Landsec full-year results 2026: rental growth, occupancy and earnings all point to a stronger business
Landsec has turned in a solid set of full-year results, and the big message is simple: its buildings are fuller, rents are rising faster, and the group looks less risky than it did a few years ago.
The headline grabbers are strong. Like-for-like net rental income rose 4.6%, EPRA occupancy hit 98.0%, and estimated rental values, or ERVs, climbed 6.4%. ERV is basically the rent Landsec thinks its space should achieve in the market, so rising ERVs are a good sign for future income.
That matters because property companies live and die by rental growth and balance sheet discipline. On both fronts, Landsec looks in decent shape.
| Key number | FY26 | FY25 |
|---|---|---|
| EPRA earnings | £382 million | £374 million |
| EPRA EPS | 51.4p | 50.3p |
| EPRA NTA per share | 882p | 874p |
| Dividend per share | 41.2p | 40.4p |
| Group LTV ratio | 38.7% | 39.3% |
| Net debt | £4,234 million | £4,341 million |
Why Landsec’s rental growth and 98.0% occupancy are such a big deal
The most encouraging part of this update is that the growth looks operational, not financial engineering. Occupancy rose by 80 basis points to 98.0%, which Landsec says is the highest in two decades, while rental uplifts on relettings and renewals jumped to 15% from 8% last year.
In plain English, tenants are sticking around and paying more when leases are renewed or space is re-let. That is exactly what you want to see from a landlord with a premium portfolio.
Landsec’s office assets delivered like-for-like net rental income growth of 6.0%, while retail delivered 5.5%. That is a healthy split. It also suggests this is not a one-trick business leaning on just one segment.
- Office ERVs rose 7.1%
- Retail ERVs rose 5.8%
- Office occupancy reached 98.6%
- Retail occupancy reached 97.7%
Those are powerful numbers in a market where plenty of investors still worry about offices and remain sceptical on retail. Landsec is effectively arguing that prime space in the right places is doing very well, even if the wider market is patchy. Based on these figures, that looks fair.
Landsec office portfolio update: full buildings, rising rents and strong leasing momentum
The office business looks better than many investors might have feared. Landsec says occupancy in its office-led portfolio is 98.6%, compared with 93.3% for the central London market as a whole.
That outperformance is important. It suggests the company is benefiting from a flight to quality, where tenants want the best-connected and best-specified buildings rather than just any old office.
There is also clear momentum in developments. Landsec said £45 million of ERV from schemes completed during the second half was already 54% let, with a further £35 million completing this summer. That supports management’s confidence that earnings growth should step up in FY28 once those buildings are filled.
The catch is that office values were basically flat, down 0.1%, because stronger rents were offset by softer yields, higher build costs and business rates pressure. So while the lettings story is good, the valuation story is not exactly flying.
Landsec retail results: shopping centres quietly doing the heavy lifting
The retail numbers are arguably the most interesting part of the announcement. This used to be the bit investors treated with caution. Now it is starting to look like one of the better engines in the group.
Retail sales across the portfolio rose 6.3% versus 1.1% for the UK average, while occupancy hit a 20-year high of 97.7%. Landsec also said it signed £49 million of lettings that were 11% above ERV.
That tells you its big retail destinations are still attracting brands and shoppers. Management is clearly leaning into that, saying major retail remains its highest conviction area for future investment.
My view is that this is sensible. Retail is no longer being treated as the problem child here. Landsec sees better yields and better income growth in top-tier retail than in new office development, and the numbers in this RNS back that up.
Landsec balance sheet, debt and disposals: less risk, but not a spotless picture
One of the stronger parts of the results is the financing profile. Landsec has an average debt maturity of 8.6 years, 89% of its debt is fixed or hedged, and it says there is no need to refinance debt until 2028.
That gives it breathing room in a higher-rate world. For a property company, that is a real advantage.
It also sold £705 million of lower-returning assets during the year. That included Queen Anne’s Mansions for £245 million, plus retail parks, smaller London offices and pre-development assets. The idea is straightforward: recycle capital out of weaker-return or riskier assets and focus on better opportunities.
The downside is that these sales came at a cost. Landsec says the disposals reduced net tangible assets by 1.1%, and IFRS profit before tax fell to £346 million from £393 million, partly due to a £105 million loss on disposals.
So yes, the strategy makes sense, but there is still some pain in clearing the decks.
Landsec FY27 and FY28 guidance: stable next year, then a likely step-up
Guidance is respectable rather than thrilling for FY27. Landsec expects like-for-like net rent growth of around 3-5%, but EPRA EPS is expected to be stable versus FY26.
That flat earnings outlook is mainly down to the full-year effect of the QAM sale, which management says will have a roughly 4% EPS impact. So the underlying business is still growing, but that growth is being masked by the disposal effect.
More interesting is FY28. Landsec expects high single digit percentage growth in EPRA EPS, driven by development leasing and continued rental growth. It also continues to target around 62p of EPRA EPS by FY30, implying roughly 5% compound annual growth from FY27 to FY30.
That is ambitious enough to matter, but not so aggressive that it looks fanciful. I would call it credible, provided the leasing momentum holds up.
What retail investors should like – and what should still worry them
What looks positive
- Rental growth is strong across both offices and retail
- Occupancy is extremely high at 98.0%
- Costs are falling, with overheads down 15% to £62 million
- Debt maturity is long and refinancing pressure is low
- Management is reducing development exposure and risk
What looks less comfortable
- FY27 EPRA EPS is only expected to be stable
- Office valuations remain under pressure from yield softening and build costs
- Net debt/EBITDA at 8.4x is still above Landsec’s usual guideline of less than 8x
- Geopolitical and interest rate risks have not gone away
My take on the Landsec results: good quality progress, not hype
This looks like a good update. Not perfect, but good. The strongest point is that the improvement feels earned: higher occupancy, higher rents, lower costs and a more cautious stance on development.
The market may not get too excited by flat FY27 EPS guidance, and that is understandable. But if you look through the accounting noise around disposals, the direction of travel is encouraging.
For retail investors, the key takeaway is that Landsec is behaving more like a disciplined income growth business and less like a big, cyclical property punt. That does not remove risk, but it does make the investment case cleaner.
If management delivers the promised FY28 acceleration and keeps debt trending down, this set of results could end up looking like an important stepping stone rather than just a decent year.
