The offices owner posted a GBP110mln loss before tax for the six months to September 30, 2020, a reversal from a GBP99mln profit a year ago.
The group’s portfolio valuation at that date was GBP2.4bn, down 5% from March 31, 2020, while its net tangible assets per share (EPRA) were 8% lower at GBP10.05.
Like-for-like occupancy declined by 8% to 85.5%, rent per square foot dipped 3% to GBP40.61 and like-for-like rent roll was down 12% to GBP98.8mln.
The FTSE 250 firm said it has collected 95% of rents due for the first half, net of discounts and deferrals, as of November 2.
The office owner said trading improved after coronavirus (COVID-19) restrictions were eased in the run-up to last month, however, the performance is very sensitive to COVID-19 and government measures.
In its forecast scenarios, a 5% change in occupancy will cost around GBP7mln and increase void costs by around GBP2mln, while a 5% change in rent per square foot would hit rent roll by GBP6mln.
Performance in the second half of the year will be driven by a combination of the reduction in income from customers that vacated during the first half, existing customers downsizing and vacating in the upcoming months and new customer demand, the group said.
“We continue to believe in the longer-term attractions of the Workspace flexible business model, but operational performance will clearly take some time to recover to pre-lockdown levels,” analysts at Liberum Capital said in a note to clients.
“We do not think that key covenants are at risk and the decision to review the dividend provides the company with flexibility to retain cash within the business,” they added.
Workspace shares dipped by 2% to 738p on Wednesday morning.