LondonMetric Property, a warehouse landlord, has ascended to the ranks of the FTSE 100, joining its larger competitor Segro in this prestigious index, marking a significant transformation in the commercial property sector over the past decade.
This elevation of LondonMetric to the FTSE 100, alongside Vistry (formerly known as Bovis Homes) and Darktrace, the cybersecurity firm, reflects a reshuffling of the FTSE indices. Conversely, Ocado, St James’s Place (a wealth manager), and RS Components (an electrical components maker) have been demoted.
LondonMetric's rise to the FTSE 100 is led by its CEO, Andrew Jones, who founded the company in 2013. Formerly the head of retail at British Land, Jones steered LondonMetric away from office and retail properties, which faced skepticism from investors regarding their valuations. British Land, once a stalwart of the FTSE 100, experienced a decline in share value, trading at a significant discount to its net tangible asset value.
In contrast, LondonMetric, currently valued at £4.19 billion, has garnered investor confidence, trading at a premium to its net tangible asset value. Jones attributes this success to the company's strategic pivot towards warehouses and student properties, with industrial property now constituting 43 percent of its portfolio by value.
Earlier this year, the company completed an all-share merger with LXi REIT, following its acquisition of A&J Mucklow in 2019. Ocado's demotion from the FTSE 100 was anticipated, given its mounting losses as it expands its robotic grocery packer-equipped warehouses. Last year, Ocado reported a pre-tax loss of £403 million, prompting its exit from the blue-chip index.
