SEGRO has opened 2026 on a firm footing, contracting £23m of new headline rent in the first quarter and pushing ahead with its data centre ambitions despite a choppier geopolitical backdrop.
Of the £23m signed, £11m came from the existing portfolio as vacant space was leased and reversion captured, with the remaining £12m from development lettings. UK rent reviews, renewals and regears delivered a standout 38% uplift, pulling the group average to 19% and highlighting the mark-to-market rent still sitting in the portfolio.
Customer retention held at 83% and occupancy was broadly stable at 94.8%, helped by vacancy reductions in London and speculative completions in Germany, where multiple lease negotiations are now underway.
Development activity remains a key growth lever. Schemes under construction or in advanced negotiation represent £73m of potential rent at a 7.6% yield, with two-thirds already pre-let.
SEGRO reiterated its £450m–£550m development capex guidance for the year. Completions in Q1 totalled 40,000 sq m, generating £4m of headline rent, 37% of which is leased, a slightly lower mix reflecting the weighting towards urban speculative schemes.
Like its peer, British Land, which also recently provided an update, SEGRO is becoming an indirect beneficiary of the rapid expansion of AI through growing demand for office and warehouse space by companies operating in the sector.
In terms of new data centre leases, SEGRO has signed a 30,000 sq m powered shell pre-let on the Slough Trading Estate, secured planning for its first fully fitted 56MW data centre in West London, and is progressing power upgrades in Slough.
Capital recycling continues to fund future growth, with £106m of disposals completed at a premium to book value and a further £138m to be exchanged later in the year.