investment properties. Plant and 
equipment is held at cost less accumulated depreciation. Depreciation is provided on plant and equipment, at rates calculated 
to write off the cost, less residual value prevailing at the balance sheet date of each asset evenly over its expected useful life, 
as follows:

Fixtures and fittings – over three to five years.

Leasehold improvements – over the term of the lease. 

Joint ventures 

Joint ventures are accounted for under the equity method where, in the directors’ judgement, the Group has joint control 
of the entity. The Group’s level of control in its joint ventures is driven both by the individual agreements which set out how 
control is shared by the partners and how that control is exercised in practice. The Group balance sheet contains the Group’s 
share of the net assets of its joint ventures. Balances with partners owed to or from the Group by joint ventures are included 
within investments. The Group’s share of joint venture profits and losses are included in the Group income statement in a 
single line. All of the Group’s joint ventures adopt the accounting policies of the Group for inclusion in the Group financial 
statements. There have been no new joint ventures during the year and no changes to any of the agreements in place.

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Income tax 

Current tax is the amount payable on the taxable income for the year and any adjustment in respect of previous years. 
Deferred tax is provided in full on temporary differences between the tax base of an asset or liability and its carrying amount in 
the balance sheet. Deferred tax is determined using tax rates that have been enacted or substantively enacted by the balance 
sheet date and are expected to apply when the asset is realised or the liability is settled. Deferred tax assets are recognised 
when it is probable that taxable profits will be available against which the deferred tax assets can be utilised. No provision 
is made for temporary differences arising on the initial recognition of assets or liabilities that affect neither accounting 
nor taxable profit. Tax is included in the income statement except when it relates to items recognised directly in other 
comprehensive income or equity, in which case the related tax is also recognised directly in other comprehensive income 
or equity.

Pension benefits

The Group contributes to a defined benefit pension plan which is funded with assets held separately from those of the Group. 
The full value of the net assets or liabilities of the pension fund is brought on to the balance sheet at each balance sheet date. 
Actuarial gains and losses are taken to other comprehensive income; all other movements are taken to the income statement.

Capitalisation of interest

Interest associated with direct expenditure on investment and trading properties under development is capitalised. 
Direct expenditure includes the purchase cost of a site if it has been purchased with the specific intention to redevelop, 
but does not include the original book cost of a site where no intention existed. Interest is capitalised from the start of the 
development work until the date of practical completion. The rate used is the Group’s weighted average cost of borrowings 
or, if appropriate, the rate on specific associated borrowings.

Annual Report 2020  Great Portland Estates 167

 
Notes forming part of the Group financial statements continued

1 Accounting policies continued

Other investments

Other investments comprise investments in Pi Labs European PropTech venture capital fund which is measured at fair value, 
based on the net assets of the fund, this is a Level 2 valuation as defined by IFRS 13. Changes in fair value are recognised in 
profit or loss. 

Financial instruments

i Derivatives The Group may use derivative financial instruments to hedge its exposure to foreign currency fluctuations and 
interest rate risks. The Group’s derivatives are measured at fair value in the balance sheet. Derivatives are initially recognised at 
fair value at the date a derivative contract is entered into. At 31 March 2020, the Group had no derivatives.

ii Borrowings The Group’s borrowings in the form of its debentures, private placement notes and bank loans are recognised 
initially at fair value, after taking account of any discount or premium on issue and attributable transaction costs. Subsequently, 
borrowings are held at amortised cost, with any discounts, premiums and attributable costs charged to the income statement 
using the effective interest rate method.

iii Convertible bond The Group’s convertible bond could be settled in shares, cash or a combination of both at the Group’s 
discretion. The bonds were designated at fair value through profit and loss upon initial recognition, with any gains or losses 
arising subsequently due to re-measurement being recognised in the income statement. The convertible bonds matured in 
the prior year.

iv Cash and cash equivalents Cash and cash equivalents comprise cash in hand, demand deposits and other short-term highly 
liquid investments that are readily convertible into a known amount of cash and are subject to insignificant risk of changes 
in value.

v Trade receivables and payables Trade receivables and payables are initially measured at fair value, and are subsequently 
measured at amortised cost using the effective interest rate method.

2 Total revenue

Gross rental income
Spreading of tenant lease incentives
Service charge income
Joint venture fee income
Trading property revenue

3 Net rental income

Gross rental income
Spreading of tenant lease incentives
Ground rents

4 Property expenses

Service charge income
Service charge expenses
Other property expenses

168

Great Portland Estates  Annual Report 2020

2020 
£m

80.7
0.3
12.9
2.1
6.4
102.4

2020 
£m

80.7
0.3
(1.1)
79.9

2020 
£m

(12.9)
14.8
6.2
8.1

2019 
£m

82.9
(1.6)
12.9
3.8
14.4
112.4

2019 
£m

82.9
(1.6)
(1.0)
80.3

2019 
£m

(12.9)
15.1
9.7
11.9

5 Administration expenses

Employee costs
Operating leases
Depreciation
Other head office costs

2020 
£m

20.5
–
1.5
7.0
29.0

2019 
£m

17.2
1.0
0.8
6.1
25.1

Included within employee costs is an accounting charge for the LTIP scheme of £2.6 million (2019: £1.3 million). Employee costs, 
including those of directors, comprise the following:

Wages and salaries (including annual bonuses)
Share-based payments
Social security costs
Other pension costs

Less: recovered through service charges
Less: capitalised into development projects

Key management compensation

2020 
£m

15.7
2.6
2.6
1.6
22.5
(1.2)
(0.8)
20.5

2019 
£m

14.0
1.3
2.3
1.6
19.2
(1.5)
(0.5)
17.2

The emoluments and pension benefits of the directors are set out in detail within the Directors’ remuneration report on pages 
126 to 154. The directors and the Executive Committee are considered to be key management for the purposes of IAS 24 
‘Related Party Transactions’ with their aggregate compensation set out below: 

Wages and salaries (including annual bonuses)
Share-based payments
Social security costs
Other pension costs

2020 
£m

4.0
0.9
0.6
0.4
5.9

2019 
£m

3.3
0.4
0.5
0.4
4.6

The Group had loans to key management of £6,026 outstanding at 31 March 2020. The Group’s key management, its pension 
plan and joint ventures are the Group’s only related parties.

Employee information

The average number of employees of the Group, including directors, was:

Head office and property management

Auditor’s remuneration

Audit of the Company’s annual accounts
Audit of subsidiaries

Audit-related assurance services, including the interim review
Total audit and audit-related services
Other services

2020 
Number

114

2019 
Number

110

2020 
£000’s

2019 
£000’s

171
100
271
77
348
–
348

123
102
225
75
300
–
300

Annual Report 2020  Great Portland Estates 169

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Notes forming part of the Group financial statements continued

6 Finance income

Interest on balances with joint ventures
Interest on cash deposits

7 Finance costs

Interest on revolving credit facilities
Interest on private placement notes
Interest on debenture stock 
Interest on convertible bond
Interest on obligations under occupational leases
Interest on obligations under head leases
Gross finance costs
Less: capitalised interest at an average rate of 3.1% (2019: 3.2%)

8 Tax

Current tax
UK corporation tax
Tax (over provided)/under provided in previous years
Total current tax
Deferred tax
Tax (credit)/charge for the year

2020 
£m

6.9
0.4
7.3

2020 
£m

2.3
6.8
1.2
–
0.1
1.9
12.3
(5.8)
6.5

2020 
£m

–
(0.2)
(0.2)
–
(0.2)

The difference between the standard rate of tax and the effective rate of tax arises from the items set out below:

Profit before tax
Tax charge on profit at standard rate of 19% (2019: 19%)
REIT tax-exempt rental profits and gains
Changes in fair value of properties not subject to tax
Changes in fair value of financial instruments not subject to tax
Prior periods’ corporation tax
Gains in respect of sales of investment properties subject to tax
Gains in respect of £150 million 1% convertible bonds 2018
Other
Tax (credit)/charge for the year

2020 
£m

51.6
9.8
(13.5)
2.3
–
(0.2)
–
–
1.4
(0.2)

2019 
£m

7.1
1.2
8.3

2019  
£m

3.0
6.2
1.2
0.6
–
1.9
12.9
(4.8)
8.1

2019 
£m

8.1
0.1
8.2
(1.6)
6.6

2019 
£m

56.1
10.7
(9.8)
(1.4)
(0.2)
0.1
6.8
2.8
(2.4)
6.6

During the year, £nil million of deferred tax was credited directly to equity (2019: £0.2 million). The Group’s net deferred tax 
asset at 31 March 2020 was £nil (2019: £nil) consisting of a deferred tax liability of £0.1 million (2019: £0.1 million) and a deferred 
tax asset of £0.1 million (2019: £0.1 million). 

170

Great Portland Estates  Annual Report 2020

8 Tax continued

Movement in deferred tax 

At 1 April 
2019
£m

Recognised in 
the income 
statement
£m

Recognised in 
equity
 £m

At 31 March 
2020
£m

Net deferred tax asset/(liability) in respect of other timing differences

–

–

–

–

A deferred tax asset of £3.7 million (2019: £2.5 million), mainly relating to revenue losses and contingent share awards was 
not recognised because it is uncertain whether future taxable profits will arise against which this asset can be utilised.

As a REIT, the Group is largely exempt from corporation tax in respect of its rental profits and chargeable gains relating to its 
property rental business. The Group is otherwise subject to corporation tax. In particular, the Group’s REIT exemption does 
not extend to either profits arising from the sale of trading properties or profits arising from the sale of investment properties 
in respect of which a major redevelopment has completed within the preceding three years. 

In order to ensure that the Group is able to both retain its status as a REIT and to avoid financial charges being imposed, 
a number of tests (including a minimum distribution test) must be met by both Great Portland Estates plc and by the 
Group as a whole on an ongoing basis. These conditions are detailed in the Corporation Tax Act 2010.

Additionally, during August 2019, HMRC published new guidance which states that it considers that the REIT exemption also 
does not extend to profits arising from the sale of investment properties which are undergoing a major redevelopment at 
the time of sale. The Group will continue to consider its potential effect of this guidance on any recent and future sales by 
the Group.

9 Alternative performance measures and EPRA metrics
Adjusted earnings and net assets per share are calculated in accordance with the Best Practice Recommendations issued by 
the European Public Real Estate Association (EPRA). The recommendations are designed to make the financial statements 
of public real estate companies clearer and more comparable across Europe, enhancing the transparency and coherence of 
the sector. The directors consider these EPRA metrics, and the other metrics provided, to be the most appropriate method of 
reporting the value and performance of the business.

Weighted average number of ordinary shares

Issued ordinary share capital at 1 April
Share buyback
Investment in own shares
Weighted average number of ordinary shares at 31 March – Basic

Basic and diluted earnings per share

2020 
Number of 
shares

2019 
Number of 
shares

271,365,894
(11,864,663)
(1,109,303)
258,391,928

281,663,675
(4,608,662)
(1,122,294)
275,932,719

Basic
Dilutive effect of convertible bond
Dilutive effect of LTIP shares
Diluted

Profit 
after tax 
2020 
£m

Number 
of shares 
2020 
million

Profit 
per share 
2020 
pence

Profit 
after tax 
2019 
£m

Number 
of shares 
2019 
million

Profit 
per share 
2019 
pence

51.8
–
–
51.8

258.4
–
0.8
259.2

20.0
–
–
20.0

49.5
(0.7)
–
48.8

275.9
8.7
0.4
285.0

17.9
(0.8)
–
17.1

Annual Report 2020  Great Portland Estates 171

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Notes forming part of the Group financial statements continued

9 Alternative performance measures and EPRA metrics continued

Basic and diluted EPRA earnings per share

Profit 
after tax 
2020 
£m

Number 
of shares 
2020 
million

Earnings 
per share 
2020 
pence

Profit 
after tax 
2019 
£m

Number 
of shares 
2019 
million

Earnings 
per share 
2019 
pence

Basic
Deficit/(surplus) from investment property net of tax (note 10)
Surplus from joint venture investment property (note 12)
Movement in fair value of convertible bond net of tax
Movement in fair value of derivatives in joint ventures  
(note 12)
(Profit)/loss on sale of trading property net of tax
Deferred tax (note 8)
Basic EPRA earnings
Dilutive effect of LTIP shares
Diluted EPRA earnings

51.8
52.6
(46.6)
–

–
(0.8)
–
57.0
–
57.0

258.4
–
–
–

–
–
–
258.4
0.8
259.2

20.0
20.3
(18.0)
–

–
(0.3)
–
22.0
–
22.0

49.5
(1.4)
(3.4)
1.0

0.1
9.5
(1.6)
53.7
–
53.7

275.9
–
–
–

–
–
–
275.9
0.4
276.3

17.9
(0.5)
(1.2)
0.4

–
3.5
(0.6)
19.5
(0.1)
19.4

EPRA net assets per share

Basic net assets
Investment in own shares
Dilutive effect of LTIP shares
Diluted net assets
Fair value of derivatives in joint ventures (note 12)
Deferred tax (note 8)
EPRA NAV
Fair value of financial liabilities (note 17)
Fair value of financial liabilities in joint ventures (note 12)
Fair value of derivatives in joint ventures (note 12)
Deferred tax (note 8)
EPRA NNNAV

Net assets 
2020 
£m

2,203.1
–
–
2,203.1
–
–
2,203.1
9.8
(1.4)
–
–
2,211.5

Number  
of shares 
2020 
million

Net assets 
per share 
2020 
pence

Net assets 
2019 
£m

Number 
of shares 
2019 
million

Net assets 
per share 
2019 
pence

253.9
(1.1)
1.0
253.8
–
–
253.8
–
–
–
–
253.8

868
4
(4)
868
–
–
868
4
(1)
–
–
871

2,309.7
–
–
2,309.7
0.4
–
2,310.1
(7.2)
(1.0)
(0.4)
–
2,301.5

271.4
(1.1)
0.5
270.8
–
–
270.8
–
–
–
–
270.8

851
4
(2)
853
–
–
853
(3)
–
–
–
850

172

Great Portland Estates  Annual Report 2020

9 Alternative performance measures and EPRA metrics continued

EPRA cost ratio (including share of joint ventures)

Administration expenses
Property expenses
Joint venture management fee income
Joint venture property and administration costs
EPRA costs (including direct vacancy costs) (A)
Direct vacancy costs
Joint venture direct vacancy cost
EPRA costs (excluding direct vacancy costs) (B)

Net rental income 
Joint venture net rental income
Gross rental income (C)

Portfolio at fair value including joint ventures (D)

Cost ratio (including direct vacancy costs) (A/C)
Cost ratio (excluding direct vacancy costs) (B/C)
Cost ratio (by portfolio value) (A/D)

EPRA capital expenditure is included in note 10.

Net debt and loan-to-property value

£142.9 million 55⁄8% debenture stock 2029
£450.0 million revolving credit facility
Private placement notes
Less: cash balances
Net debt excluding joint ventures
Joint venture bank loans (at share)
Less: joint venture cash balances (at share)
Net debt including joint ventures (A)

Group properties at market value
Joint venture properties at market value
Properties at fair value including joint ventures (B)

Loan-to-property value (A/B)

Total accounting return

Opening EPRA NAV (A)
Closing EPRA NAV 
Increase in EPRA NAV
Ordinary dividends paid in the year
Total return (B)

Total accounting return (B/A)

2020 
£m

29.0
8.1
(2.1)
1.7
36.7
(3.8)
(0.4)
32.5

79.9
17.9
97.8

2019
£m

25.1
11.9
(3.8)
2.4
35.6
(6.1)
(0.4)
29.1

80.3
15.7
96.0

2,624.1

2,579.0

37.5%
33.2%
1.4%

37.1%
30.3%
1.4%

2020 
£m

22.0
148.1
274.2
(94.9)
349.4
39.9
(16.0)
373.3

2019
£m

22.0
–
274.0
(139.4)
156.6
84.8
(17.4)
224.0

1,946.4
677.7
2,624.1

1,989.9
589.1
2,579.0

14.2%

8.7%

2020 
Pence per 
share

2019 
Pence per  
share 

853.0
868.0
15.0
12.6
27.6

845.0
853.0
8.0
11.6
19.6

3.2%

2.3%

Annual Report 2020  Great Portland Estates 173

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Notes forming part of the Group financial statements continued

9 Alternative performance measures and EPRA metrics continued

Cash earnings per share

Profit 
after tax 
2020 
£m

Number 
of shares 
2020 
million

Earnings 
per share 
2020 
pence

Profit 
after tax 
2019 
£m

Number 
of shares 
2019 
million

Earnings 
per share 
2019 
pence

57.0
(5.8)
(4.4)
(0.3)
(2.7)

2.6
46.4

259.2
–
–
–
–

–
259.2

22.0
(2.2)
(1.7)
(0.1)
(1.1)

1.0
17.9

53.7
(4.8)
(3.5)
1.6
(1.0)

1.3
47.3

276.3
–
–
–
–

–
276.3

19.4
(1.7)
(1.3)
0.6
(0.4)

0.5
17.1

Diluted EPRA earnings
Capitalised interest
Capitalised interest in joint ventures
Spreading of tenant lease incentives
Spreading of tenant lease incentives in joint ventures

Employee Long-Term Incentive Plan charge
Cash earnings per share

10 Investment property

Investment property

Book value at 1 April 2018
Costs capitalised
Disposals
Net valuation surplus/(deficit) on investment property
Book value at 31 March 2019
Costs capitalised
Disposals
Net valuation deficit on investment property
Book value at 31 March 2020

Investment property under development

Book value at 1 April 2018
Costs capitalised
Interest capitalised
Net revaluation surplus on investment property under development
Book value at 31 March 2019
Costs capitalised
Interest capitalised
Net valuation deficit on investment property under development
Book value at 31 March 2020

Freehold
£m

Leasehold
£m

1,059.6
7.0
(336.6)
3.5
733.5
11.8
(56.9)
(22.4)
666.0

1,083.1
2.2
–
(4.2)
1,081.1
11.8
–
(23.3)
1,069.6

Freehold
£m

Leasehold
£m

162.5
38.8
4.8
4.3
210.4
48.1
5.8
(12.8)
251.5

–
–
–
–
–
–
–
–
–

Total
£m

2,142.7
9.2
(336.6)
(0.7)
1,814.6
23.6
(56.9)
(45.7)
1,735.6

Total
£m

162.5
38.8
4.8
4.3
210.4
48.1
5.8
(12.8)
251.5

Total investment property

917.5

1,069.6

1,987.1

The book value of investment property includes £40.7 million (2019: £40.7 million) in respect of the present value of future 
ground rents. The market value of the portfolio (excluding these amounts) is £1,946.4 million. The market value of the Group’s 
total property portfolio, including trading properties, was £1,946.4 million (2019: £1,989.9 million). The total portfolio value 
including joint venture properties of £677.7 million (see note 12) was £2,624.1 million. At 31 March 2020, property with a carrying 
value of £112.6 million (2019: £108.4 million) was secured under the first mortgage debenture stock (see note 17). 

Surplus from investment property

Net valuation (deficit)/surplus on investment property
Profit on sale of investment properties

174

Great Portland Estates  Annual Report 2020

2020 
£m

(58.5)
5.9
(52.6)

2019
£m

3.6
3.7
7.3

10 Investment property continued
The Group’s investment properties, including those held in joint ventures (note 12), were valued on the basis of Fair Value by 
CBRE Limited (CBRE), external valuers, as at 31 March 2020. The valuations have been prepared in accordance with the RICS 
Valuation – Global Standards 2017 (incorporating the International Valuation Standards) and the UK national supplement 2018 
(the Red Book) and have been primarily derived using comparable recent market transactions on arm’s length terms. 

For the 31 March 2020 valuation, the rapid spread of COVID-19 has disrupted activity in real estate markets creating 
heightened valuation uncertainty for the Group’s valuers. As a result, the valuation report includes a clause which highlights 
a ‘material valuation uncertainty’ which is as follows:

“As at the valuation date, we consider that we can attach less weight to previous market evidence for comparison purposes, 
to inform opinions of value. Indeed, the current response to COVID-19 means that we are faced with an unprecedented 
set of circumstances on which to base a judgement. Our valuation is therefore reported on the basis of ‘material valuation 
uncertainty’ as set out in VPS 3 and VPGA 10 of the RICS Valuation – Global Standards. Consequently, less certainty – and a 
higher degree of caution – should be attached to our valuation than would normally be the case. Given the unknown future 
impact that COVID-19 might have on the real estate market, we recommend that you keep the valuation of this portfolio 
under frequent review.”

This clause serves as a precaution and does not invalidate the valuation, and does not mean that the valuation cannot be relied 
upon. Rather, it is intended to highlight that due to current extraordinary circumstances, less certainty can be attached to the 
valuation than would otherwise be the case.

The total fees, including the fixed fee for this assignment, earned by CBRE (or other companies forming part of the same 
group of companies within the UK) from the Group are less than 5.0% of total UK revenues. The valuation at 31 March 2019 was 
the first year for a new principal signatory of the CBRE valuation reports. CBRE has continuously been carrying out valuation 
instructions for the Group for in excess of 20 years. CBRE has carried out valuation, agency and professional services on behalf 
of the Group for in excess of 20 years.

Real estate valuations are complex and derived using comparable market transactions which are not publicly available and involve 
an element of judgement. Therefore, in line with EPRA guidance, we have classified the valuation of the property portfolio as Level 
3 as defined by IFRS 13. There were no transfers between levels during the year. Inputs to the valuation, including capitalisation 
yields (typically the true equivalent yield) and rental values, are defined as ‘unobservable’ as defined by IFRS 13. 

Key inputs to the valuation

North of Oxford Street

Rest of West End

City, Midtown and Southwark

 ERV

True equivalent yield

Average  

£ per sq ft

Range  

£ per sq ft

Average 
%

75
77

81
120
56
77

46 – 92
32 – 147

60 – 93
14 – 335
46 – 64
33 – 111

4.5
4.2

4.8
4.1
5.1
4.6

Range 
%

4.1 – 6.8
3.6 – 6.7

3.6 – 6.2
3.1 – 6.2
4.4 – 5.6
4.4 – 4.9

Office
Retail

Office
Retail
Office
Retail

Everything else being equal, there is a positive relationship between rental values and the property valuation, such that an 
increase in rental values will increase the valuation of a property and a decrease in rental values will reduce the valuation of 
the property. Any percentage movement in rental values will translate into approximately the same percentage movement 
in the property valuation. However, due to the long-term nature of leases, where the passing rent is fixed and often 
subject to upwards only rent reviews, the impact will not be immediate and will be recognised over a number of years. 
The relationship between capitalisation yields and the property valuation is negative and more immediate; therefore an 
increase in capitalisation yields will reduce the valuation of a property and a reduction will increase its valuation. A decrease 
in the capitalisation yield by 25 basis points would result in an increase in the fair value of the Group’s investment property 
by £149.2 million, whilst a 25 basis point increase would reduce the fair value by £134.0 million. There are interrelationships 
between these inputs as they are determined by market conditions, and the valuation movement in any one period depends 
on the balance between them. If these inputs move in opposite directions (i.e. rental values increase and yields decrease) 
valuation movements can be amplified, whereas if they move in the same direction they may offset, reducing the overall 
net valuation movement. Additionally, investment property under development is sensitive to estimated income, cost and 
developer’s profit assumptions included in the valuations.

At 31 March 2020, the Group had capital commitments of £57.5 million (2019: £93.6 million). For further detail see Our 
development activities on pages 34 to 38.

Annual Report 2020  Great Portland Estates 175

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Notes forming part of the Group financial statements continued

10 Investment property continued

EPRA capital expenditure

Group
Acquisitions
Developments (including trading properties)
Investment property
Interest capitalised (including trading properties)
Joint ventures (at share)
Developments
Investment property
Interest capitalised
Total

See note 9 for further detail on EPRA measures.

11 Trading property

At 1 April 
Disposals
At 31 March 

2020 
£m

–
48.1
23.6
5.8

34.1
0.7
4.4
116.7

2020
£m

5.6
(5.6)
–

2019
£m

–
38.8
9.2
4.8

70.5
5.8
3.5
132.6

2019
£m

19.5
(13.9)
5.6

The Group has developed a large mixed-use scheme at Rathbone Square, W1. Part of the approved scheme consisted of 
residential units which the Group held for sale. As a result, the residential element of the scheme was classified as trading 
property. During the year, the final residential unit was sold for £5.6 million. 

12 Investment in joint ventures
The Group has the following investments in joint ventures:

At 1 April 
Movement on joint venture balances
Additions
Share of profit of joint ventures
Share of revaluation surplus of joint ventures
Share of loss on disposal of joint venture properties 
Share of results of joint ventures
Distributions
At 31 March 

Equity 
£m

329.1
–
18.0
11.3
46.6
–
57.9
(4.6)
400.4

Balances  
with  
partners 
£m

182.8
63.8
–
–
–
–
–
–
246.6

2020 
Total 
£m

511.9
63.8
18.0
11.3
46.6
–
57.9
(4.6)
647.0

2019 
Total 
£m

423.7
42.7
45.6
6.6
3.5
(0.1)
10.0
(10.1)
511.9

All of the Group’s joint ventures operate solely in the United Kingdom and comprise the following:

The GHS Limited Partnership
The Great Capital Partnership (inactive)
The Great Ropemaker Partnership 
The Great Victoria Partnerships 
The Great Wigmore Partnership (inactive)

Country of registration

Jersey
United Kingdom
United Kingdom
United Kingdom
United Kingdom

2020 
ownership

2019  
ownership

50%
50%
50%
50%
50%

50%
50%
50%
50%
50%

176

Great Portland Estates  Annual Report 2020

12 Investment in joint ventures continued
The Group’s share in the assets and liabilities, revenues and expenses for the joint ventures is set out below:

Balance sheets
Investment property
Current assets
Cash
Balances (from)/to partners
Bank loans
Derivatives
Current liabilities
Finance leases
Net assets

Income statements
Net rental income
Property and administration costs
Net finance costs
Movement in fair value of derivatives
Profit/(loss) from joint ventures
Revaluation of investment property
Loss on sale of investment property

Share of results of joint ventures

The GHS 
Limited 
Partnership  

The Great 
Ropemaker 
Partnership  

£m

£m

The Great
Victoria
Partnerships
£m

Other  
£m

2020 
Total 
£m

2020
At share
£m

2019 
 At share
£m

677.5
1.3
13.2
(208.6)
–
–
(8.3)
–
475.1

541.3
5.1
8.3
(295.6)
–
–
(9.8)
(10.3)
239.0

147.0
0.8
10.4
10.9
(79.8)
–
(2.5)
–
86.8

–
–
–
–
–
–
(0.1)
–
(0.1)

1,365.8
7.2
31.9
(493.3)
(79.8)
–
(20.7)
(10.3)
800.8

682.9
3.6
16.0
(246.6)
(39.9)
–
(10.4)
(5.2)
400.4

594.3
2.4
17.4
(182.8)
(84.8)
(0.4)
(11.8)
(5.2)
329.1

The GHS 
Limited 
Partnership  

The Great 
Ropemaker 
Partnership  

£m

£m

The Great
Victoria
Partnerships
£m

Other  
£m

2020 
Total 
£m

2020
At share
£m

2019 
 At share
£m

–
(0.6)
0.1
–
(0.5)
150.2
–

149.7

24.4
(2.5)
(6.9)
–
15.0
(4.8)
–

10.2

11.5
(0.2)
(3.0)
–
8.3
(52.2)
–

(43.9)

–
(0.1)
–
–
(0.1)
–
–

(0.1)

35.9
(3.4)
(9.8)
–
22.7
93.2
–

115.9

17.9
(1.7)
(4.9)
–
11.3
46.6
–

57.9

15.7
(2.4)
(6.6)
(0.1)
6.6
3.5
(0.1)

10.0

The non-recourse debt facilities of the joint ventures at 31 March 2020 are set out below:

Joint venture debt facilities

The Great Victoria Partnership

Nominal value 
(100%) 
£m

Maturity Fixed/floating

80.0

July 2022

Fixed

Interest rate

3.74%

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At 31 March 2020, the Great Victoria Partnership loan had a fair value of £82.6 million (2019: £81.8 million). During the year, the 
£90.0 million bank loan facility in the Great Ropemaker Partnership was repaid in full. All interest-bearing loans are in sterling. 
At 31 March 2020, the joint ventures had £nil undrawn facilities (2019: £nil).

Transactions during the year between the Group and its joint ventures, which are related parties, are disclosed below:

Movement on joint venture balances during the year
Balances receivable at the year end from joint ventures
Distributions
Management fee income

2020 
£m

(63.8)
(246.6)
4.6
2.1

2019
£m

(42.7)
(182.8)
10.1
3.8

The joint venture balances are repayable on demand and bear interest as follows: the GHS Limited Partnership at 5.3% on 
balances at inception and 4.0% on any subsequent balances and the Great Ropemaker Partnership at 2.0%. 

The investment properties include £5.2 million (2019: £5.2 million) in respect of the present value of future ground rents, net of 
these amounts the market value of our share of the total joint venture properties is £677.7 million. The Group earns fee income 
from its joint ventures for the provision of management services. All of the above transactions are made on terms equivalent 
to those that prevail in arm’s length transactions. 

At 31 March 2020, the Group had £nil contingent liabilities arising in its joint ventures (2019: £nil). At 31 March 2020, the Group 
had capital commitments in respect of its joint ventures of £13.4 million (2019: £45.9 million).

Annual Report 2020  Great Portland Estates 177

 
Notes forming part of the Group financial statements continued

13 Property, plant and equipment

Cost 
At 1 April 2018
Costs capitalised
At 31 March 2019
Adoption of IFRS 16
Costs capitalised
At 31 March 2020
Depreciation
At 1 April 2019
Charge for the year
At 31 March 2020
Carrying amount at 31 March 2019
Carrying amount at 31 March 2020

14 Other investments

At 1 April 
Acquisitions
At 31 March 

Right of use
asset for
occupational
leases
£m

Leasehold 
improvements 
£m

–
–
–
4.9
–
4.9

–
0.8
0.8
–
4.1

5.5
0.1
5.6
–
–
5.6

1.8
0.6
2.4
3.8
3.2

Fixtures and 
fittings/other  

£m

1.1
–
1.1
–
0.1
1.2

0.9
0.1
1.0
0.2
0.2

2020
£m

–
0.2
0.2

Total
£m

6.6
0.1
6.7
4.9
0.1
11.7

2.7
1.5
4.2
4.0
7.5

2019
£m

–
–
–

In January 2020, the Group entered into a commitment of up to £5 million to invest in Pi Labs European PropTech venture 
capital fund. At 31 March 2020, the Group had made investments of £0.2 million. Launched in 2014, Pi Labs is Europe’s longest 
standing PropTech VC and this third fund has a primary focus to invest in early stage PropTech start-ups across Europe and the 
UK that use technology solutions to enhance any stage of the real estate value chain. Key areas of focus for the fund include 
sustainability, future of work, future of retail, commercial real estate technologies, construction technology and smart cities. 

15 Trade and other receivables

Trade receivables
Expected credit loss allowance

Prepayments and accrued income
Amounts due on development management contracts
Other trade receivables

2020 
£m

11.8
(2.2)
9.6
1.0
1.4
4.1
16.1

2019
£m

3.6
(0.7)
2.9
0.6
1.4
6.0
10.9

178

Great Portland Estates  Annual Report 2020

15 Trade and other receivables continued
Trade receivables consist of rent and service charge monies, which are due on the quarter day with no credit period. Interest is 
charged on trade receivables in accordance with the terms of the occupier’s lease. Trade receivables are provided for based 
on the expected credit loss, which uses a lifetime expected loss allowance for all trade receivables based on an assessment 
of each individual occupier’s circumstance. This assessment reviews the outstanding balances of each individual occupier and 
makes an assessment of the likelihood of recovery, based on an evaluation of their financial situation. Where the expected 
credit loss relates to revenue already recognised this has been recognised immediately in the income statement. For the 
portion of the expected credit loss that relates to future revenue which is no longer considered fully recoverable, the relevant 
amount of rent received in advance has been released. 

Debtors past due but not impaired were £0.6 million (2019: £1.9 million) of which £0.6 million (2019: £1.8 million) is over 30 days.

Movements in expected credit loss allowance
Balance at the beginning of the year
Expected credit loss allowance during the year
Expected credit loss allowance in respect of future years
Amounts written-off as uncollectable

16 Trade and other payables

Rents received in advance
Deposits received on forward sale of residential units 
Other payables and accrued expenses

17 Interest-bearing loans and borrowings

Non-current liabilities at amortised cost
Secured 
£142.9 million 55⁄8% debenture stock 2029
Unsecured 
£450.0 million revolving credit facility
£175.0 million 2.15% private placement notes 2024
£40.0 million 2.70% private placement notes 2028
£30.0 million 2.79% private placement notes 2030
£30.0 million 2.93% private placement notes 2033
Non-current interest-bearing loans and borrowings

2020 
£m

(0.7)
(0.1)
(2.1)
0.7
(2.2)

2020 
£m

19.4
0.3
40.3
60.0

2020 
£m

2019
£m

(0.4)
(0.3)
–
–
(0.7)

2019
£m

19.7
1.9
25.5
47.1

2019
£m

22.0

22.0

148.1
174.5
39.9
29.9
29.9
444.3

–
174.4
39.8
29.9
29.9
296.0

In January 2020, the Group entered into an ‘Amendment and Extension’ transaction on its £450 million unsecured revolving 
credit facility (RCF). The size of the RCF is unchanged at £450 million, but the headline margin was reduced to 90.0 basis points 
over LIBOR (plus or minus 2.5 basis points subject to a number of ESG-linked targets) with the maturity extended to January 
2025 which can potentially be extended further to January 2027, subject to bank consent. 

At 31 March 2020, the Group had £301.0 million (2019: £451.0 million) of undrawn credit facilities.

Annual Report 2020  Great Portland Estates 179

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Notes forming part of the Group financial statements continued

18 Financial instruments

Categories of financial instrument

Other investments
Assets at fair value

Convertible bond 
Current liabilities at fair value

Balances with partners
Trade receivables 
Cash and cash equivalents 
Loans and receivables 

Trade and other payables 
Interest-bearing loans and borrowings 
Obligations under occupational leases
Obligations under finance leases 
Liabilities at amortised cost 
Total financial instruments

Financial risk management objectives

Credit risk

Amounts 
recognised in 
income 
statement 
2020 
£m

Carrying 
amount 
2020 
£m

Gain/(loss) 
to equity 
2020 
£m

Carrying 
amount 
2019 
£m

Amounts 
recognised in 
income 
statement 
2019 
£m

Gain/(loss) 
to equity 
2019 
£m

0.2
0.2

–
–

246.6
15.6
94.9
357.1

(11.2)
(444.3)
(4.8)
(40.7)
(501.0)
(143.7)

–
–

–
–

6.9
(0.1)
0.4
7.2

–
(4.5)
(0.1)
(1.9)
(6.5)
0.7

–
–

–
–

–
–
–
–

–
–
–
–
–
–

–
–

–
–

182.8
10.9
139.4
333.1

(11.8)
(296.0)
–
(40.7)
(348.5)
(15.4)

–
–

0.7
0.7

7.1
(0.3)
1.2
8.0

–
(5.7)
–
(1.8)
(7.5)
1.2

–
–

–
–

–
–
–
–

–
–
–
–
–
–

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. 

The Group has a policy of reviewing the financial information of prospective occupiers and only dealing with those that are 
creditworthy and obtaining sufficient rental cash deposits or third-party guarantees as a means of mitigating financial loss 
from defaults. 

The concentration of credit risk is limited due to the large and diverse occupier base. Accordingly, the directors believe that 
there is no further expected credit loss required in excess of that provided. The carrying amount of financial assets recorded 
in the financial statements, which is net of impairment losses, represents the Group’s maximum exposure to credit risk without 
taking account of the value of rent deposits obtained. Details of the Group’s receivables are summarised in note 15 of the 
financial statements.

The Group’s cash deposits are placed with a diversified range of banks, and strict counterparty limits ensure the Group’s 
exposure to bank failure is minimised.

Capital risk

The Group manages its capital to ensure that entities in the Group will be able to operate on a going concern basis and as 
such it aims to maintain an appropriate mix of debt and equity financing. The current capital structure of the Group consists 
of a mix of equity and debt. Equity comprises issued share capital, reserves and retained earnings as disclosed in the Group 
statement of changes in equity. Debt comprises long-term debenture stock, private placement notes, convertible bonds and 
drawings against committed revolving credit facilities from banks. The Group aims to maintain a loan-to-property value of 
between 10% – 40% (see note 9).

The Group operates solely in the United Kingdom, and its operating profits and net assets are Sterling denominated. 
As a result, the Group’s policy is to have no unhedged assets or liabilities denominated in foreign currencies. The currency 
risk on overseas transactions has historically been fully hedged through foreign currency derivatives to create a synthetic 
sterling exposure.

180

Great Portland Estates  Annual Report 2020

18 Financial instruments continued

Liquidity risk

The Group operates a framework for the management of its short-, medium- and long-term funding requirements. Cash flow 
and funding needs are regularly monitored to ensure sufficient undrawn facilities are in place. The Group’s funding sources are 
diversified across a range of bank and bond markets and strict counterparty limits are operated on deposits.

The Group meets its day-to-day working capital requirements through the utilisation of its revolving credit facility. 
The availability of this facility depends on the Group complying with a number of key financial covenants; these covenants and 
the Group’s compliance with them are set out in the table below:

Key covenants

Group
Net debt/net equity
Inner borrowing (unencumbered asset value/unsecured borrowings)
Interest cover

Covenant

March 2020 
actuals

<1.25x
>1.66x
>1.35x

0.162x
4.267x
n/m

Due to low levels of consolidated Group debt, there was no net interest charge (as measured under our debt covenants) in the 
year, as a result interest cover was not measurable. The Group has undrawn credit facilities of £301.0 million and has substantial 
headroom above all of its key covenants. As a result, the directors consider the Group to have adequate liquidity to be able to 
fund the ongoing operations of the business.

The following tables detail the Group’s remaining contractual maturity on its financial instruments and have been drawn up 
based on the undiscounted cash flows of financial liabilities, including associated interest payments, based on the earliest date 
on which the Group is required to pay, and conditions existing at the balance sheet date:

At 31 March 2020

Non-derivative financial liabilities 
£142.9 million 55⁄8% debenture stock 2029
£450.0 million revolving credit facility
Private placement notes

Carrying 
amount 
£m

Contractual 
cash flows 
£m

Less than 
one year 
£m

One to 
two years 
£m

Two to 
five years 
£m

More than 
five years 
£m

22.0
148.1
274.2
444.3

32.7
162.4
312.8
507.9

1.2
2.5
5.9
9.6

1.2
2.6
5.9
9.7

3.7
157.3
189.5
350.5

26.6
–
111.5
138.1

At 31 March 2019

Non-derivative financial liabilities 
£142.9 million 55⁄8% debenture stock 2029
£450.0 million revolving credit facility
Private placement notes

Interest rate risk

Carrying 
amount 
£m

Contractual 
cash flows 
£m

Less than 
one year 
£m

One to 
two years 
£m

Two to 
five years 
£m

More than 
five years 
£m

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22.0
–
274.0
296.0

33.9
5.2
318.6
357.7

1.2
1.5
5.9
8.6

1.2
1.5
5.9
8.6

3.7
2.2
17.7
23.6

27.8
–
289.1
316.9

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Interest rate risk arises from the Group’s use of interest-bearing financial instruments. It is the risk that future cash flows arising 
from a financial instrument will fluctuate due to changes in interest rates. It is the Group’s policy to reduce interest rate risk in 
respect of the cash flows arising from its debt finance either through the use of fixed rate debt or through the use of interest 
rate derivatives such as swaps, caps and floors. It is the Group’s usual policy to maintain the proportion of floating interest rate 
exposure to between 20%–40% of forecast total debt. However, this target is flexible, and may not be adhered to at all times 
depending on, for example, the Group’s view of future interest rate movements. At 31 March 2020, the Group had no interest 
rate derivatives. 

Annual Report 2020  Great Portland Estates 181

 
Notes forming part of the Group financial statements continued

18 Financial instruments continued

Interest rate sensitivity

The sensitivity analysis below has been determined based on the exposure to interest rates for financial instruments at the 
balance sheet date, and represents management’s assessment of possible changes in interest rates based on historical trends. 
For the floating rate liabilities, the analysis is prepared assuming the amount of the liability at 31 March 2020 was outstanding 
for the whole year:

Increase of 100 basis points
Increase of 50 basis points
Decrease of 25 basis points
Decrease of 50 basis points

Fair value of interest-bearing loans and borrowings

Items not carried at fair value
£142.9 million 55⁄8% debenture stock 2029
Private placement notes 
£450.0 million revolving credit facility

Impact on profit

Impact on equity

2020 
£m

(1.5)
(0.8)
0.4
0.8

2019
£m

0.7
0.4
(0.2)
(0.4)

2020 
£m

(1.5)
(0.8)
0.4
0.8

2019
£m

0.7
0.4
(0.2)
(0.4)

Book value 
2020 
£m

Fair value 
2020 
£m

Book value  
2019 
£m

Fair value  
2019 
£m

22.0
274.2
148.1
444.3

28.6
257.8
148.1
434.5

22.0
274.0
–
296.0

27.3
275.9
–
303.2

The fair values of the Group’s private placement notes were determined by comparing the discounted future cash flows using 
the contracted yields with those of the reference gilts plus the implied margins, representing Level 2 fair value measurements 
as defined by IFRS 13 Fair Value Measurement.

The fair values of the Group’s cash and cash equivalents and trade payables and receivables are not materially different from 
those at which they are carried in the financial statements.

19 Head lease obligations
Head lease obligations in respect of the Group’s leasehold properties are payable as follows:

Less than one year
Between two and five years
More than five years

Minimum
 lease
payments
2020
£m

1.9
9.5
193.0
204.4

Impact of 
discounting
2020
£m

(1.9)
(9.4)
(152.4)
(163.7)

Present value 
of minimum 
lease 
payments  

2020
£m

–
0.1
40.6
40.7

Minimum
lease
payments
2019
£m

1.9
9.5
194.9
206.3

Present value 
of minimum 
lease payments
2019
£m

–
0.1
40.6
40.7

Interest
2019
£m

(1.9)
(9.4)
(154.3)
(165.6)

20 Occupational lease obligations
Obligations in respect of the Group’s occupational leases for its head office are payable as follows:

Less than one year
Between two and five years
More than five years

Minimum
 lease
payments
2020
£m

Impact of 
discounting
2020
£m

1.0
4.1
–
5.1

(0.1)
(0.2)
–
(0.3)

Present value 
of minimum 
lease 
payments  

2020
£m

0.9
3.9
–
4.8

Minimum
lease
payments
2019
£m

Impact of 
discounting
2019
£m

Present value 
of minimum 
lease payments
2019
£m

–
–
–
–

–
–
–
–

–
–
–
–

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21 Share capital

Allotted, called up and fully paid ordinary shares  
of 15 5⁄19 pence
At 1 April 
Share buyback
At 31 March

2020
Number

2020
£m

2019
Number

2019
£m

271,365,894
(17,497,983)
253,867,911

41.4
(2.7)
38.7

281,663,675
(10,297,781)
271,365,894

43.0
(1.6)
41.4

On 15 November 2018, the Company announced its intention to return up to £200 million of equity to shareholders over a 
twelve-month period through a share buyback. During the year, the Company bought 17,497,983 shares at an average price 
of £7.24 per share including costs. After taking account the completion of the share buyback, at 31 March 2020, the Company 
had 253,867,911 ordinary shares with a nominal value of 15 5⁄19 pence each.

22 Investment in own shares

At 1 April
Employee Long-Term Incentive Plan charge
Transfer to retained earnings
At 31 March

2020 
£m

1.7
(2.6)
1.5
0.6

2019
£m

2.4
(1.3)
0.6
1.7

The investment in the Company’s own shares is held at cost and comprises 1,109,303 shares (2019: 1,109,303 shares) held by the 
Great Portland Estates plc LTIP Employee Share Trust which will vest for certain senior employees of the Group if performance 
conditions are met. During the year, no shares (2019: 68,834 shares) were awarded to directors and senior employees in respect 
of the 2016 LTIP award and no additional shares were acquired by the Trust (2019: 0 shares). The fair value of shares awarded 
and outstanding at 31 March 2020 was £7.3 million (2019: £5.1 million).

23 Notes to the Group statement of cash flows

Reconciliation of financing liabilities

Long-term borrowings 
Obligations under leases

1 April 
2019 
£m

296.0
40.7
336.7

New 
obligations 
£m

Inflows/
(outflows) 
£m

Fair value 
changes 
£m

–
5.6
5.6

149.1
(2.8)
146.3

–
–
–

Other
£m

(0.8)
2.0
1.2

Long-term borrowings 
Short-term borrowings
Obligations under leases
Obligation to redeem B shares

Adjustment for non-cash items

Deficit/(surplus) from investment property
Employee Long-Term Incentive Plan charge
Spreading of tenant lease incentives
Share of results of joint ventures
Depreciation
Other
Adjustments for non-cash items

1 April 
2018 
£m

196.2
150.9
40.8
306.0
693.9

Outflows 
£m

–
(149.6)
–
(306.0)
(455.6)

New 
obligations 
£m

Fair value 
changes 
£m

99.7
–
–
–
99.7

–
(1.3)
–
–
(1.3)

Other
£m

0.1
–
(0.1)
–
–

2020 
£m

52.6
2.6
(0.3)
(57.9)
1.5
(0.9)
(2.4)

31 March
2020 
£m

444.3
45.5
489.8

31 March
2019 
£m

296.0
–
40.7
–
336.7

2019
£m

(7.3)
1.3
1.6
(10.0)
0.7
–
(13.7)

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Notes forming part of the Group financial statements continued

24 Dividends

Dividends paid
Interim dividend for the year ended 31 March 2020 of 4.7 pence per share
Final dividend for the year ended 31 March 2019 of 7.9 pence per share
Interim dividend for the year ended 31 March 2019 of 4.3 pence per share
Final dividend for the year ended 31 March 2018 of 7.3 pence per share

2020  
£m

2019  
£m

11.9
21.3
–
–
33.2

–
–
12.0
20.5
32.5

A final dividend of 7.9 pence per share was approved by the Board on 20 May 2020 and, subject to shareholder approval, 
will be paid on 28 July 2020 to shareholders on the register on 29 May 2020. The dividend is not recognised as a liability at 
31 March 2020. The 2019 final dividend and the 2020 interim dividend are included within the Group statement of changes 
in equity.

25 Lease obligations
Future aggregate minimum rentals receivable under non-cancellable operating leases are:

The Group as a lessor
Less than one year
Between two and five years
More than five years

2020  
£m

2019  
£m

71.0
154.4
63.7
289.1

73.6
187.9
88.8
350.3

The Group leases its investment properties under operating leases. The weighted average length of lease at 31 March 2020 
was 3.6 years (2019: 4.3 years). All investment properties, except those under development, generated rental income and no 
contingent rents were recognised in the year (2019: £nil).

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26 Employee benefits
The Group operates a UK-funded approved defined contribution plan. The Group’s contribution for the year was £0.4 million 
(2019: £0.7 million). The Group also contributes to a defined benefit final salary pension plan (the Plan), the assets of which are 
held and managed by trustees separately from the assets of the Group. The Plan has been closed to new entrants since April 
2002. The most recent actuarial valuation of the Plan was conducted at 1 April 2017 by a qualified independent actuary using 
the projected unit method. The Plan was valued using the following key actuarial assumptions:

Discount rate
Expected rate of salary increases
RPI inflation
Rate of future pension increases

Life expectancy assumptions at age 65:

Retiring today age 65
Retiring in 25 years (age 40 today)

The amount recognised in the balance sheet in respect of the Plan is as follows:

Present value of unfunded obligations
Fair value of the Plan assets
Pension deficit

Amounts recognised as administration expenses in the income statement are as follows:

Current service cost
Net interest cost

Changes in the present value of the pension obligation are as follows:

Defined benefit obligation at 1 April
Service cost
Interest cost
Effect of changes in financial assumptions
Benefits paid
Present value of defined benefit obligation at 31 March

Changes to the fair value of the Plan assets are as follows:

Fair value of the Plan assets at 1 April
Interest income
Actuarial (loss)/gain
Employer contributions
Benefits paid
Fair value of the Plan assets at 31 March

Net pension liability

2020  
%

2.30
3.50
2.50
5.00

2020  
Years

24
26

2020  
£m

(35.9)
35.5
(0.4)

2020  
£m

(0.3)
–
(0.3)

2020  
£m

36.6
0.3
0.9
(0.4)
(1.5)
35.9

2020  
£m

36.6
0.9
(0.8)
0.3
(1.5)
35.5

2019  
%

2.50
4.20
3.20
5.00

2019  
Years

24
26

2019  
£m

(36.6)
36.6
–

2019  
£m

(0.3)
–
(0.3)

2019  
£m

34.5
0.3
0.9
1.8
(0.9)
36.6

2019  
£m

35.0
0.9
0.9
0.7
(0.9)
36.6

0.4

–

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Notes forming part of the Group financial statements continued

26 Employee benefits continued
The amount recognised immediately in the Group statement of comprehensive income was a loss of £0.4 million 
(2019: £0.9 million).

Virtually all equity and debt instruments have quoted prices in active markets. The fair value of the Plan assets at the balance 
sheet date is analysed as follows:

Cash
Equities
Bonds

2020  
£m

0.1
14.3
21.1
35.5

2019  
£m

0.2
14.3
22.1
36.6

Other than market and demographic risks, which are common to all retirement benefit schemes, there are no specific risks in 
the relevant benefit schemes which the Group considers to be significant or unusual. Detail on two of the more specific risks is 
detailed below:

Changes in bond yields
Falling bond yields tend to increase the funding and accounting liabilities. However, the investment in corporate and 
government bonds offers a degree of matching, i.e. the movement in assets arising from changes in bond yields partially 
matches the movement in the funding or accounting liabilities. In this way, the exposure to movements in bond yields 
is reduced.

Life expectancy
The majority of the obligations are to provide a pension for the life of the member on retirement, so increases in life 
expectancy will result in an increase in the liabilities. The inflation-linked nature of the majority of benefit payments increases 
the sensitivity of the liabilities to changes in life expectancy.

The effect on the defined benefit obligation of changing the key assumptions, calculated using approximate methods based 
on historical trends, is set out below:

Discount rate -0.25%
Discount rate +0.25%
RPI inflation -0.25%
RPI inflation +0.25%
Post-retirement mortality assumption – one year age rating

2020  
£m

37.7
34.2
35.1
36.7
37.6

2019  
£m

38.5
34.9
35.8
37.5
38.2

The Group expects to contribute £0.7 million to the Plan in the year ending 31 March 2021. The expected total benefit 
payments for the year ending 31 March 2021 is £0.7 million, with £5.0 million expected to be paid over the next five years. 
A funding plan has been agreed committing the Group to cash combinations of £347,000 p.a. over five years as well as 
a contribution rate of 46.8% p.a. of member pensionable salaries to eliminate any funding shortfalls and the ongoing 
benefit accrual.

27 Reserves
The following describes the nature and purpose of each reserve within equity:

Share capital

The nominal value of the Company’s issued share capital, comprising 15 5⁄19 pence ordinary shares.

Share premium 

Amount subscribed for share capital in excess of nominal value, less directly attributable issue costs.

Capital redemption reserve

Amount equivalent to the nominal value of the Company’s own shares acquired as a result of share buyback programmes.

Retained earnings 

Cumulative net gains and losses recognised in the Group income statement together with other items such as dividends.

Investment in own shares

Amount paid to acquire the Company’s own shares for its Employee Long-Term Incentive Plan less accounting charges.

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Independent auditor’s report 
to the members of Great Portland Estates plc

Report on the audit of the financial statements

1. Opinion

In our opinion:

 – the financial statements of Great Portland Estates plc (the ‘Parent Company’) and its subsidiaries (the ‘Group’) give a true 
and fair view of the state of the Group’s and of the Parent Company’s affairs as at 31 March 2020 and of the Group’s profit 
for the year then ended;

 – the Group financial statements have been properly prepared in accordance with International Financial Reporting 

Standards (IFRSs) as adopted by the European Union;

 – the Parent Company financial statements have been properly prepared in accordance with United Kingdom Generally 
Accepted Accounting Practice, including Financial Reporting Standard 101 “Reduced Disclosure Framework”; and

 – the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, 

as regards the Group financial statements, Article 4 of the IAS Regulation.

We have audited the financial statements which comprise:

 – the Group income statement;

 – the Group statement of comprehensive income;

 – the Group and Parent Company balance sheets;

 – the Group and Parent Company statements of changes in equity;

 – the Group cash flow statement; and

 – the related notes 1 to 27 for Group financial statements and i to vii for the Parent Company financial statements.

The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable 
law and IFRSs as adopted by the European Union. The financial reporting framework that has been applied in the preparation 
of the Parent Company financial statements is applicable law and United Kingdom Accounting Standards, including FRS 101 
“Reduced Disclosure Framework” (United Kingdom Generally Accepted Accounting Practice).

2. Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. 
Our responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial 
statements section of our report. 

We are independent of the Group and the Parent Company in accordance with the ethical requirements that are relevant 
to our audit of the financial statements in the UK, including the Financial Reporting Council’s (the ‘FRC’s’) Ethical Standard 
as applied to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these 
requirements. The non-audit services provided to the Group and Parent Company for the year are disclosed in note 5 to the 
financial statements. We confirm that the non-audit services prohibited by the FRC’s Ethical Standard were not provided to the 
Group or the Parent Company.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

3. Summary of our audit approach

Key audit matters

The key audit matter that we identified in the current year was:

 – Valuation of the property portfolio.

Materiality

Scoping

The materiality that we used for the Group financial statements was £30.0 million which was 
determined on the basis of approximately 1% of net assets.

Our Group audit scope comprises the audit of Great Portland Estates plc as well as the Group’s 
subsidiaries and joint ventures. 

The Group team performs full scope audits for all of the subsidiaries and joint venture which are 
subject to statutory audit requirements. Those entities not subject to an underlying statutory audit 
are audited based on component materiality.

Significant changes  
in our approach

There have been no significant changes in our audit approach, other than to consider the impact 
of the COVID-19 pandemic which is discussed in more detail in the key audit matter and our 
approach to controls.

Annual Report 2020  Great Portland Estates 187

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Independent auditor’s report continued

4. Conclusions relating to going concern, principal risks and viability statement

4.1 Going concern

We have reviewed the directors’ statement in note 1 to the financial 
statements about whether they considered it appropriate to adopt 
the going concern basis of accounting in preparing them and their 
identification of any material uncertainties to the Group’s and Parent 
Company’s ability to continue to do so over a period of at least twelve 
months from the date of approval of the financial statements.

We considered as part of our risk assessment the nature of the Group, 
its business model and related risks including where relevant the impact 
of the Covid-19 pandemic and Brexit, the requirements of the applicable 
financial reporting framework and the system of internal control. We 
evaluated the directors’ assessment of the Group’s ability to continue 
as a going concern, including challenging the underlying data and key 
assumptions used to make the assessment, and evaluated the directors’ 
plans for future actions in relation to their going concern assessment.

We are required to state whether we have anything material to add or 
draw attention to in relation to that statement required by Listing Rule 
9.8.6R(3) and report if the statement is materially inconsistent with our 
knowledge obtained in the audit.

Going concern is the 
basis of preparation of 
the financial statements 
that assumes an entity 
will remain in operation 
for a period of at least 
12 months from the 
date of approval of the 
financial statements.

We confirm that we 
have nothing material 
to report, add or draw 
attention to in respect 
of these matters.

4.2  Principal risks and 
viability statement

Based solely on reading the directors’ statements and considering 
whether they were consistent with the knowledge we obtained in the 
course of the audit, including the knowledge obtained in the evaluation 
of the directors’ assessment of the Group’s and the Parent Company’s 
ability to continue as a going concern, we are required to state whether 
we have anything material to add or draw attention to in relation to:

Viability means the 
ability of the Group 
to continue over 
the time horizon 
considered appropriate 
by the directors. 

We confirm that we 
have nothing material 
to report, add or draw 
attention to in respect 
of these matters.

 – the disclosures on pages 80 to 93 that describe the principal risks, 

procedures to identify emerging risks, and an explanation of 
how these are being managed or mitigated;

 – the directors’ confirmation on page 80 that they have carried out 

a robust assessment of the principal and emerging risks facing the 
Group, including those that would threaten its business model, 
future performance, solvency or liquidity; or

 – the directors’ explanation on page 94 as to how they have assessed 

the prospects of the Group, over what period they have done so and 
why they consider that period to be appropriate, and their statement 
as to whether they have a reasonable expectation that the Group will 
be able to continue in operation and meet its liabilities as they fall due 
over the period of their assessment, including any related disclosures 
drawing attention to any necessary qualifications or assumptions.

We are also required to report whether the directors’ statement relating 
to the prospects of the Group required by Listing Rule 9.8.6R(3) is 
materially inconsistent with our knowledge obtained in the audit.

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5. Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial 
statements of the current period and include the most significant assessed risks of material misstatement (whether or not 
due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the 
allocation of resources in the audit; and directing the efforts of the engagement team.

These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our 
opinion thereon, and we do not provide a separate opinion on these matters.

5.1 Valuation of property portfolio 

Key audit  
matter description

The Group owns a portfolio of property assets in central London. The portfolio is valued at £2,624.1 
million (2019: £2,579.0 million), including share of joint venture properties, as at 31 March 2020.

The valuation of the investment and development property portfolio is a key source of estimation 
uncertainty and includes a number of assumptions including capitalisation yields and estimated 
rental values (ERVs) as well as forecast cost to complete, the level of developer’s profit and financing 
costs in relation to development properties. Due to the high level of estimation required in 
determining the valuation, we have determined that there is a potential fraud risk in the balance.

The Group uses professionally qualified external valuers to fair value the Group’s wholly-owned 
portfolio bi-annually and the joint venture portfolio quarterly. The valuers are engaged by 
the Directors and performed their work in accordance with the Royal Institution of Chartered 
Surveyors (‘RICS’) Valuation – Professional Standards. 

As detailed in note 10, in applying the Royal Institute of Chartered Surveyors (RICS) Valuation Global 
Standards 2020 (‘Red Book’), the Group’s external valuer, CBRE, has declared a ‘material valuation 
uncertainty’ in their valuation report on the portfolio as at 31 March 2020. This is on the basis that 
market activity as a whole has been so significantly impacted by the effects of Covid-19 such that 
as at the valuation date they consider that they can attach less weight to previous market evidence 
for comparison purposes to inform opinions of value, and that a higher degree of caution should 
be attached to their valuation.

In addition to this, and consistent with the market conditions observed in the prior year, we note 
there continued to be a higher level of judgement associated with certain asset valuations, notably 
those with a significant retail element and those held under short leaseholds. Covid-19 further 
increased judgement in relation to assumptions around:

 – occupier demand and solvency; 

 – asset liquidity; 

 – the relative impact on the different sectors including retail, hospitality and leisure and flexible 

office space; and

 – the assumptions around development progress on site and timelines to completion and letting.

Please see critical judgements and accounting policy at page 164 and 167, notes 10 and 12 
to the financial statements and discussion in the report of the Audit Committee on page 121. 

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Independent auditor’s report continued

How the scope of 
our audit responded 
to the key audit matter

We have performed testing of the property valuations and critically assessed the assumptions 
and estimates made. These procedures included:

Understanding of the process and relevant controls
We obtained and documented an understanding of relevant controls in the valuation process.

We met with key management to enhance our knowledge of the portfolio and to enable us to identify 
specific key assumptions for certain properties including property vacancies, leases nearing maturity 
or break clauses and significant ongoing tenant negotiations with existing and prospective tenants.

Data provided to the valuers
We assessed Management’s process for providing data to the valuer and their process for 
evaluating the output. 

We tested the integrity of a sample of the data provided to the external valuer. This included 
verifying a sample of information provided to the external valuer to underlying lease agreements, 
and verifying costs to complete.

We assessed the Group’s development appraisal process through meeting with project 
managers, testing management’s process to forecast costs to complete and inspecting 
commitments of key developments.

External valuation
We assessed the competence, capabilities and objectivity of the external valuer.

We obtained the external valuation reports and met with the external valuer to discuss the results 
of their work on a sample of properties. With the assistance of an expert member of the audit team, 
who is a chartered surveyor, we discussed and challenged the valuation process, performance of the 
portfolio and significant judgements and assumptions applied in their valuation model, including 
yields, occupancy rates, lease incentives and break clauses. Our challenge included benchmarking the 
key assumptions to external market data and comparable property transactions, in particular the yield. 
We specifically challenged them on the key assumptions applied in the valuations with reference to 
the ongoing impact of Brexit and the specific impact as at 31 March 2020 of COVID-19.

While we note the increased estimation uncertainty in relation to the property valuation as a result 
of COVID-19, and as disclosed in note 10, we considered the assumptions applied in arriving at the 
fair value of the Group’s investment and development property portfolio to be reasonable and the 
valuations to be suitable for inclusion in the financial statements at 31 March 2020.

Key observations

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6. Our application of materiality

6.1 Materiality

We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic 
decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the 
scope of our audit work and in evaluating the results of our work.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Group financial statements

Parent company financial statements

Materiality

£30.0 million (2019: £30.0 million)

£20.5 million (2019: £25.4 million)

Basis for 
determining 
materiality

Rationale for 
the benchmark 
applied

We determined materiality for the Group 
based on approximately 1% of net assets 
(2019: approximately 1% of net assets). 

We consider net assets to be a critical 
financial performance measure for the Group 
on the basis that it is a key metric used by 
management, investors, analysts and lenders.

We determined materiality for the Parent Company 
based on 3% of net assets (2019: 3% of net assets).

We consider net assets to be a critical financial 
performance measure on the basis that the Parent 
Company holds all the investments therefore making 
the Balance Sheet the relevant primary statement for 
management and lenders.

In addition to net assets, we consider EPRA Profit Before Tax to be a critical financial performance measure for the Group 
and we applied a lower threshold of £2.7 million (2019: £2.7 million) based on 5% (2019: 5%) of that measure for testing of all 
balances impacting this financial performance measure. 

Performance measures (£m)

Net Assets
£2,203m

Net Assets

Group materiality

6.2 Performance materiality

Group materiality
£30m

Component materiality 
upper limit
£27m

Audit Committee 
reporting threshold 
£1m

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We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and 
undetected misstatements exceed the materiality for the financial statements as a whole. Group performance materiality 
was set at 70% of Group materiality for the 2020 audit (2019: 70%). In determining performance materiality, we considered the 
following factors:

 – our risk assessment, including our assessment of the Group’s overall control environment and that we consider it appropriate 

to rely on controls over a number of business processes; and

 – our past experience of the audit, which has indicated a low number of corrected and uncorrected misstatements identified 

in prior periods.

6.3 Error reporting threshold

We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £1 million 
(2019: £1 million), as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. 
We also report to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of the 
financial statements.

Annual Report 2020  Great Portland Estates 191

 
Independent auditor’s report continued

7. An overview of the scope of our audit

7.1 Identification and scoping of components

Our Group audit was scoped by obtaining an understanding of the Group and its environment, including Group-wide controls, 
and assessing the risks of material misstatement at the Group level.

One audit team, led by the Senior Statutory Auditor, audits the Group. The audit is performed centrally, as the books and 
records for each entity within the Group are maintained at head office.

We also tested the consolidation process and carried out analytical procedures to confirm our conclusion that there were 
no significant risks of material misstatement of the aggregated financial information.

We perform full scope audits for all of the Group’s subsidiaries and joint ventures which are subject to statutory audit 
requirements at company specific materiality levels which are lower than Group materiality, these materiality levels range 
from £1,000 to £27 million (2019: under £1,000 to £27 million). Those entities not subject to an underlying statutory audit are 
audited based on component materiality. This comprises 100% (2019: 100%) of the Group’s revenue and 100% (2019: 100%) 
of net assets.

7.2 Our consideration of the control environment

From our understanding of the entity and after testing relevant controls, we relied on controls in performing our audit of:

 – Rental income;

 – Operating expenses;

 – Capital expenditure; and

 – Service charge and property expenditure.

We had planned to test the operating effectiveness of controls relating to the payroll cycle in the period. However, these 
controls were performed prior to moving to electronic reviews and sign-offs. Because the lockdown was declared prior to 
the necessary manually evidenced samples being provided, we were unable to complete operating effectiveness testing. 
We have therefore completed our substantive testing without taking controls reliance for these account balances.

Due to planned upgrades to the IT system, we did not plan and perform testing of the IT controls. 

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8. Other information
The directors are responsible for the other information. The other information comprises the information included in the 
annual report, other than the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly 
stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, 
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained 
in the audit or otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there 
is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the 
work we have performed, we conclude that there is a material misstatement of this other information, we are required to 
report that fact.

In this context, matters that we are specifically required to report to you as uncorrected material misstatements of the other 
information include where we conclude that:

 – Fair, balanced and understandable – the statement given by the directors that they consider the annual report and 
financial statements taken as a whole is fair, balanced and understandable and provides the information necessary for 
shareholders to assess the Group’s position and performance, business model and strategy, is materially inconsistent 
with our knowledge obtained in the audit; or

 – Audit committee reporting – the section describing the work of the Audit Committee does not appropriately address 

matters communicated by us to the Audit Committee; or

 – Directors’ statement of compliance with the UK Corporate Governance Code – the parts of the directors’ statement 

required under the Listing Rules relating to the company’s compliance with the UK Corporate Governance Code containing 
provisions specified for review by the auditor in accordance with Listing Rule 9.8.10R(2) do not properly disclose a departure 
from a relevant provision of the UK Corporate Governance Code.

We have nothing to report in respect of these matters.

9. Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of the financial 
statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is 
necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group’s and the Parent Company’s ability 
to continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern basis 
of accounting unless the directors either intend to liquidate the Group or the Parent Company or to cease operations, or have 
no realistic alternative but to do so.

Annual Report 2020  Great Portland Estates 193

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Independent auditor’s report continued

10. Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material 
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance 
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a 
material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually 
or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of 
these financial statements.

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance 
with laws and regulations are set out below.

A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: 
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

11. Extent to which the audit was considered capable of detecting irregularities, including fraud
We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and then 
design and perform audit procedures responsive to those risks, including obtaining audit evidence that is sufficient and 
appropriate to provide a basis for our opinion.

11.1 Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with 
laws and regulations, we considered the following:

 – the nature of the industry and sector, control environment and business performance including the design of the Group’s 

remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets;

 – the Group’s own assessment of the risks that irregularities may occur either as a result of fraud or error;

 – results of our enquiries of management, internal audit and the Audit Committee about their own identification and 

assessment of the risks of irregularities; 

 – any matters we identified having obtained and reviewed the Group’s documentation of their policies and procedures 

relating to:

 – identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-

compliance;

 – detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or 

alleged fraud;

 – the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

 – the matters discussed among the audit engagement team and involving relevant internal specialists, including tax and 

real estate valuation specialists regarding how and where fraud might occur in the financial statements and any potential 
indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for 
fraud and identified the greatest potential for fraud in the valuation of the investment and development property portfolio. 
In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of 
management override.

We also obtained an understanding of the legal and regulatory framework that the Group operates in, focusing on provisions 
of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial 
statements. The key laws and regulations we considered in this context included the UK Companies Act, Listing Rules as well 
as relevant provisions of tax legislation, including the REIT rules.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements 
but compliance with which may be fundamental to the Group’s ability to operate or to avoid a material penalty, most notably 
health and safety regulations.

194

Great Portland Estates  Annual Report 2020

11.2 Audit response to risks identified

As a result of performing the above, we identified Valuation of the Property Portfolio as a key audit matter related to the 
potential risk of fraud. The key audit matters section of our report explains the matter in more detail and also describes the 
specific procedures we performed in response to that key audit matter. 

 In addition to the above, our procedures to respond to risks identified included the following:

 – reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions 

of relevant laws and regulations described as having a direct effect on the financial statements;

 – enquiring of management, the Audit Committee and external legal counsel concerning actual and potential litigation 

and claims;

 – performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material 

misstatement due to fraud;

 – reading minutes of meetings of those charged with governance, reviewing internal audit reports and reviewing 

correspondence with HMRC; and

 – in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and 
other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential 
bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course 
of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members 
including internal specialists, and remained alert to any indications of fraud or non-compliance with laws and regulations 
throughout the audit.

Report on other legal and regulatory requirements

12. Opinions on other matters prescribed by the Companies Act 2006

In our opinion the part of the directors’ remuneration report to be audited has been properly prepared in accordance with 
the Companies Act 2006.

In our opinion, based on the work undertaken in the course of the audit:

 – the information given in the strategic report and the directors’ report for the financial year for which the financial 

statements are prepared is consistent with the financial statements; and

 – the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the Group and the Parent Company and their environment obtained in 
the course of the audit, we have not identified any material misstatements in the strategic report or the directors’ report.

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Annual Report 2020  Great Portland Estates 195

 
Independent auditor’s report continued

13. Matters on which we are required to report by exception

13.1 Adequacy of explanations received and accounting records

Under the Companies Act 2006 we are required to report to you if, in our opinion:

 – we have not received all the information and explanations we require for our audit; or

 – adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been 

received from branches not visited by us; or

 – the Parent Company financial statements are not in agreement with the accounting records and returns.

We have nothing to report in respect of these matters.

13.2 Directors’ remuneration

Under the Companies Act 2006 we are also required to report if in our opinion certain disclosures of directors’ remuneration 
have not been made or the part of the directors’ remuneration report to be audited is not in agreement with the accounting 
records and returns.

We have nothing to report in respect of these matters.

14. Other matters

14.1 Auditor tenure

Following the recommendation of the Audit Committee, we were appointed by the Shareholders on 15 July 2003 to audit the 
financial statements for the year ending 31 March 2004 and subsequent financial periods. The period of total uninterrupted 
engagement including previous renewals and reappointments of the firm is 17 years, covering the years ending 31 March 2004 
to 31 March 2020.

14.2 Consistency of the audit report with the additional report to the Audit Committee

Our audit opinion is consistent with the additional report to the Audit Committee we are required to provide in accordance 
with ISAs (UK).

15. Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies 
Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those matters we are 
required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not 
accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, 
for this report, or for the opinions we have formed.

Judith Tacon (Senior statutory auditor)
For and on behalf of Deloitte LLP 
Statutory Auditor 
London, United Kingdom 
9 June 2020

196

Great Portland Estates  Annual Report 2020

Company balance sheet
At 31 March 2020

Non-current assets
Fixed asset investments

Current assets
Debtors
Cash at bank and short-term deposits

Total assets
Current liabilities
Non-current liabilities
Interest-bearing loans and borrowings
Deferred tax

Total liabilities
Net assets

Capital and reserves
Share capital
Share premium account
Capital redemption reserve
Retained earnings
Investment in own shares
Shareholders’ funds

Notes

2020  
£m

2019  
£m

iii

iv

v

vi
vii

21

21

22

1,219.5
1,219.5

689.7
95.0
784.7
2,004.2
(876.0)

(444.3)
–
(444.3)
(1,320.3)
683.9

38.7
46.0
326.7
273.1
(0.6)
683.9

1,219.5
1,219.5

610.8
139.1
749.9
1,969.4
(831.3)

(296.0)
–
(296.0)
(1,127.3)
842.1

41.4
46.0
324.0
432.4
(1.7)
842.1

Notes: The loss within the Company financial statements was £0.9 million (2019: profit £349.7 million). References in roman 
numerals refer to the notes to the Company financial statements, references in numbers refer to the notes to the Group 
financial statements.

The financial statements of Great Portland Estates plc (registered number: 00596137) were approved by the Board on  
9 June 2020 and signed on its behalf by: 

Toby Courtauld 
Chief Executive 

Nick Sanderson
Finance and Operations Director

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Annual Report 2020  Great Portland Estates 197

 
 
 
Company statement of changes in equity
For the year ended 31 March 2020

Total equity at 1 April 2019

Loss for the year and total 
comprehensive expense

Share buyback

Dividends to shareholders

Employee Long-Term Incentive Plan 
charge

Transfer to retained earnings
Total equity at 31 March 2020

Notes

21

24

22

Share 
capital 
£m

41.4

–

(2.7)

–

–

–
38.7

Share  
premium 
account 
£m

Capital 
redemption 
reserve 
£m

Retained 
earnings 
£m

Investment  
in own  
shares  
£m

Total  
equity  
£m

46.0

324.0

432.4

(1.7)

842.1

–

–

–

–

–

2.7

–

–

–
46.0

–
326.7

(0.9)

(126.7)

(33.2)

–

1.5
273.1

–

–

–

2.6

(1.5)
(0.6)

(0.9)

(126.7)

(33.2)

2.6

–
683.9

At 31 March 2020, the Company had realised profits available for distribution in excess of £250 million.

Company statement of changes in equity
For the year ended 31 March 2019

Total equity at 1 April 2018

Profit for the year and total 
comprehensive income

Share buyback

Dividends to shareholders

Employee Long-Term Incentive Plan 
charge

Transfer to retained earnings
Total equity at 31 March 2019

Notes

21

24

22

Share 
capital 
£m

43.0

–

(1.6)

–

–

–
41.4

Share  
premium 
account 
£m

Capital 
redemption 
reserve 
£m

Retained 
earnings 
£m

Investment  
in own  
shares  
£m

Total  
equity  
£m

46.0

322.4

189.4

(2.4)

598.4

–

–

–

–

–

1.6

–

–

–
46.0

–
324.0

349.7

(74.8)

(32.5)

–

0.6
432.4

–

–

–

1.3

(0.6)
(1.7)

349.7

(74.8)

(32.5)

1.3

–
842.1

198

Great Portland Estates  Annual Report 2020

Notes forming part of the Company financial statements

i Accounting policies

Accounting convention

Great Portland Estates plc is a public company limited by shares incorporated and domiciled in the United Kingdom (England 
and Wales). The address of the registered office is given on page 211. The financial statements have been prepared on the 
historical cost basis except for the re-measurement of certain financial instruments to fair value. Historical cost is generally 
based on the fair value of the consideration given in exchange for the goods and services. There were no significant 
judgements made or critical estimates applied in the preparation of the financial statements. 

Disclosure exemptions adopted

The separate financial statements of the Company are presented as required by the Companies Act 2006. The Company 
meets the definition of a qualifying entity under FRS 100 (Financial Reporting Standard 100) issued by the Financial Reporting 
Council. Accordingly, the financial statements have therefore been prepared in accordance with FRS 101 (Financial Reporting 
Standard 101) Reduced Disclosure Framework as issued by the Financial Reporting Council incorporating the Amendments to 
FRS 101 issued by the FRC in July 2015 and July 2016.

In preparing these financial statements Great Portland Estates plc has taken advantage of all disclosure exemptions conferred 
by FRS 101. Therefore these financial statements do not include:

 – certain comparative information as otherwise required by EU endorsed IFRS;

 – certain disclosures regarding the Company’s capital;

 – a statement of cash flows;

 – certain disclosures in respect of financial instruments;

 – the effect of future accounting standards not yet adopted; and

 – disclosure of related party transactions with wholly-owned members of the Group.

The above disclosure exemptions have been adopted because equivalent disclosures are included in the consolidated Group 
accounts into which Great Portland Estates plc is consolidated.

Subsidiary undertakings and joint ventures

The Company is a holding and financing company for the Great Portland Estates plc Group. Shares in subsidiary undertakings 
and joint ventures are carried at amounts equal to their original cost less any provision for impairment.

Other

Accounting policies for share-based payments, other investment, deferred tax and financial instruments are the same as those 
of the Group and are set out on pages 164 to 168.

The Company participates in a group defined benefit scheme which is the legal responsibility of Great Portland Estates 
Services Limited as the sponsoring employer. There is no contractual agreement or stated policy for charging the net defined 
benefit cost. In accordance with IAS 19 (Revised 2011), the Company accounts for the contributions to the scheme as if it were a 
defined contribution scheme. Details of the Group’s pension plan can be found on pages 185 and 186.

The auditor’s remuneration for audit and other services is disclosed in note 5 to the Group accounts.

ii Profit attributable to members of the parent undertaking
As permitted by section 408 of the Companies Act 2006, the Company has not presented its own profit and loss account. 
The loss dealt within the financial statements of the Company was £0.9 million (2019: profit of £349.7 million). The employees 
of the Company are the directors and the Company Secretary. Full disclosure of the directors’ remuneration can be found 
on pages 126 to 154.

Annual Report 2020  Great Portland Estates 199

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Notes forming part of the Company financial statements continued

iii Fixed asset investments

At 1 April 2019

Additions
31 March 2020

Investment in 
joint ventures 
£m

Shares in 
subsidiary 
undertakings 
£m

0.2

–
0.2

1,219.3

–
1,219.3

Total  
£m

1,219.5

–
1,219.5

Shares in subsidiary undertakings and joint ventures are carried at cost less any provision for impairment. The historical cost 
of the shares in subsidiary undertakings and joint ventures at 31 March 2020 was £1,219.5 million (2019: £1,219.5 million).

The subsidiaries of the Company at 31 March 2020 were:

Direct subsidiaries

The Company has a 100% interest in the ordinary share capital of the following entities:

Principal activity

Principal activity

Great Portland Estates 
Services Limited

Property management G.P.E. (St Thomas Street) Limited

Property investment

Collin Estates Limited

Property investment

J.L.P. Investment Company Limited

Property investment

Courtana Investments Limited

Property investment

Knighton Estates Limited

Property investment

G.P.E. (Bermondsey Street) Limited

Property investment

Pontsarn Investments Limited

Property investment

Great Portland Estates Capital 
(Jersey) Limited

Finance company

Portman Square Properties 
Holdings Limited

Property investment

GPE (Brook Street) Limited 

Property investment

GPE Pension Trustee Limited

Property investment

GPE (GHS) Limited

Property investment

G.P.E. (Marcol House) Limited

Property investment

The Great Star Partnership Limited

Property investment

G.P.E. (Rathbone Place 1) Limited

Property investment

G.P.E. Construction Limited

Construction

G.P.E. (Rathbone Place 2) Limited

Property investment

The Rathbone Place Partnership  
(G.P. 1) Limited

Property investment

G.P.E. (Rathbone Place 3) Limited

Property investment

73/77 Oxford Street Limited

Property investment

200

Great Portland Estates  Annual Report 2020

iii Fixed asset investments continued 

Indirect subsidiaries

Principal activity

Principal activity

The Rathbone Place Partnership  
(G.P. 2) Limited

Holding company

Portman Square Properties Limited

Property investment

G.P.E. (Newman Street) Limited

Property investment

The City Place House Partnership 
(G.P.) Limited

Property investment

The Rathbone Place 
Limited Partnership*

Property investment

The City Tower Partnership  
(G.P.) Limited

Property investment

Rathbone Square No.1 Limited

Property investment

Rathbone Square No.2 Limited

Property investment

GWP Duke Street Limited

Property investment

GWP Grays Yard Limited

Property investment

The Newman Street Unit Trust

Property investment

Marcol House Jersey Limited

Property investment

* 

 The Group has taken advantage of the exemption, which is conferred by The Partnerships (Accounts) Regulations 2008, for preparing financial statements for 
The Rathbone Place Limited Partnership.

The Great Victoria Partnership  
(G.P.) Limited

The Great Wigmore Partnership 
(G.P.) Limited

Great Ropemaker Partnership  
(G.P.) Limited

Principal activity

Principal activity

Property investment

The Great Victoria Partnership (G.P.) 
(No. 2) Limited

Property investment

Property investment

Great Capital Partnership (G.P.) Limited Property investment

Property investment

Indirectly held joint venture entities

Principal activity

Principal activity

Great Victoria Property Limited

Property investment

The Great Victoria Partnership

Property investment

The Great Victoria Partnership  
(No. 2)

Property investment

Great Victoria Property (No. 2) Limited

Property investment

Great Wigmore Property Limited

Property investment

The Great Wigmore Partnership

Property investment

The Great Capital Partnership

Property investment

Great Capital Property Limited

Property investment

Great Ropemaker Property Limited Property investment

The Great Ropemaker Partnership

Property investment

Great Ropemaker Property 
(Nominee 1) Limited

Property investment

Great Ropemaker Property  
(Nominee 2) Limited

GHS (GP) Limited

Property investment

GPE (Hanover Square) Limited

The GHS Limited Partnership

Property investment

GHS (Nominee) Limited

Property investment

Property investment

Property investment

All of the above companies are registered at 33 Cavendish Square, London W1G 0PW and operate in England and Wales 
except for: Great Portland Estates Capital (Jersey) Limited which is registered at 47 Esplanade, St Helier, Jersey JE1 0BD; 
Marcol House Jersey Limited, GHS (GP) Limited, GHS (Nominee) Limited and The GHS Limited Partnership which are 
registered at 44 Esplanade, St Helier, Jersey, JE4 9WG; The Newman Street Unit Trust which is registered at 11 Old Jewry, 
London, EC2R 8DU. Great Portland Estates plc is the ultimate parent undertaking of the Great Portland Estates Group.

Annual Report 2020  Great Portland Estates 201

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Notes forming part of the Company financial statements continued

iv Debtors

Amounts owed by subsidiary undertakings

Amounts owed by joint ventures

Other debtors

v Current liabilities

Amounts owed to subsidiary undertakings

Amounts owed to joint ventures

Other taxes and social security costs

Other creditors

Accruals

vi Interest-bearing loans and borrowings

Bank loans

Debentures

Private placement notes

2020  
£m

436.6

252.1

1.0

689.7

2020 
£m

864.3

5.5

–

1.6

4.6

2019  
£m

421.2

188.2

1.4

610.8

2019  
£m

815.5

5.5

3.4

1.6

5.3

876.0

831.3

2020  
£m

148.2

22.0

274.1

444.3

2019  
£m

–

22.0

274.0

296.0

At 31 March 2020, property with a carrying value of £112.6 million (2019: £108.4 million) was secured under the first 
mortgage debenture stock. Further details of the Company’s loans and borrowings can be found on notes 17 and 18 
of the Group accounts.

vii Deferred tax

Net deferred tax in respect of other temporary differences

1 April 
2019
£m

–
–

Recognised in 
the income 
statement  

£m

–
–

31 March 
2020  
£m

–
–

A deferred tax asset of £nil million (2019: £1.1 million) relating to contingent share awards was not recognised because 
it is uncertain whether future taxable profits will arise against which this asset can be utilised.

202

Great Portland Estates  Annual Report 2020

Other information

In this section:

204 Five year record

205 Our properties and occupiers

208 Portfolio statistics

209 Glossary

211 Shareholders’ information

212 Financial calendar

A 
S P A C E 
T O   
S H A R E

Communal areas for occupiers to come  
together and collaborate

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Annual Report 2020  Great Portland Estates 203

 
Five year record

Based on the Group financial statements for the years ended 31 March 

2016  
£m

2017  
£m

2018  
£m

2019  
£m

2,932.1
543.4
172.4
(600.2)
(135.5)
2,912.2

2,351.9
480.8
246.7
(537.7)
196.7
2,738.4

2,305.2
423.7
19.5
(347.1)
(34.4)
2,366.9

2,025.0
511.9
5.6
(296.0)
63.2
2,309.7

2020
£m

1,987.1
647.0
–
(444.3)
13.3
2,203.1

£m

£m

£m

£m

£m

43.0
2,869.2
2,912.2

43.0
2,695.4
2,738.4

43.0
2,323.9
2,366.9

41.4
2,268.3
2,309.7

38.7
2,164.4
2,203.1

847p
847p

796p
799p

840p
845p

851p
853p

868p
868p

£m

75.5

4.1

79.6

(32.6)

(0.6)

4.0

50.4

422.2

66.8

£m

80.2

4.1

84.3

(27.4)

(0.3)

–

56.6

(136.9)

(57.2)

£m

92.0

5.2

97.2

(35.4)

11.6

(0.4)

73.0

35.5

41.2

539.4

(137.5)

149.7

7.8

(14.8)

13.5

9.2

–

9.0

(9.2)

10.1

38.9

(51.5)

555.1

(140.2)

1.1

0.8

556.2

(139.4)

9.8

(11.2)

8.5

(5.4)

(74.7)

76.7

(6.4)

70.3

£m

80.3

3.8

84.1

(37.0)

(9.5)

(0.3)

37.3

7.3

10.0

54.6

8.3

(8.1)

1.3

–

–

56.1

(6.6)

49.5

162.6p
161.9p
13.5p
9.2p

(40.8)p
(40.8)p
17.3p
10.1p

21.5p
18.2p
20.4p
11.3p

17.9p
17.1p
19.4p
12.2p

£m

79.9

2.1

82.0

(37.1)

0.8

(0.2)

45.5

(52.6)

57.9

50.8

7.3

(6.5)

–

–

–

51.6

0.2

51.8

20.0p
20.0p
22.0p
12.6p

Balance sheet

Property portfolio
Joint ventures
Trading property
Loans and borrowings
Other assets/(liabilities)
Net assets

Financed by

Issued share capital
Reserves 
Total equity

Net assets per share
EPRA NAV 

Income statement

Net rental income

Joint venture fee income

Rental and joint venture fee income

Property and administration expenses

Profit/(loss) on trading property

Development management (losses)/profits

(Deficit)/surplus on investment property

Share of results of joint ventures

Operating profit/(loss)

Finance income

Finance costs

Fair value movement on convertible bond

Fair value movement on derivatives

Non-recurring items

Profit/(loss) before tax

Tax

Profit/(loss) for the year

Earnings/(loss) per share – basic 
Earnings/(loss) per share – diluted
EPRA earnings per share – diluted
Dividend per share

204

Great Portland Estates  Annual Report 2020

Our properties and occupiers

1

4

2

5

3

6

In value order (GPE share)

Ownership

Property name

£200 million plus

50%

100%

Hanover Square

The Piccadilly Buildings

Location

Tenure

Rent roll 
(GPE share)
£

Net  
internal area 
sq ft

1

2

Rest of West End

FH/LH

–

Rest of West End

LH

15,243,200

£100 million – £200 million

100%

100%

100%

50%

100%

100%

1 Newman & 70/88 Oxford Street

Wells & More, 45 Mortimer Street

City Tower, 40 Basinghall Street

3 Noho

4 Noho

5 City

200 & 2014 Gray’s Inn Road

6 Midtown

Elsley House, 20/30 Great Titchfield Street

7 Noho

Kent House, 14/17 Market Place

8 Noho

£75 million – £100 million

100%

50%

100%

100%

100%

100%

100%

100%

Walmar House, 288/300 Regent Street

9 Noho

160 Old Street

City Place House, 55 Basinghall Street

10 City

11 City

Carrington House, 126/130 Regent Street

Rest of West End

50 Finsbury Square

12 City

New City Court, 14/20 St Thomas Street

13 Southwark

Minerva House

35 Portman Square

Southwark

14 Noho

FH

FH

LH

LH

FH

FH

LH

FH

LH

LH

FH

FH

FH

LH

221,100

187,800

119,100

123,300

143,200

287,900

65,000

59,200

56,500

161,900

176,600

31,000

–

6,906,600

7,171,000

5,893,700

4,857,700

4,206,100

4,350,000

4,176,600

3,562,600

3,562,900

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2,666,300

126,400

4,933,900

98,000

4,318,000

105,900

5,260,700

72,800

Annual Report 2020  Great Portland Estates 205

 
Our properties and occupiers continued

7

10

8

11

9

12

In value order (GPE share)

Ownership

Property name

Location

Tenure

£50 million – £75 million

50%

100%

100%

Mount Royal, 508/540 Oxford Street

15 Noho

The Hickman

Orchard Court

16 City

Noho

£30 million – £50 million

100%

100%

100%

100%

100%

50%

100%

46/58 Bermondsey Street

95/96 New Bond Street

48/54 Broadwick Street

10/12 Cork Street

Challenger House

103/113 Regent Street

31/34 Alfred Place

Southwark

Rest of West End

Rest of West End

Rest of West End

City

Rest of West End

Noho

£10 million – £30 million

100%

50%

100%

6/10 Market Place

Elm Yard

Noho

17 Midtown

Kingsland House, 122/124 Regent Street

Rest of West End

LH

FH

LH

FH

LH

FH

LH

FH

LH

LH

FH

FH

LH

Rent roll 
(GPE share)
£

Net  
internal area 
sq ft

5,934,500

–

2,459,100

92,100

74,400

47,900

1,968,500

46,800

1,250,000

266,800

1,797,300

1,412,500

2,125,000

2,396,000

1,314,200

1,332,200

592,300

9,600

25,870

21,300

14,400

56,900

42,700

18,400

49,400

8,700

206

Great Portland Estates  Annual Report 2020

13

16

14

15

17

In value order (GPE share)

Ownership

Property name

Below £10 million

100%

100%

100%

100%

100%

6 Brook Street

Poland Street

23/24 Newman Street

183/190 Tottenham Court Road

The Hickman B&C site

FH = Freehold or Virtual Freehold.
LH = Leasehold.

Top ten occupiers 

Occupier

New Look

Turner Broadcasting

Runway East

Richemont UK Limited

Winckworth Sherwood LLP

Carlton Communications Limited

Superdry

ITN Limited

Dennis Publishing Limited

1

2

3

4

5

6

7

8

9

10

Next Holdings Limited

Total

Location

Tenure

Rent roll 
(GPE share)
£

Net  
internal area 
sq ft

Rest of West End

Rest of West End

Noho

Noho

City

Use

Office

Office

Office

Office

Office

Office

Retail

Office

Office

Retail

LH

FH

LH

LH

FH

306,200

142,100

237,900

114,200

–

3,600

1,900

25,100

12,000

–

Rent roll 
(our share)  
£m

% of rent roll  
(our share)

3.9

3.0

2.8

2.6

2.5

2.4

2.1

1.8

1.6

1.4

3.8

2.9

2.8

2.6

2.5

2.4

2.1

1.8

1.6

1.4

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24.1

23.9

Annual Report 2020  Great Portland Estates 207

 
Portfolio statistics at 31 March 2020

Rental income

London North of Oxford Street 

Rest of West End

Total West End 
City, Midtown and Southwark

Office
Retail
Office
Retail

Office
Retail

Total City, Midtown and Southwark

Total let portfolio
Voids
Premises under refurbishment
Total portfolio

Rent roll security, lease lengths and voids

London North of Oxford Street 

Rest of West End

Total West End 
City, Midtown and Southwark

Office
Retail
Office
Retail

Office
Retail

Total City, Midtown and Southwark

Total portfolio

Rental values and yields

Wholly-owned

Share of joint ventures

Rent roll  
£m
25.8
6.2
12.9
10.3
55.2
23.7
2.4
26.1
81.3

Reversionary 
potential  
£m
–
(0.3)
0.1
0.7
0.5
10.8
–
10.8
11.3

Rent roll 
£m
–
6.0
–
2.1
8.1
11.2
0.2
11.4
19.5

Reversionary 
potential  
£m
–
(0.9)
–
–
(0.9)
1.4
–
1.4
0.5

Rental  
values 
£m
25.8
5.9
13.0
11.0
55.7
34.5
2.4
36.9
92.6
3.0
21.8
117.4

Rental  
values  
£m
–
5.1
–
2.1
7.2
12.6
0.2
12.8
20.0
–
14.0
34.0

Total rental 
values 
£m
25.8
11.0
13.0
13.1
62.9
47.1
2.6
49.7
112.6
3.0
35.8
151.4

Wholly-owned

Joint ventures

Rent roll 
secure for 
five years  
% 
25.3
56.8
5.0
30.1
25.1
4.2
73.7
10.4
20.4

Weighted  
average  
lease  
length  
Years 
4.2
4.6
2.3
3.9
3.8
2.3
12.7
3.2
3.6

Voids 
% 
0.8
5.3
2.4
5.3
2.6
1.4
12.1
2.4
2.5

Rent roll secure 
for five years  
% 
–
33.6
–
100.0
51.1
30.4
54.4
30.7
39.1

Weighted  
average  
lease  
length  
Years 
–
2.9
–
7.0
4.0
6.4
9.3
6.5
5.4

Voids 
% 
–
–
–
–
–
–
–
–
–

Wholly-owned

Joint ventures

Wholly-owned

Joint ventures

Average 
rent  
£psf
–
128.8
–
74.8

Average 
ERV  
£psf
–
110.1
–
128.7
108.2 114.2
51.4
45.1
51.2
78.1

45.9
45.5
45.9
60.2

True 
equivalent 
yield 
%
4.5
4.2
4.8
4.1
4.4
5.1
4.6
5.0
4.6

Initial  
yield  
%
4.0
4.0
4.2
3.7
4.0
3.1
2.4
3.1
3.7

True 
equivalent 
yield 
%
–
4.4
–
4.5
4.4
4.8
5.0
4.8
4.7

Initial  
yield  
%
–
7.3
–
4.8
6.6
3.2
3.7
3.2
4.2

London North of Oxford Street 

Rest of West End

Total West End
City, Midtown and Southwark

Office
Retail
Office
Retail

Office
Retail

Total City, Midtown and Southwark

Total portfolio

Average 
rent  
£psf
70.9
59.0
78.1
110.6
75.9
39.3
79.3
41.2
59.7

Average 
ERV  
£psf
75.1
77.4
80.7
119.9
78.8
56.2
76.8
56.0
68.4

208

Great Portland Estates  Annual Report 2020

Glossary

Building Research Establishment Environmental 
Assessment Methodology (BREEAM)
Building Research Establishment method of assessing, 
rating and certifying the sustainability of buildings.

Internal Rate of Return (IRR)
The rate of return that if used as a discount rate and applied 
to the projected cash flows that would result in a net present 
value of zero.

Cash EPS
EPRA EPS adjusted for non-cash items: tenant incentives, 
capitalised interest and charges for share-based payments.

Core West End
Areas of London with W1 and SW1 postcodes.

Development profit on cost
The value of the development at completion, less the value 
of the land at the point of development commencement 
and costs to construct (including finance charges, letting 
fees, void costs and marketing expenses).

Development profit on cost %
The development profit on cost divided by the land value 
at the point of development commencement together with 
the costs to construct.

Earnings Per Share (EPS)
Profit after tax divided by the weighted average number 
of ordinary shares in issue.

EPRA metrics
Standard calculation methods for adjusted EPS and NAV 
and other operating metrics as set out by the European 
Public Real Estate Association (EPRA) in their Best Practice 
and Policy Recommendations.

Estimated Rental Value (ERV)
The market rental value of lettable space as estimated 
by the Group’s valuers at each balance sheet date.

Fair value – Investment property
The amount as estimated by the Group’s valuers for which 
a property should exchange on the date of valuation 
between a willing buyer and a willing seller in an arm’s-
length transaction after proper marketing wherein the 
parties had each acted knowledgeably, prudently and 
without compulsion. In line with market practice, values 
are stated net of purchasers’ costs.

MSCI
Morgan Stanley Capital International (MSCI) is 
a company that produces an independent benchmark 
of property returns.

MSCI central London
An index, compiled by MSCI, of the central and inner 
London properties in their March annual valued universes.

Like-for-like (Lfl)
The element of the portfolio that has been held for the 
whole of the period of account.

Loan To Value (LTV)
Total bank loans, private placement notes, convertible 
bonds at nominal value and debenture stock, net of cash 
(including our share of joint ventures balances), expressed 
as a percentage of the market value of the property 
portfolio (including our share of joint ventures).

Net assets per share or Net Asset Value (NAV)
Equity shareholders’ funds divided by the number of 
ordinary shares at the balance sheet date.

Net debt
The book value of the Group’s bank and loan facilities, 
private placement notes and debenture loans plus the 
nominal value of the convertible bond less cash and 
cash equivalents.

Net gearing
Total Group borrowings (including the convertible bonds 
at nominal value) less short-term deposits and cash as 
a percentage of equity shareholders’ funds, calculated 
in accordance with our bank covenants.

Net initial yield
Annual net rents on investment properties as a percentage 
of the investment property valuation having added notional 
purchasers’ costs.

Flex
Individual fitted out, ready to occupy floors, let on 
flexible terms.

Non-PIDs
Dividends from profits of the Group’s taxable 
residual business.

Flex+
Flex with added levels of service and shared amenity.

Flex space partnerships
Revenue share agreements with flexible space operators.

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Annual Report 2020  Great Portland Estates 209

 
True equivalent yield
The constant capitalisation rate which, if applied to all cash 
flows from an investment property, including current rent, 
reversions to current market rent and such items as voids 
and expenditures, equates to the market value having taken 
into account notional purchasers’ costs. Assumes rent is 
received quarterly in advance.

Ungeared IRR
The ungeared internal rate of return (IRR) is the interest rate 
at which the net present value of all the cash flows (both 
positive and negative) from a project or investment equal 
zero, without the benefit of financing. The internal rate of 
return is used to evaluate the attractiveness of a project 
or investment.

Vacancy rate
The element of a property which is unoccupied but 
available for letting, expressed as the ERV of the vacant 
space divided by the ERV of the total portfolio.

Weighted Average Unexpired Lease Term (WAULT)
The Weighted Average Unexpired Lease Term expressed 
in years.   

Whole life surplus
The value of the development at completion, less the 
value of the land at the point of acquisition and costs 
to construct (including finance charges, letting fees, 
void costs and marketing expenses) plus any income 
earned over the period.

Glossary continued

Portfolio Internal Rate of Return (IRR)
The rate of return that if used as a discount rate and applied 
to the projected cash flows from the portfolio would result 
in a net present value of zero.

Property Income Distributions (PIDs)
Dividends from profits of the Group’s tax-exempt 
property rental business.

REIT
UK Real Estate Investment Trust. 

Rent Roll
The annual contracted rental income.

Reversionary potential
The percentage by which ERV exceeds rent roll on let space.

Topped up initial yield
Annual net rents on investment properties as 
a percentage of the investment property valuation 
having added notional purchasers’ costs and contracted 
uplifts from tenant incentives.

Total Accounting Return (TAR)
The growth in EPRA NAV per share plus ordinary dividends 
paid, expressed as a percentage of EPRA NAV per share 
at the beginning of the period.

Total Property Return (TPR)
Capital growth in the portfolio plus net rental income 
derived from holding these properties plus profit on 
sale of disposals expressed as a percentage return 
on the period’s opening value.

Total Shareholder Return (TSR)
The growth in the ordinary share price as quoted on the 
London Stock Exchange, plus dividends per share received 
for the period expressed as a percentage of the share 
price at the beginning of the period.

Triple net asset value (NNNAV)
NAV adjusted to include the fair value of the 
Group’s financial liabilities, deferred tax and tax arising 
on sale of trading properties on a diluted basis.

210

Great Portland Estates  Annual Report 2020

Shareholders’ information

Shareholder enquiries
All enquiries relating to holdings of shares, bonds or 
debentures in Great Portland Estates, including notification 
of change of address, queries regarding dividend/interest 
payments or the loss of a certificate, should be addressed 
to the Company’s registrars:

Link Asset Services 
The Registry 
34 Beckenham Road 
Beckenham 
Kent 
BR3 4TU

Tel: 0371 664 0300 
E-mail: shareholderenquiries@linkgroup.co.uk

Calls are charged at the standard geographic rate and will 
vary by provider. Calls outside the United Kingdom will be 
charged at the applicable international rate. Lines are open 
between 9.00am – 5.30pm, Monday to Friday excluding 
public holidays in England and Wales. 

Payment of dividends
If you would like your dividends/interest paid directly into 
your bank or building society account, you should write to 
Link Asset Services, including details of your nominated 
account. Although this will enable your dividend/interest 
to be paid directly into your account, your tax voucher 
will still be sent to your registered address.

Tax consequences of REIT status
As a REIT, dividend payments must be split between 
PIDs and non-PIDs. Information in respect of the tax 
consequences for shareholders of receiving dividends 
can be found on the Company’s website at  
www.gpe.co.uk/investors/shareholder-information/reits. 

Share dealing service
An online and telephone dealing service is available for 
UK shareholders through Link Share Deal. For further 
information on this service, or to buy and sell shares, 
please contact:

Online dealing – www.linksharedeal.com

If you are calling from overseas please dial +44 371 664 0300.

Telephone dealing – 0371 664 0445

Calls are charged at the standard geographical rate and will 
vary by provider. Lines are open between 8.00am–4.30pm 
Monday to Friday.

Website
The Company has a corporate website, which holds, 
amongst other information, a copy of our latest Annual 
Report and financial statements, a list of properties held 
by the Group and copies of all press announcements 
released over the last 12 months. The site can be found at 
www.gpe.co.uk.

Company Secretary
Darren Lennark

Registered office 
33 Cavendish Square 
London W1G 0PW 
Tel: 020 7647 3000 
Registered number: 596137 

Unsolicited telephone calls – boiler room scams
In recent years, some of our shareholders have 
received unsolicited telephone calls or correspondence 
concerning investment matters from organisations 
or persons claiming or implying that they have some 
connection with the Company. 

These are typically from overseas based ‘brokers’ who target 
UK shareholders offering to sell them shares that often turn 
out to be worthless or non-existent, or an inflated price for 
shares they own. These operations are commonly known as 
‘boiler rooms’. Shareholders are advised to be very wary of 
any offers of unsolicited advice, discounted shares, premium 
prices for shares they own or free reports into the Company. 
If you receive any unsolicited investment advice:

 – ensure you get the correct name of the person and firm;

 – check that the firm is on the Financial Conduct;

 – Authority (FCA) Register to ensure they are authorised 

at https://register.fca.org.uk;

 – use the details on the FCA Register to contact the firm;

 – call the FCA Consumer Helpline (0800 111 6768) if there 
are no contact details in the Register or you are told 
they are out of date; and

 – if the calls persist, hang up.

If you use an unauthorised firm to buy or sell shares, you 
will not have access to the Financial Ombudsman Service 
or the Financial Services Compensation Scheme. 

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Annual Report 2020  Great Portland Estates 211

 
2021
5 January
2020/21 interim dividend payable (provisional)1 
19 May
Announcement of 2020/21 full-year results (provisional)1, 2

1.  Provisional dates will be confirmed in the half-year results 

announcement 2020.

2.  The timetable for the potential final dividend will be confirmed 

in the 2021 Annual Report.

Financial calendar

2020
28 May
Ex-dividend date for 2019/20 final dividend
29 May
Registration qualifying date for 2019/20 final dividend
24 July
Annual General Meeting 
28 July
2019/20 final dividend payable
11 November
Announcement of 2020/21 interim results
19 November
Ex-dividend date for 2020/21 interim dividend (provisional)1 
20 November
Registration qualifying date for 2020/21  
interim dividend (provisional)1

212

Great Portland Estates  Annual Report 2020

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Great Portland Estates plc  
33 Cavendish Square, London W1G 0PW 
Tel: 020 7647 3000 
www.gpe.co.uk