Derwent London Plc
Derwent London Plc owns a commercial real estate portfolio predominantly in central London valued at 5.0 billion pounds as at 30 June 2026, making it the largest London office-focused real estate investment trust (REIT). Their experienced team has a long track record of creating value throughout th…
Derwent London Plc owns a commercial real estate portfolio predominantly in central London valued at 5.0 billion pounds as at 30 June 2026, making it the largest London office-focused real estate investment trust (REIT). Their experienced team has a long track record of creating value throughout the property cycle by regenerating buildings via redevelopment or refurbishment, effective asset management and capital recycling. The firm typically acquires central London properties off market with low capital values and modest rents in improving locations, most of which are either in the West End or City Borders. They capitalize on the unique qualities of each of their properties " taking a fresh approach to the regeneration of every building with a focus on anticipating tenant requirements and an emphasis on design. Reflecting and supporting their long-term success, the business has a strong balance sheet with modest leverage, a robust income stream and flexible financing. They are frequently recognized in industry awards for the quality, design and innovation of our projects. Landmark buildings in their 5.2 million sq ft portfolio include 25 Baker Street W1, 1 Soho Place W1, 80 Charlotte Street W1, Brunel Building W2, White Collar Factory EC1, Angel Building EC1 and Tea Building E1. As part of commitment to lead the industry in mitigating climate change, Derwent London has committed to becoming a net zero carbon business by 2030, with its updated pathway published in 2025. Their science-based carbon targets have been validated by the Science Based Targets initiative (SBTi). In 2013, the firm launched a voluntary Community Fund which to date has supported 200 community projects in central London. Derwent London Plc is a public limited company and incorporated and domiciled in the UK. The address of its registered office is 25 Savile Row, London, W1S 2ER.Priced within the modelled range
5-year outlook: Not shown because confidence is low: Earnings-based DCF agrees.
Other models: GBP 9.95–21.91 (median 16.86). The recommended value is in line with them.
Why: Free cash flow is positive and in line with earnings, and the dividend is small, so a cash-flow DCF fits best.
Details and the full model are below.
Market price within modeled range
Free-cash-flow DCF using Fiscal year 2025 reported free cash flow, with cash, debt, and shares from the latest report. Base assumptions are 3.67% growth, 2.3% terminal growth, and 9% discount. Low/high cases vary growth by 2 and terminal growth/discount by 1 percentage point; this illustrative range is not a statistical confidence interval or investment advice.
Assumptions: growth 3.67%, discount rate 9%, terminal growth 2.30% (sector defaults). See a worked example.
Blended growth assumption: 3.7% (sector default 5.1%, own revenue history 12.8%, analyst revenue consensus -1.6%).
Analyst consensus expects revenue growth of -1.6% a year; the growth assumption used is 3.7%.
Adjust assumptions
Why this model: Free cash flow is positive and in line with earnings, and the dividend is small, so a cash-flow DCF fits best.
Compare models- Recommended: Free-cash-flow DCF — GBP 18.66 (-4.7%)
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EPS-based Gordon proxy
— GBP 21.91 (+12.0%)
Not used: Treats all earnings as if paid out and ignores the cash kept for reinvestment, so it overstates value for companies that retain most profit.
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DCF (trailing free cash flow)
— GBP 18.66 (-4.7%)
Not used: Not chosen: Free-cash-flow DCF ranks ahead of it for this company.
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FCFF (steady state)
— GBP 16.86 (-13.9%)
Not used: Assumes only the long-run terminal growth rate from today, so it ignores the near-term growth expected.
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EV/EBITDA (12x)
— GBP 9.95 (-49.1%)
Not used: Used only when free cash flow is far below earnings even after averaging three years; a fixed 12x multiple also ignores sector differences.
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Fade DCF (10-year growth fade)
— GBP 18.59 (-5.0%)
Not used: An alternative growth path (fading over 10 years) shown for comparison; the automatic choice does not use it.
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EV/Sales (Rule of 40)
— GBP 27.66 (+41.3%)
Not used: Used only for technology and communication companies whose cash-flow value is far below the price.
| Bear GBP 10.17 | -92.4% |
| Base GBP 18.66 | -4.9% |
| Bull GBP 34.58 | 43.4% |
Margin = (value − price) / value, so it is measured against the value and reads lower than the upside to value, which is measured against the price. Positive means the price is below that case.
At GBP 19.57 the market implies about this annual free-cash-flow growth for 5 years (terminal 2.3%, discount 9.0%).
Compare: the market implies 4.3% a year, this model assumes 3.7%. The market expects more than this model does, which is why it reads as overvalued.
How the Free-cash-flow DCF value changes with growth (rows) and discount rate (columns). Green cells are above the current price.
| Growth \ Discount | 7.0% | 8.0% | 9.0% | 10.0% | 11.0% |
|---|---|---|---|---|---|
| -0.3% | 24.74 | 18.22 | 13.64 | 10.26 | 7.65 |
| 1.7% | 28.30 | 21.10 | 16.06 | 12.32 | 9.45 |
| 3.7% | 32.13 | 24.21 | 18.66 | 14.55 | 11.38 |
| 5.7% | 36.27 | 27.56 | 21.45 | 16.93 | 13.46 |
| 7.7% | 40.71 | 31.15 | 24.45 | 19.50 | 15.68 |
Track record: see the methodology page for how this model has performed historically, including its limits. Treat it as a screen, not a forecast.
Price history and fair value
No chartable saved daily price history is available for this range. The chart uses stored EODHD prices only and will appear after history is saved.
More detail: quality, peers, price history, dividends and financials
Quality score: 60 / 100
Five equal checks on reported history: profitability, cash generation, revenue growth, balance sheet and margins. It describes business quality, not whether the price is attractive.
| Profitability | 3 of 5 years profitable | 12 / 20 |
| Cash generation | free cash flow positive in 2 of 5 years | 8 / 20 |
| Growth | revenue +12.8% a year | 20 / 20 |
| Balance sheet | net debt 6.8x EBITDA | 0 / 20 |
| Margins | EBITDA margin 55% | 20 / 20 |
Peers in Real Estate
Same-sector companies with a valuation, most undervalued first. Compare the margin of safety, yield and quality score side by side.
| Company | Price | Margin of safety | P/E | P/B | Yield | Quality |
|---|---|---|---|---|---|---|
| DLN.L (this company) | GBP 19.57 | -4.9% | 13.6 | 0.6 | 4.1% | 60 |
| HST Host Hotels & Resorts | USD 24.63 | 44.2% | 16.4 | 2.6 | 3.9% | 100 |
| ARE Alexandria Real Estate Equities | USD 45.17 | 23.7% | – | 0.5 | 7.8% | 44 |
| VMRK Vivmark Residential | USD 65.25 | 22.5% | 28.6 | 2.4 | 4.2% | 82 |
| UDR UDR, Inc. | USD 37.01 | 8.2% | 17.2 | 3.8 | 7.1% | 82 |
| VICI Vici Properties | USD 25.21 | 6.2% | 11.8 | 1.0 | 7.0% | 80 |
| UTG.L Unite Group PLC | GBP 4.95 | -3.3% | 24.9 | 0.5 | 6.3% | 68 |
| WDP.BR Warehouses De Pauw SA | EUR 19.33 | -5.5% | 11.9 | 0.9 | 6.2% | 80 |
| DOC Healthpeak Properties | USD 20.12 | -7.6% | 35.7 | 1.8 | 6.1% | 76 |
| Peer median | 17.2 | 1.4 | ||||
Dividends
Paid in the last 12 months: GBP 0.01 per share · yield 0.04% at the current price.
| Year | Dividends per share |
|---|---|
| 2026 (so far) | 0.008 |
| 2025 | 0.008 |
| 2024 | 0.008 |
| 2023 | 0.008 |
| 2022 | 0.008 |
| 2021 | 0.008 |
Annual financial statement
Saved annual report · Fiscal year 2025 · EODHD annual statements · period ended 31 Dec 2025
| Revenue | GBP 388,700,000 |
|---|---|
| EBITDA | GBP 212,800,000 |
| EBIT | GBP 212,000,000 |
| Net income | GBP 161,100,000 |
| Free cash flow | GBP 218,000,000 |
| Capital expenditures | GBP 10,000,000 |
| Debt | GBP 1,568,100,000 |
| Cash | GBP 131,699,999 |
| Working capital | GBP -94,300,001 |
| Shares outstanding | 112,254,000 |
| Reported dividends per share | GBP 0.8089 |