Songbird Estates faces a multi-million pound bill for two recent setbacks, including the recent car-melting skyscraper.
The property group reported a 6% rise in half year net assets per share, but told Reuters its Canary Wharf subsidiary would pay a sum in the "low single digits" to fix the Walkie Talkie building in the City of London. Rechristened the Walkie Scorchie, the building's concave structure reflected sunlight to such an extent the heat melted parts of a car, a bicycle and was also used to fry an egg.
Songbird also faces a £1m to £2m bill for a delay to its proposed development of Royal Dutch Shell's headquarters in London, after the government said it would review planning approval given by local authorities.
The problems have not undermined Songbird's shares, which have flown 4.75p higher to 156p. Peel Hunt said:
Songbird reports very strong first half net asset value growth driven by a portfolio that is 100% London, 95% occupied, long-let (13 years to break) and well positioned for a recovery in the City lettings market. The corporate structure is far from ideal, but with the shares trading on a 34% discount – one of the largest in the sector – we retain our buy rating and increase our target price.
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