All property companies are not the same. The difference with Derwent London is our resolute concentration on our particular markets accompanied by a painstaking attention to detail. This is allied with our dedication to finding opportunities, transforming properties, increasing floorspace, adding value and attracting, and looking after our tenants.

Since our formation, we have always concentrated our activities in central London, with a particular focus on the West End. It is rare for us to venture outside London. We not only know London, we have an intimate knowledge of each of our 17 different ‘villages’ within the capital, (see: Principal properties) and the people who work and live in them. We appreciate the different characters and cultures of London’s villages, and we can map a distinctive future for each of them.

We treat each building as a unique opportunity. While our approach to every property is consistent the solution for each will be different (see: Building value). Our business model has been proven and refined over time; it concentrates on refurbishment and regeneration and, only when appropriate, outright redevelopment. The only aspect that has changed over the years is that today we are able to work with larger properties, while maintaining our focus on the detail.

Not only do the directors have a wealth of experience within the property industry, they also have the detailed knowledge of our focused market gained from an average of 17 years with the company (see: Board of directors). In combination with a highly skilled management team, we have a very strong track record in helping reshape central London through inspirational design backed with sound business sense.

Despite the recent challenging economic climate, we have maintained a steady flow of new tenants, many of them household names. This is not the result of reacting with a short-term masterplan to beat the recession; rather it is the fruit of our long-term vision to create inspiring buildings. Our ethos has always been design-focused and value driven and we still strive to create exciting spaces for tenants that are distinctive and one step ahead of our competition. Our continuing goal is to provide arenas for new ideas and new communities to thrive in.

We work in a number of ways to understand our tenants’ requirements and maintain communication from the very start of their interest in a property and throughout their occupation, building extremely close relationships (see: Our tenants). In combination with a skilled lease management team, this translates into a high percentage of tenant retention following breaks and expiries as well as a historically low void rate. Coupled with these factors is our extensive use of fresh architectural, design and artistic talent. We build strong enduring relationships across multiple projects in order to obtain the highest levels of creative input. The communities we help to shape see the benefit along with our shareholders.

Our current portfolio is balanced from a number of different aspects:

• an emphasis on income producing buildings that offer refurbishment and development opportunities;
• a variety of types, sizes and locations of buildings;
• exposure to a wide variety of tenant sectors; and
• a focus on letting at mid-market rents, which provide value for tenants and growth opportunities for the group.

We are highly innovative not only in terms of plans for our buildings but also in respect of lease management solutions. Over the past three years, we have negotiated surrenders and changes in lease terms with several of our tenants at buildings including the Angel Building, 1-5 Grosvenor Place, the Charlotte Building and 71-81 Whitfield Street. All of these negotiations have provided us with increased control to progress our future plans for these buildings and their surrounding areas.

Our long-term financing approach has been ‘keep it simple, keep it flexible’, maintaining a straightforward loan structure with our core lenders backed by a sensible hedging policy. We have also maintained sustainable levels of gearing which have typically been lower than those of our peers.

This approach has contributed to the fact that, during a year when the majority of other listed property companies went to the market for additional funding through deeply discounted rights issues, we were the only major REIT not to raise equity in 2009. The average discount across the listed property sector for these cash calls was 64%. This has contributed to our shareholder return of 86.7% during 2009, a significant outperformance versus the FTSE All-Share Real Estate Investment Trust Index of 11.4%.

Over the years, we have cultivated strong relationships with institutional investors and banks, which have provided us with equity and loan finance. The experience and stability of our management team, the consistency of our message and an approach to risk that rewards our shareholders without endangering the business have all contributed to our reputation. We have put in place flexible and affordable finance that works with our portfolio matched by hedging and financial covenants that provide us with resilience. It is testament to the strength of our banking relationships and to the banks’ support for the group and its covenant position that, during the challenging economic climate of 2008 and 2009, we refinanced three facilities totalling £253m including £125m renewed in April 2009.

Whether it is building design or delivery, lease management or stable financing, putting in place the right resources is crucial for the effective and efficient execution of our strategy. We have the right resources, we employ the right people and we listen to the right advisers. We cultivate strong working relationships with all our external consultants. With each new project, these relationships evolve and strengthen. We are always receptive to new ideas, believing that it is essential to nurture, encourage and embrace the next generation of talent. Once we have forged new relationships, they often grow in tandem with each new project. Our portfolio is balanced in a multitude of ways and is characterised by a plethora of opportunities for development and value growth. Underpinning the whole of our operation is our stable and flexible approach to financing.

It is a combination of these resources and our robust strategy that has enabled us to weather the recent downturn so well delivering 82 lettings during 2008 and more than 100 lettings right across the portfolio during 2009.