Cadogan announces 2023 Annual Results
Strong operational performance, new lettings and focus on community drive continued outperformance in Chelsea.
Highlights include:
+ Operational profits up by nearly a quarter, driven by substantial investment and healthy demand across the portfolio
+ Significant progress towards environmental and community objectives, including £90m decarbonisation programme, 13.1% increase in urban greening factor and over £4m community funding, in addition to the launch of a new Community Grants Programme
+ Robust trading and strong demand in retail and hospitality, with retail performance surpassing pre-pandemic levels
+ Completion of £235million mixed-use scheme The Gaumont; commencement of Sloane Street transformation and opening of At Sloane, Cadogan’s fifth directly owned hotel
Cadogan today announces growth in operating profits of 22.2%, as retail spending and strong footfall continue to drive capital growth across Chelsea, resulting from long-term investment in placemaking and community support.
Total income grew by 15.8% to £216.0m (2022: £186.5m), while the property portfolio value increased by 3% to £5.4bn (2022: £5.1bn). A record £231m was deployed into acquisitions and developments as part of Cadogan’s long-term approach to ensure Chelsea retains its resilience and enduring appeal.
Delivering results through long-term investment
As a long-term, family-owned property business with a concentration of ownership over 93 acres of Chelsea, Cadogan is able to maximise the area’s long-term prosperity by taking decisions that yield financial results over very many years. Careful curation of independent retailers and world-class brands; increased focus on food and drink and new boutique luxury hotel openings together with the delivery of beautiful public spaces, has contributed to the success of Chelsea.
Footfall has proved strong, supporting consumer spending despite wider economic challenges and ultimately leading to healthy demand for shops and restaurants. This has resulted in excellent rental growth underpinned by the continued success of occupiers, with retailers reporting revenues 10% higher than 2019.
The last 12 months have proved to be a successful year for Cadogan, marked by several major developments with the company investing £231m (2022: £89m). 2023 highlights include:
+ The completion of two of Cadogan’s largest developments:
~ The Gaumont, a £225m mixed-use project comprising seven different use classes – a Curzon cinema, Waitrose, flagship retail units, high-quality offices, ‘creative quarter’ community shops, a rooftop bar and 47 residential flats (including affordable housing). The development will also feature a significant public art installation set to be unveiled in early 2025
~ At Sloane, Chelsea’s newest and most fashionable luxury hotel, operated by the fêted French hotelier Jean-Louis Costes, offering a basement bar and rooftop restaurant
+ Significant investment in the hotel sector was also marked by the opening of The Chelsea Townhouse, following an extensive refurbishment
+ Commencement of the £46m Sloane Street public realm project to create a leafy, tree-lined boulevard spanning from Knightsbridge to Sloane Square and due for completion end of 2024, to enhance the environment and further ensure Chelsea remains Europe’s luxury capital
+ Improved retail and food & drink offer with over 60 new brands, upsizes and renewals. Sloane Street welcomed restaurants including Azzurra and Cantinetta Antinori and experienced significant store upsizes from Christian Dior, Yves Saint Laurent and Valentino. Chelsea also saw flagship openings including The Conran Shop, Varley, PAIGE and Klattermusen
Contributing towards a sustainable and thriving local community
Contributing towards a flourishing and sustainable community is central to Cadogan’s strategy and purpose, evidenced by the ambitious environmental and social targets set out in ‘Chelsea 2030’.
2023 resulted in:
+ Over £4m invested in community and charitable projects, including £1.1million towards subsidised affordable, community and key worker housing and extensive skills and training opportunities for the local community
+ Cadogan’s philanthropic partner, The Kensington & Chelsea Foundation, reached over 21,000 disadvantaged and vulnerable people through 143 local grassroots projects. 2024 will see the launch of an additional Community Grants Programme to directly support local projects
+ A new ‘creative cluster’ of small independent spaces created on Chelsea Manor Street, following the success of Pavilion Road. An extensive local consultation identified a clear local desire for uses such as music, art and literature alongside a pub to host live events, reflecting Chelsea’s rich heritage of art, music and cultural innovation
+ Over 60 community focused events, notably Chelsea in Bloom (coinciding with the world-famous Chelsea Flower Show) which recorded the highest ever neighbourhood footfall, the King’s Road Coronation Party, Summer in Sloane Square and the Chelsea Christmas Campaign attracting thousands of visitors
Achieving Net Zero remains a top environmental priority and throughout 2023 Cadogan continued to deploy funds from its £90m decarbonisation programme to reduce carbon emissions by procuring low carbon energy, retrofitting and refurbishing buildings, reducing construction waste and choosing lower carbon construction materials and techniques. Other environmental highlights over the past year include:
+ 98% of construction waste recycled or reused
+ 54% operational waste recycling rate (vs 47% in 2022)
+ 7% reduction in energy use intensity, from the baseline
+ 13.1% increase in Urban Greening Factor from the baseline, in addition to further projects to increase biodiversity such as additional natural ponds, beehives and extensive rooftop greening, notably on The Gaumont development
Hugh Seaborn, Chief Executive, Cadogan, commented: “It has been a very good year for Cadogan, and I am delighted that 2023 has resulted in strong performance across all three pillars of the business spanning financial performance, progress with our ambitious sustainability strategy and delivering community support. The excellent financial results, including a 22% increase in operating profit, have allowed us to reinforce our clear purpose beyond profit. This is driven by enlightened self-interest – if we are to prosper over the long-term, we need to ensure Chelsea remains vital and healthy as a place to live, visit and do business. Therefore, our strategy places the community at its heart and is central to our investment decisions and estate management initiatives.”