SEGRO plc (LSE:SGRO) released its trading update for the first six months of 2026 on Wednesday, reporting £53 million of new headline rent contracted during the period.
Leasing Activity and Developments Drive Rental Growth
The industrial property specialist generated £27 million of new headline rent from its existing portfolio through leasing vacant space and capturing rental reversions. A further £26 million came from development lettings, including £24 million from new pre-let agreements signed during the first half.
The company also continued to benefit from strong rental growth across its portfolio. Rent reviews, renewals and regears delivered a 44% uplift in the UK, while the group-wide increase was 32%. In Continental Europe, rental uplifts averaged 4%.
Occupancy at the end of the period stood at 94.5%, slightly below the level reported at the end of 2025, reflecting the completion of speculative developments within SEGRO’s urban logistics portfolio in Germany.
Development Pipeline and Capital Allocation
SEGRO said it now has a record pipeline of developments either under construction or in advanced negotiations, representing potential annual rental income of £90 million. Around 75% of this pipeline is supported by pre-let agreements.
The company narrowed its 2026 capital expenditure guidance to between £500 million and £550 million, towards the upper end of its previous forecast range.
During the first half, SEGRO completed £213 million of property disposals at prices above book value, representing £10 million of associated rental income. It has also exchanged contracts on a further £95 million of disposals that are expected to complete before the end of 2026.
Balance Sheet and Data Centre Expansion
The EPRA cost ratio, excluding share-based payments, improved to below 18%, compared with 19.8% at the end of 2025.
Pro forma adjusted net asset value stood at 905 pence per share, marginally lower than at 31 December 2025 due to revised yield assumptions applied by the company’s new UK property valuer for selected urban assets.
SEGRO also continued to expand its data centre strategy, adding 0.5GVA to its strategic power bank, signing a second fully fitted joint venture with Pure DC and progressing discussions on its first fully fitted data centre lease at Park Royal in London.
The company is scheduled to publish its half-year 2026 results on 30 July.
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