British Land Company PLC (BTLCY) Earnings Call Transcript & Summary

Good morning, everyone. Thank you for joining us. It's great to be back at Broadgate for these set of results. You will have noticed quite a few changes on the campus over the last year since we were last here. And if you do get a little bit of time after the presentation, do check out the retail underneath 1 Broadgate. It launched last week, and it's already 90% let and under offer, which is a pretty good place to be. So in terms of today's agenda, I'll start with an overview. David will take you through the first half performance and also our earnings levers. And then Kelly will look at our strong leasing and accretive asset management over the period. But before I hand over to David, I'd like to take a step back and look at what's driving the future performance of the business. At the heart of this is the decision we took nearly 5 years ago to build a market-leading position in campuses and retail parks. Together, these now represent 90% of our business. These are sectors with strong occupational fundamentals. Demand is healthy, supply is constrained and rents are very affordable. The investment market is waking up to this. Investors are increasing their allocations to both retail and offices. And we are very well placed to capitalize on this. That's down to the quality of the assets, the experience of our team and our value-add mindset. The result, a very attractive total return profile, underpinned by sustainable earnings growth. So let's unpack this, starting with prime London offices, where a classic supply crunch is driving strong rental growth. The return to the office has exceeded expectations. Midweek utilization across our campuses is now above pre-pandemic levels. Businesses are short on space. Last year, they expanded by 3.3 million square feet, the highest since 2019. And active demand is now 50% above the long-term average. But supply remains tight. Initial concerns about working from home have been compounded by rising construction costs and higher interest rates. You can see on this slide, vacancy for new and refurbished space in the city is predicted to fall below 2% and stay there for the next 4 years. Historically, when this has happened, it has driven double-digit rental growth. We've positioned our portfolio to benefit from this supply squeeze. Office occupiers are focused on 4 key areas: quality, location, amenity and flexibility. Our campuses tick all the boxes. We currently account for 7 out of the top 20 leasing deals that are under offer in London. So we're capturing a disproportionate share of a very strong market. That's down to high-quality sustainable buildings, prime locations near transport hubs, excellent amenities and public realm and flexible offerings, ranging from story to fully fitted work-ready space to headquarter space. This flexibility is key for customers in the innovation sectors. This is a fast-growing market, especially in the Knowledge Quarter. The number of innovation customers in our portfolio has more than doubled since 2022. There's been strong growth from a new generation of AI and tech businesses with high levels of venture capital investment. This is a key source of new demand. We're tracking 1.5 million square feet of new requirements. Kelly will explain in a moment how we're benefiting from this at Regent's Place. Our on-site developments are achieving record rents, which is driving development yields above 7% and mid-teens IRRs. These record rents also provide valuable evidence for upcoming reviews across our campuses. We're derisking our schemes with pre-lets and fixed price contracts and increasingly bringing in partners such as Modon to reduce capital outlay, accelerate delivery and earn valuable fees. Let's move on now to retail parks. These continue to be the preferred format for retailers. They're efficient and adaptable, offer easy access, free parking, and they're ideal for a range of retailers, including value, grocery and multichannel. Retailers like M&S, Lidl, Aldi and Home Bargains are expanding into this format. Yet there's been virtually no new supply in the past decade, and we don't see this situation changing. Development economics are unattractive and planning is restrictive. As you know, we're the largest owner and operator of multi-let retail parks in the U.K. We have a portfolio stretching from the The Isle of Wight to Inverness. Half the U.K. population lives within a 30-minute drive of one of our assets. And we have deep reach with the retailers, given our scale, the experience of our team and our in-house property management. Of course, we use demographic and competition data, but nothing beats picking up the phone to a retailer to understand trading. Our focus on strong trading locations is reflected in our footfall. This has grown 13.5% above the U.K. retail benchmark over the last 5 years. Despite a more competitive investment market, we're still acquiring assets at yields above 7%. And we're comfortable taking occupational risk due to the market strength, our asset management expertise and those retailer relationships. In real estate, affordability is just as important as supply and demand. For prime offices and retail parks, the picture is very positive. London office rents relative to wages are lower than at the turn of the century and retail occupancy cost ratios are very healthy. This leaves plenty of room for rental growth. That's why we're guiding to 3% to 5% growth in both sectors. Investors are taking note of the occupational strength I've just described, and they're increasing their allocation to both offices and retail. This, together with strong credit markets means we expect investment volumes to grow. London office transactions have been subdued in recent years, as we know, but they've really picked up this year with over GBP 6 billion year-to-date and GBP 3 billion under offer. So far, the number of deals over GBP 100 million this year is already double the whole of last year. Strong occupational fundamentals, improving investment markets and our high-quality platform provide for an attractive total return profile. The essential building blocks are set out here. Their earnings yield, valuation uplift and development upside. Earnings yield is currently 5% and growing. Assuming stable property yields, valuations will primarily be driven by ERV growth, where we're guiding to 3% to 5%. You need to adjust for a bit of depreciation, the impact of leverage and the fact that ERV growth doesn't feed through 1:1. But you can see how these first 2 building blocks get you to around 8% to 9%. Developments add further upside with mid-teens returns forecast on the committed schemes and the pipeline. So we're confident in delivering total accounting returns of 8% to 10% through the cycle. The total return outlook is underpinned by attractive earnings growth. We're expecting at least 6% next year, and we have the levers to deliver 3% to 6% over the medium term. This is an ideal point to hand over to David, who will take you through these levers as well as our numbers. David, over to you.

Thanks, Simon. Good morning, everybody. Three things from me today. First, I'll cover our financial performance for the half year. Second, the balance sheet and our approach to capital allocation. And finally, I'll provide an update, as Simon said, on the 5 levers of earnings growth I outlined in May and then how we see them translating into medium-term growth of 3% to 6%, including our guidance for FY '26 and then into FY '27. As you know, we released many of the key metrics in October. That's something you should expect from us going forward. One benefit we see is that it allows us to spend more time today on strategy and outlook, but starting with the numbers. Underlying profit was up 8% to GBP 155 million, and underlying EPS was 15.4p, 1% ahead of last year, meaning the dividend is also up 1%, in line with our policy of paying out 80% of underlying EPS. Looking at the EPS bridge, you can clearly see the benefit of our progress against the earnings levers, in particular, driving like-for-like, which was 4% and contributed GBP 6 million or 0.6p with a positive performance across both offices and retail, higher rents from developments from completed schemes like 1 Broadgate and The Optic, partially offset by void costs and lowering admin costs. This has been a key focus for me since I became CFO this time last year. I spoke in May about the savings we had already identified, and I'm pleased to see the benefit come through in H1 with admin costs down GBP 5 million or 12% versus last year, adding 0.5p to EPS. One-off items had only a limited impact on earnings year-on-year as the positive effect of surrender premium offset bad debt provision releases last year. Taken together then, these positives more than offset the GBP 13 million increase in finance costs, which reduced EPS by 1.3p. This is in line with expectations, mainly reflecting the fact that we're no longer capitalizing interest on completed developments and a 10 basis point increase in our weighted average interest rate to 3.7%. Here's the summary P&L account. I've covered most things here already, but just to touch on 2 further metrics. First, our NRI margin. This was lower due to the increase in PropEx, mainly because of the movement in provisions I just touched on, which slightly flattered the margin last year and void costs as we lease up developments. Once this is done, I expect our margin to stabilize at around 90%. The other thing to draw out here is the EPRA cost ratio, which was 17.4% at September as this higher PropEx more than offset the reduction in admin costs. Though I do expect the ratio to come down to the mid-teens in future years as we lease up developments and further leverage the operating platform we have in place, adding income while controlling costs. Now turning to the balance sheet. NTA has again increased since March, reflecting a 1.2% rise in property values, which added 10p and underlying profit, which added a further 15p, although this was partially offset by the dividend paid in July and other movements, resulting in NTA per share of 579p, up 2%. This, combined with the dividend paid, equated to a total accounting return of 4% for the half, meaning we're on track to deliver our full year target of 8% to 10%. Credit markets remain very strong, and we've capitalized through a broad range of activity focused on maintaining our overall maturity and enhancing diversity in our sources of finance. We raised a GBP 450 million green loan secured against 1 Broadgate, extended GBP 930 million of RCFs and renewed GBP 500 million of term loans at improved pricing. Looking ahead, we have just over GBP 300 million of debt maturities at British Land over the next 12 months. So we remain well financed with flexibility on when and how we raise new debt. And with good access to the bank debt and capital markets, we expect to remain active in a strong market. I was pleased to have our Fitch rating reaffirmed in July at A with a stable outlook, reflecting the fact that our balance sheet remains strong. We ended September with GBP 1.7 billion of undrawn facilities in cash. Net debt was GBP 3.8 billion. Our LTV was 39.1% with net debt-to-EBITDA on a group basis at 7.2x. This balance sheet stability underpins all of our capital allocation decisions. We focus on recycling capital from mature, lower-returning assets into higher returning opportunities. Currently, that means investing further into retail parks where, as Simon has described, the investment case remains compelling, and we continue to see opportunities to buy at attractive pricing. Alongside that, we progress best-in-class office developments at our campuses on a derisked capital-light basis, securing pre-lets, certainty over build costs and bringing in partners to accelerate returns and reduce risk, just as we did over at 2 Finsbury Avenue. Our London Urban Logistics portfolio has embedded development optionality, and we remain positive about the long-term supply-demand dynamics here, so we can progress those schemes when the time is right. But the sector is weaker today. So we prioritize better uses of capital in retail parks and campus development. It's important to note that we always make capital allocation decisions in the context of shareholder distributions, including the relative returns and EPS accretion available from share buybacks, for example, when we have the proceeds to invest following significant disposals. And as ever, all of our capital allocation decisions are based on our assessment of relative returns at any point in time. In May, I set out the 5 levers we focus on to drive consistent cash-generative earnings growth. So 6 months on, let's update against each. First, like-for-like rental growth. We've made a strong start to the year. Portfolio like-for-like growth was 4%, bang in the middle of our guidance of 3% to 5%. Campuses were up 7% as we drove occupancy and secured rental uplifts on space which have been surrendered. Our retail business also continued to grow, albeit at a lower rate, reflecting the fact that we're at near full occupancy. Going forward, though, ERV growth should more directly translate into like-for-like growth as we're largely rack rented now on our parks. And overall, for the full year, I expect 5% like-for-like growth across the portfolio. Kelly will give you more detail on our portfolio performance in a minute. Fee income is our second earnings growth lever. We continue to work with a broad range of JV partners, generating fee income for both assets and development management. Although fee income was flat in the first half at GBP 13 million, we do expect to achieve 10% growth for the full year as we continue to earn fees on development mandates, and we're actively pursuing opportunities to leverage our platform in order to drive incremental fees from new and existing partners. Third, cost control. I'm pleased with the progress we've made over the last 12 months, but this remains a focus. And so for the full year, I expect admin costs to be GBP 75 million to GBP 76 million, ahead of the guidance I gave in May and versus GBP 82 million for last year. Development leasing is our fourth earnings lever. As I mentioned earlier, we're now benefiting from schemes such as 1 Broadgate and The Optic, while leasing on previously delivered schemes at Norton Folgate and Aldgate Place is well on track. 1 Triton Square launched in October, and we're delighted to have our first deals under offer there. Finally, capital recycling. The fuel in this machine is our ability to dispose of lower returning assets, freeing up capital to rapidly redeploy into higher-returning opportunities. As Simon laid out, the office investment market has been quieter than in previous years, but we are seeing signs of improvement. And against that backdrop, we've remained active, executing deals where it makes sense, disposing of retail parks where pricing has moved in or development sites in London, which were not income-producing, then rapidly redeploying the proceeds. Given the improving investment market, we do, however, expect activity to increase over the next 12 to 18 months. Bringing this together, we expect to deliver sustainable EPS growth of between 3% and 6% over the medium term. This slide shows how each of these earnings levers contribute to that. Now this is purposefully illustrative. And of course, it will not be linear in any particular year. But to me, this is the best way to think about the earnings growth potential of our business. So let's go through each of them. In terms of like-for-like, we're confident we can consistently deliver 3% to 5% on our standing portfolio given the strong occupational fundamentals of our core sectors. At the midpoint, this top line of 4% growth drops 3% to 5% annual EPS growth. 10% fee income growth adds another 1% per year. And on costs, I do expect further reductions over the next 12 to 18 months, which will, of course, continue to benefit earnings. Although over the medium term, there is likely to be continued inflationary pressures. So modeling broadly flat costs is not unreasonable over, say, 5 years. Likewise, our weighted average interest rate will gradually increase over time, reflecting prevailing market rates. Based on today's rates, we anticipate a 10 to 20 basis point increase per year, which would reduce EPS by around 2% per annum. So overall, we see a clear route to core EPS growth of 4% per year, and that's before further capital activity, which really is the kicker on top of this core growth. There are 2 components to consider: development completions and asset recycling. And while the timing and phasing of capital activity is, of course, hard to predict and it's by its nature, lumpy, I've assumed around GBP 500 million per year, with GBP 200 million for developments and GBP 300 million for asset recycling. Then to model the earnings impact for developments, we assume a spread of around 200 basis points between the yield on cost and our funding costs and for asset recycling, 100 basis points between what we buy versus what we sell. Taken together then, this capital activity would contribute a further 2% to EPS growth per year, increasing the annual growth rate to 6%, the top end of the range I described in May. So bringing this back to immediate outlook. Moving into the second half, we expect to deliver at least 28.5p of EPS for FY '26 and from there, at least 6% EPS growth for FY '27 as we benefit from the continued lease-up of our developments, capitalize on the compelling fundamentals of our core business and so move forward with confidence in delivering against our 5 earnings growth levers. With that, over to Kelly.

Good morning, everyone. You've heard from Simon on the strength of our markets. So I'll now take you through how that's translated into performance and outline how we're adding value across the portfolio. I'll start with valuations, which have increased by 1.2%. This is the third period I've been able to report positive valuation growth, and it's a good sign that the inflection point is behind us. Valuations have been driven by strong rental growth of 2.4%. On an annualized basis, this is again at the top end of our guided range of 3% to 5%, and we're confident this rental growth will continue. Turning to the operational performance, starting with campuses, we have leased 486,000 square feet at 3% ahead of ERV. And at the end of the period, we were under offer on 629,000 square feet, 6% ahead of ERVs. And we have been particularly busy since 30 September with a further 308,000 square feet put under offer, and that's a very busy 6 weeks. It's worth pointing out, we're seeing particularly strong momentum in leasing up vacancy. Since March, we've let or put under offer 751,000 square feet on vacant or newly delivered space. Our EPRA occupancy now stands at 88%, up 5% this half, up 10% for the year. As we said in the trading update, Broadgate is practically full. There's just one completed floor to lease across the entire campus, and it's an exceptional floor, the top floor of our newest scheme at 1 Broadgate. We're in negotiations on that floor, and we'll set record new rents for the campus. This is good news for our on-site developments, which will deliver into a market with very limited supply. Broadgate Tower is the first to be delivered late next year. This is a 390,000 square foot building with 240 square foot development floors. Since 30 September, we've gone under offer on 59,000 square feet across 5 deals, taking the building to 49% let. This is a very strong position to be in at this stage. The next to deliver is 2 Finsbury Avenue in 2027, where Citadel are taking up to 50% of the space. Here, we are in negotiations with a number of larger occupiers, 2 years ahead of delivery, and this is a fantastic tower building delivering in a year with very little competition. We've also been proactively identifying where we can take that space and relet it at high rents to drive value when there's such little supply. For example, at Exchange House, we proactively took back some floors. We're reinvesting the surrender receipt into much needed on-floor upgrades after 35 years of occupation and have already relet to MSCI, driving rents on by GBP 35 per square foot. This added GBP 10 million to the valuation of the building and sets strong rental evidence for the wider campus. This is accretive asset management, and we will look to do more of this. Norton Folgate is a slightly different proposition for us at British Land as the product is smaller floor space, often fitted and therefore, more suited to let post PC. We've made good progress and are now 89% let, under offer or in negotiations. And we're on track to be fully let by the end of the financial year. Simon covered the growing demand coming from innovation occupiers, which is driving momentum across the portfolio. To capitalize on that, we launched 1 Triton Square last month. This is an incredible building. It's a campus within a campus and offers real flexibility to tenants. It includes a floor of storey space, a floor of fitted labs, 3 lab-enabled floors, which look like a traditional office floor, but can easily be converted to lab use as demand evolves and 3 traditional office floors. You may have picked this up in David's piece, but I'm pleased to confirm that just 6 weeks after PCing, we have 56,000 square feet under offer to 2 globally recognized science and tech occupiers due to complete later this month. And we have another 211,000 square feet in negotiations. We are very excited about this and look forward to continuing to update you on our progress. Turning to retail parks. You'll know it's a very competitive occupational landscape and retailers are keen to secure space. Leasing volumes remain strong at 681,000 square feet, 6% ahead of ERVs. And under offers are 554,000 square feet, also 6% ahead of ERVs. Sales this half have been in line with previous passing rents. And thanks to recent strong rental growth, our portfolio is now largely rented. And as a reminder, it was over 20% over-rented just 2.5 years ago. So we're in a great position to generate strong like-for-like rental growth from the portfolio. Retail parks provide strong cash yields and good opportunities to increase value through asset management. I'll cover just a few of the many examples of asset management on our acquisitions, where we've looked to improve the tenant mix and drive footfall, sales and ultimately, rents. I'll start with the first one we bought when we took the contrarian call to start buying retail parks. When we bought Biggleswade Retail Park in 2021, it had 6 high-risk retailers. These are the ones in red. We've relet all of these to strong category leaders, which has helped drive a 12% IRR since acquisition. Rolling forward to one of last year's buys, Queens Drive Retail Park. When we purchased it, there were 2 vacant units, both are now let, including to an M&S anchor, which is a major win for the park. The park is full and leasing well ahead of ERV and has delivered a 14% IRR since acquisition. And our most recent buy is Turbary Retail Park in Bournemouth, which we purchased earlier this month for a prospective double-digit IRR and a day 1 yield of 7.4%, which with asset management, we've already increased to 7.7%. And we have a strong pipeline of similar deals. As Simon covered, we're unlikely to see many new retail parks built, but we're actively looking for opportunities across the portfolio where we can add space efficiently. Projects like these ones at Glasgow and Rugby are smaller in scale, shorter in duration and lower risk than traditional developments, but they generate meaningful returns with a yield on cost of at least 8%, often double digits. And on top of that, they provide strong wash over to the rest of the park by improving lineup and rental tone. So I'll leave you with 3 things. Values continue to rise, driven by strong ERV growth at the top end of our guidance. Our standing campus assets are virtually full following a strong 6 months of lettings, and we've made good progress on our newly delivered space. And finally, as the market leader in retail parks, our active asset management is pushing on rents and values, and we look to buy more in the space as we continue to recycle capital. Now over to Simon to wrap up.

Thanks, Kelly. So to wrap up, let's circle back to where we began. We're a market leader in the right sectors, campuses and retail parks, where demand is healthy, supply is constrained and rents are affordable. Investors are increasing their allocations to these sectors, and we're very well positioned to capitalize on this and to deliver attractive total returns going forward. Thanks for listening. We're now going to take your questions.

Thank you to the management team for the presentation. We have had a number of questions pre-submitted and submitted live. [Operator Instructions] Our first question is, you expect at least 6% EPS growth from FY '27. What are the key growth levers that will drive that?

Yes. Thank you for that question. So I think I'll just remind you again what our EPS guidance is for this year and next year. So we're guiding to at least 28.5p of EPS for financial year '26. And then going into next year, we're guiding to at least 6% EPS growth. And David mentioned it in the prepared remarks in terms of what the building blocks of that growth look like. So just to remind you in terms of next year, how that will look. So given the strength in our markets that Simon discussed in the presentation with very little supply, very strong demand and rents remaining affordable, we expect to continue to see strong rental growth in those markets, and that should drive through to a strong like-for-like growth. So we expect 3% to 5% like-for-like growth to come through next year, which will kind of -- that will deliver us around 5% of EPS. And then moving down, we would then see fee income. We'd like to grow fee income by about 10%. That will be through existing development mandates that we have with our existing joint venture partners and potentially new mandates as well. That will add around 1% to EPS. Then moving on to cost control. It's something we focused on over the last couple of years. Very pleased to have reduced costs in the first half of the year by GBP 5 million, and we'll continue to look to save costs going forward and expect to save some costs going into the financial year next year. And then offsetting that, you've then got the impact of finance costs. So we're seeing -- we're expecting to see around a 10 to 20 basis points increase in our average cost of debt over next year, which will have around a 2% drag in terms of EPS. So bring those together, that's around 4% of core EPS growth. And then on top of that, you then have capital recycling, so be that selling assets and putting it into new purchases or next year, more likely, it's going to be from the developments that we currently have and are delivering and leasing up those developments into next year, such as 1 Triton Square. So that gets you to the top end of that 3% to 6% range.

Thank you, Sean. Our next question is, are there still retail park opportunities out there? You mentioned buy at attractive prices. How much availability is there?

Yes, that's a very good question and one that we've been asked a lot actually by investors. So we are still seeing good opportunity in retail parks. The environment has definitely become more competitive as investors have realized and kind of seen the strong rental growth we're seeing. There's no new supply. They can buy an attractive yield and you're getting good rental growth on those parks. But we -- given the scale that we have in that market, we are able to identify opportunities where we're willing to take maybe a little bit more occupational risk than some other investors. So for example, Kelly took you through some examples in the presentation today. We would, for example, buy some parks where we know there's some vacant units or there could be a lower covenant tenant on those parks. But given the scale of our parks that we own and the relationships we have with the retailers, we are able to call up retailers before we buy a park and say, how does this trade? Would you like to be on this park? And it gives us an advantage. So we know that we can buy a park and take some occupational risk and fill those void units, change the tenant mix to improve the returns on those parks.

Thank you. Our next question is, your loan-to-value is creeping up. Are you worried about debt risk, especially if property yields move?

Yes. Thank you for that question. I mean our LTV today, as a reminder, is 39.1%. We've said we'd like to operate within a 30% to 40% range. And at this point in the cycle where it seems that values have dropped and are inflecting, we feel comfortable in that 35% to 40% range for LTV. LTV isn't just the only metric we're looking at. We're focused on a range of metrics and also look quite closely at net debt to EBITDA. That was 7.2x for the period, and we would like that to be below 8x. So both of our metrics are below where we'd like them to be, which is good and something we're focused on. And obviously, those are metrics that Fitch are very focused on, and we're keen to maintain the rating we have from Fitch. So yes, so going forward, in terms of looking at leverage, we expect to continue to focus on capital recycling and expect, particularly with values inflecting those metrics to move down over time.

And with funding costs rising, how do you prioritize capital? Is it more developments, repurchases or reducing leverage?

Yes, that's a great question. So in the presentation, David obviously touched on our capital priorities and capital allocation framework as a business. You're right, finance costs have obviously been a factor over the last couple of years, particularly when we're looking at new developments and committing to new developments. So in response to finance costs increasing and our cost of capital increasing, we increased the hurdle rates that we require to commit to a new development scheme. So those have moved up to around 12% to 14% IRRs in terms of committing to new developments. But going forward, we're still seeing very strong returns in our retail parks today. So we're buying those at good yields. You're getting 3% to 5% rental growth given the strong demand that we're seeing from retailers for parks in particular and given the lack of supply. So that's giving you a double-digit IRR, which is ahead of our cost of capital. And for developments, as was mentioned in the presentation, we progress those on a derisked capital-light basis. So we are working with joint venture partners to partner with us on those development schemes, which mean we earn good fee income, which boost the returns and on a risk-adjusted basis, deliver strong returns for the business. So going forward, we obviously are looking at potentially deploying into retail parks and developments. And of course, as was mentioned, those opportunities are always compared against how a share buyback would compare in terms of returns. So we're looking at total return and also EPS growth of a share buyback versus deploying capital into a retail park or a campus development.

Thank you, Sean. And can you expand on what areas you're cutting costs?

Yes. So I'm very pleased that we've continued to focus on cost reduction in the business. So GBP 5 million cost reduction in the first half. Our business is typically 2/3 people costs and then 1/3 of kind of other admin costs, which are typically cost you would expect as a listed company, so audit fees, listing fees, et cetera. So over the period, we've made good cost savings across both of those buckets. And going forward, you would expect to see cost savings align with those 2/3, 1/3 bucket of savings. Very pleased with the activity and expect to continue to focus on cost reductions over the next 12 to 18 months.

And do you see the mix of tenants changing over time?

Yes, that's an interesting question. So I suppose I can look at it in both lenses from kind of looking at our campus operation and also our retail parks. I suppose starting with retail parks since -- over the last few years, we've seen probably quite strong demand from the discounters and grocery tenants. So we've seen very strong demand from the likes of Aldi, Lidl's and other omnichannel retailers likes of likes of Next and M&S. So definitely continue to see those types of occupiers expand on our retail parks. And also now you're seeing lots more -- lots of other leisure operators come on to parks and now you're seeing gym operators come on to the retail parks. You're seeing food and beverage operators come on to parks as well, which is probably different to what you would have seen 10 years ago on a typical retail park. So we'd expect that to continue, and we like to see a diverse range of tenants on our retail parks. And then looking at our campuses. Typically, we're leasing to tenants that are looking for HQ space. So typically, these are large law firms. We're seeing it banking and finance. We have a wide range of tenants on our campuses, including marketing firms, et cetera. What's been interesting actually over the last 6 months or so, we've seen a very strong demand from the tech and AI sector. So at the moment, we're tracking 1.5 million square feet of demand from that sector. And interestingly, that's more often than new demand, so expansionary space. So I think going forward over the next 24 months or so, you should probably expect to see some more deals with those tech and AI companies on our campuses as that's where there is a large pool of demand today.