Estate agent Savills sees profits rise to £100m despite Brexit hit to UK sales
Profits at Savills edged up last year, despite the upmarket estate agent flagging a Brexit hit to UK sales at both its residential and commercial units.
The company said pre-tax profit in the year to December 31 rose 1% to £100 million, helped by a strong performance in continental Europe and China.
Group revenue rose 13% to £1.4 billion, with chief executive Jeremy Helsby hailing a "record performance in 2016 despite the geopolitical distractions".
But Savills also laid bare the impact of the Brexit vote on London, with the estate agent booking a 3% fall in revenue at its UK residential arm to 124.4 million, and contract exchanges falling 5% in the capital.
Savills added that revenue from UK commercial transactions decreased 13% to £86 million against a backdrop of an overall 28% fall in investment volumes.
However, it added that the collapse in the value of the pound helped mitigate the impact, with the top end of the residential market getting a boost and foreign buyers piling into the commercial market.
Savills said: "The weakness of sterling after the Brexit referendum began to catalyse international investor interest over the summer, although there being little distress among owners, there was a significant mismatch between demand and supply of stock.
"Since then, a large majority of the stock traded, particularly in central London, has been acquired by overseas investors, particularly from Asia Pacific and the Middle East."
The central London leasing market also saw a 21% reduction in the take-up of City offices, while the vacancy rate in the Square Mile rose to 5.7% against as rents continued to increase.
Mr Helsby added: "We entered 2017 with a continuation of global macro-economic concerns, rising bond yields, uncertainty over the impact of Brexit negotiations in the UK and continental Europe and a new administration in the US.
"Savills is a strong and diverse global firm and we continue to look at opportunities to develop our business. We have started the year well and our expectations for the full year remain unchanged."