SEGRO Plc

D. Sleath: Okay. Good morning, everybody. And great to see so many people here on a Friday in half term week. So whether you are here in the room with us or joining us online, we're absolutely delighted to have you with us as we present SEGRO's 2025 full year results. I'm joined here by a number of my executive colleagues, and I'd particularly like to welcome Susanne Schroeter, who is presenting her first set of results after joining us only in December. Before getting into the detail, what I'd like to do is share some key messages with you, set the scene as it were and explain why we are confident about the future. And I should just mention, our presentation is going to run a little bit longer than normal today because there's a lot we want to talk about, particularly to give more color on our data center strategy and set out the -- what we think is a really exceptional opportunity for this part of our business. So 2025 actually turned out to be a very strong year for SEGRO, both operationally and in financial terms as well despite the rather challenging macro. We signed a record GBP 99 million of new headline rent, including GBP 33 million of development signings. Within our existing portfolio, we delivered GBP 37 million of reversion uplifts from lease renewals and rent reviews, which itself was a key driver of our 6% growth in like-for-like net rental income. All of this translated into a 6% increase in adjusted earnings per share and a 2% growth in adjusted NAV per share. So a strong set of financial outcomes. But what pleased me most about 2025 was the improving occupier sentiment and a pickup in deal activity in the second half of the year as the structural drivers underpinning demand for our assets began to reassert themselves. That momentum has continued into 2026. Inquiry levels right now are strong. Occupiers are starting to progress their investment plans, and we have an active pipeline of discussions both on existing space and for new pre-lets. We know that deals can take a long time to convert from active interest into actual signed deals. And no one quite knows how 2026 will turn out in terms of geopolitics. But we're really pleased and very well positioned right now, and it feels much more encouraging here today than it has at any time for at least the last 2 years. Those results added to our long-term track record of delivering compounding annual growth driven by disciplined capital allocation, operational excellence and an efficient capital structure. Since 2016, we've delivered an average 8% growth in earnings, dividends and net asset values despite the more challenging environment of the last couple of years. And we anticipate that improving market fundamentals and the exceptional opportunities in front of us will enable us to move back towards those longer-term averages. Onside our financial and operational achievements in 2025, we progressed our responsible SEGRO strategy. We continue to champion low-carbon growth, reducing our carbon intensity significantly and have refreshed our net zero targets, which have been approved by the science-based targets initiative. We added to our community investment plan framework. We achieved record levels of volunteering by our employees, customers and stakeholders, and we delivered 54 community projects. We also continued investing in our people to further strengthen our market-leading operating platform through our nurturing talent strategy. These initiatives are a really important part of how we sustain high performance across the business and ensure that we continue building for the future. So let's now get into some detail. We'll start with our strong financial performance presented by Susanne. Then we'll talk about the strong operating performance behind these results. James Craddock and Marco Simonetti will address the U.K. and the Continental European markets, respectively, after which I'll bring it all together to give you a group overview. And then we'll finish by looking at the future opportunity for SEGRO, which I'll address in 2 parts. Firstly, the multiple levers we have to drive growth within our industrial and logistics business. And then secondly, the compelling opportunity that we have within our exceptional data center pipeline. So now I'm delighted to hand over to Susanne. Susanne Schroeter-Crossan: Thank you, David, and good morning also from my side. I had a fantastic start to SEGRO so far. The team has been extremely welcoming and supportive. And I've also already had the chance to visit a number of the offices and assets across London, Midlands, Germany, Netherlands and France. And I must say what I've seen so far has really impressed me both in terms of the quality of the assets and the strength of the team. So I'm very excited about the opportunities ahead and as I continue to get to know the business better. About 2025. While I can't take credit for the excellent performance the team has delivered in 2025, I'm very happy to talk you through the key numbers. 2025 was defined by strong operational execution across the portfolio. We also continued with our balance sheet discipline, and we saw improving momentum in our key markets. This was reflected in the key financial metrics. Adjusted earnings per share increased by 6.1%, and this was driven by higher net rental income and continued cost discipline. We have chosen to pay a full year dividend of 31.1p, which also represents a 6.1% increase year-on-year. Portfolio valuation grew by 1% on a like-for-like basis, and this was the first year that both the U.K. and Continental Europe have been positive since the start of 2022. Adjusted NAV per share increased by 2%, and that reflects the like-for-like valuation uplift and additions we made to the portfolio throughout the year. Our balance sheet remains strong. Loan-to-value ended the year at 31% and net debt-to-EBITDA reduced from 8.6 to 8.4x over the course of the year. Let us now turn to the income statement. Net rental income grew by 8.6%. I will tell you more about this on the next slide. Net interest costs were stable year-on-year. Lower gross interest was offset by lower capitalized interest. And the reduction in gross interest came from lower interest rates, particularly Euribor, which offset the higher net debt figure. Our EPRA cost ratio improved slightly in 2025, and this was also helped by a EUR 3 million reduction in administrative expenses. Operational efficiency will remain a focus going forward. Adjusted profit before tax increased by 8.3%. And to summarize, this performance demonstrates the resilience of our operating model and the quality of our portfolio. Let's now look at net rental income in more detail. We delivered EUR 47 million of net rental income growth, and that was driven by 4 factors: number one, the 6% like-for-like rental growth, which was strong both in the U.K. and Continental Europe. The U.K. performance was driven by capture of reversion at the 5 yearly rent reviews and Continental Europe benefited from increased occupancy and asset management initiatives. Number two, development completions. These contributed EUR 31 million last year. Number three, acquisitions and disposals. The impact of those 2 was neutral due to the sales we did in 2025 and the full year effect of the 2024 disposals. Number four, the other items, these include mainly takebacks for redevelopment, surrender premiums and also some FX impact. We expect like-for-like rental growth to remain strong as we continue to capture reversion to lease vacant space and that we continue our active asset management. As I said before, 2025 was the first year since the pandemic where both the U.K. and Continental Europe saw positive valuation movements and the total portfolio value increased by 1% on a like-for-like basis. Yields were broadly stable during that period. ERV growth for the group was 2.3%. It was stronger in the U.K. at 3.1%, driven by a standout performance from our West London portfolio, which delivered 4.7% growth. In Continental Europe, it was 1% overall. Spain and Germany outperformed and delivered the strongest growth at 3.2% and 2.4%, respectively. The portfolio now stands at EUR 19 billion at share, including our development assets and land holdings. The equivalent yield is 5.5%. Our balance sheet remains strong. The LTV is at 31%, which is a level that we are currently comfortable with. Net debt-to-EBITDA stands at 8.4x, down from 8.6x last year, and that reflects higher EBITDA and disciplined capital management. We continue to benefit from a diverse and long-term debt structure. Our average maturity is 6 years. We have undrawn RCFs and term loans of circa EUR 1.9 billion and ongoing access to attractive financing through the euro and sterling bond markets, also the private placement and bank markets. Our EUR 650 million bond maturity in March will be refinanced through an undrawn term loan that we have signed in the second half of 2025 and the residual amount will be drawn from our RCF. This robust financing position gives us the flexibility to invest through the cycle and capture future opportunities. Now let us talk about capital allocation. Our capital allocation framework remains clear, disciplined and aligned to long-term shareholder value. Development on existing land remains our most accretive use of capital. It yields 7% to 8% on total costs and 10% or more based on additional capital required. We expect 2026 development CapEx to be in the EUR 450 million to EUR 550 million range. And the final number will depend on the level of new projects we start in the next few months. Our CapEx guidance includes about EUR 150 million of infrastructure investment to support the long-term growth from our logistics parks in the U.K. and for power upgrades for our data center pipeline. We will remain very selective on acquisitions. We focus only on the most compelling opportunities in core markets that provide wider portfolio benefits and attractive returns. We do consider additional distributions to shareholders such as share buybacks, but only when we believe that we have material surplus capital and the lack of compelling development and acquisition opportunities. This is currently not the case, especially given the momentum building in our development pipeline. We continue to take an active approach to capital recycling, and we have an annual planning process to identify assets where we have optimized returns. With the current cost of capital, we continue to be very disciplined when it comes to capital deployment for new investments, but also for the assets that we retain. We, therefore, expect disposals this year to be at or above the upper end of our longer-term run rate of 1% to 2% of our portfolio. These disposals will generate proceeds that we can invest into opportunities with higher risk-adjusted returns. In addition to disposals, we are regularly considering options to fund our growth pipeline. We also have a successful track record of working with partners to share capital intensity, for example, within our SELP joint venture and now also with Pure on our first fully fitted data center joint venture. This capital allocation framework work continues to support both the near-term delivery and our long-term returns. To summarize this section, in 2025, we delivered a strong 6% like-for-like rental growth, contributing to 6% earnings and dividend growth. We have a strong balance sheet and a clear disciplined capital allocation strategy aligned to long-term shareholder value creation. Let's now turn to the operational performance of the business, and I'm delighted to hand it over to James, who will start with the U.K. James Craddock: Thank you, Susanne, and good morning, everyone. So let me start by talking about the broader U.K. market. So 2025 was the strongest year for logistics take-up since the pandemic. There was about 33 million square feet of logistics occupational activity. Pre-let activity did remain low, however, and take-up was driven more by immediate needs of customers rather than the more strategically planned decision-making. On the supply side, we've seen things stabilize, and there are encouraging signs of positive net absorption in some markets, which is resulting in vacancy nudging down, and we've seen this in our own portfolio, both in the urban and in the big box markets. In terms of overall logistics supply in the U.K., it's important to note that about 2/3 of the supply is of second-hand or poorer quality stock. So this continues to favor owners of prime, modern, well-located portfolios like our own. New speculative development starts have fallen materially. They're running at roughly half the long-term averages, and 3PLs are reporting low levels of gray space within their portfolio, both of which are supportive factors as we look ahead. That said, the market is far from uniform. There were areas of real strength and other areas that remained weaker in 2025. If we turn now to our own portfolio, pre-let levels were low, but we were able to sign a fantastic deal for development on our food campus at SEGRO SmartParc in Derby. We also leased 1 of our 2 speculatively developed sheds at SEGRO Park Coventry, which helped to improve our U.K. occupancy by 50 basis points to 93.1%. We've also been doing some selective speculative development, which included the development -- redevelopment on the Slough Trading Estate, which has been leasing well. For me, however, the highlight of the year was the standout asset management performance and standing stock leasings with the teams completing on over 250 individual transactions across leasing, rent reviews and lease renewals. Our key urban markets, especially the highly established Heathrow and Park Royal, which together make up 40% of our U.K. portfolio continue to perform well. This is driven by good demand and the depth of our customer relationships. Transactions have included setting new headline rents to customer segments, including food and beverage, 3PL and pharmaceuticals in these submarkets. This activity demonstrates the continued attraction of prime urban markets for occupiers who are providing value-add goods and services who need to remain located within prime M25 locations to service their end customers and to attract labor. A major focus for us in 2025 was also preparing our very special U.K. logistics sites for future development, which included hitting key milestones with the groundworks and the strategic rail freight interchange development at SEGRO Park Radlett. We, therefore, now have 3 sites in construction-ready status and the first plots at Radlett will also be ready in the early part of next year. Between them, these can deliver over 9 million square feet of the very best modern logistics space in the U.K., ensuring that we can respond quickly as occupier demand continues to build. On that topic, over the past 2 to 3 months, inquiry levels have improved materially across both logistics and urban, and we are seeing more activity across a broader mix of occupiers. This is largely being driven by the structural drivers which support our business. Retailers, food, e-commerce and general distribution are particularly active, seeking efficiencies through supply chain optimization, which is driving decision-making. Taken together, these trends give us confidence in the outlook for the U.K. business and the pickup in inquiry levels and leasing activity since the budget, both on standing stock and for pre-let opportunities provides a solid foundation for 2026. I'll now hand over to Marco, who will talk you through the performance in Continental Europe. Marco Simonetti: Thank you, James, and good morning all. Let's move now to Continental Europe. And I would like to cover 4 points: share some key highlights on the overall occupational market, then cover the performance of our existing portfolio, then move into the development pipeline and finally touch on that outlook for 2026. Starting with the overall occupational market. Leasing activity in 2025 has outperformed the pre-pandemic average. In fact, Q4 was the strongest quarter of take-up in 3 years. Vacancy rates now have stabilized with early indication of a modest downward trend and new speculative development are limited to a few prime locations. Similar to the U.K., the European market is in uniform and some countries and some regions within countries have performed better than others. Our exposure to the best-performing markets has contributed to a strong performance with a clear momentum in the second part of the year, both on the existing portfolio and on the development side. Our existing portfolio has performed extremely well. We signed over 180 deals. We had a strong letting activity and high customer retention, bringing occupancy to 98% across the continent with some countries fully occupied. We completed several notable letting transaction above 30,000 square meters like ID Logistics in South of France, GD.com in Germany, GXO in Milan or H&M in Poland. Moving now to the development side. Structural trends, including urbanization, e-commerce growth and the supply chain organization led to an exceptional quarter 3 and quarter 4 from a development side. In fact, H2 2025 was the best half year ever in Continental Europe for SEGRO, outperforming even the pandemic years. We saw the return of large pre-lets. We signed 9 deals equating to over 300,000 square meters of space, a pre-let to GXO in the south of Paris, a fulfillment center for e-commerce player in Germany, the new distribution facility for Primark in Italy as well as multiple smaller deals across Germany, Italy, Spain and Poland. The leasing activity was strong on our speculative program as well with our schemes in Germany, in Spain and Poland, all hitting a high level of occupancy before completion. And in the case of Warsaw, we have been able to fully let the space even before starting construction. So in summary, 2025 was a strong year for SEGRO in Continental Europe. Now looking forward, we enter the year in a stronger position than this time last year. Many of our 2026 lease events have already been secured. We have a healthy development pipeline, partially pre-let and partially spec with some projects in the near-term pipeline already signed in Spain, in France and in Poland, waiting just for the building permit. And we continue to see a good progress in our speculative German urban schemes. And with that, I will hand back to David. D. Sleath: Thank you very much, Marco and James, and indeed, Susanne. So as you heard, actually 2025 was a very strong year of deal execution for SEGRO. In total, we signed GBP 99 million of new headline rent, which is the highest in our history and even, as you can see, slightly higher than the pandemic peak of 2022. So this reflects strong performance across both existing assets, which is the part shown in red, led by the U.K. and with our development program, which is shown in salmon pink, which is led by the continent. As Marco and James both commented, though, activity levels strengthened noticeably in the second half of the year, and that momentum has continued into 2026. It was an excellent year for reversion capture, demonstrating the quality of our portfolio, the strength of our diverse customer base and the impressive skills of our leasing and asset management teams. Overall, we achieved a 36% uplift on rent reviews and renewals, which was 46% on average in the U.K. Despite these higher rents, we also maintained a high 82% customer retention at break or lease expiry, and we increased our overall occupancy by 90 basis points to 94.9%, driven mostly by Continental Europe, but also with some progress in the U.K. We continue to take a disciplined approach to capital allocation, as Susanne highlighted earlier. Whilst capital deployment into development is our priority, we always remain alert to opportunities to acquire good quality assets that offer attractive returns in our high conviction markets. Such was the case in Germany and the Netherlands with the acquisition by our SELP JV of some excellent assets formerly owned by Tritax EuroBox and in the case of a smaller logistics park close to Prague. Following a big year of disposals in 2024, we carried out fewer asset sales in '25, whilst investment markets remained quite subdued. But we were pleased to make a number of target disposals at prices above book of smaller non-core assets, including an older estate and a budget hotel in London as well as some small residual land plots. As Susanne mentioned earlier, our rigorous portfolio review process subjects every single asset and land position to a thorough assessment of future returns and risks, and this directly feeds into our disposal planning. Everything we hold has to justify its place in the portfolio compared to our cost of capital and the expected returns from other opportunities. So 2026 is likely to see an increased level of disposal activity subject to market conditions, but we think those are also starting to improve. Development offers our most compelling immediate and medium-term return on capital. We invested GBP 413 million into it in 2025. GBP 387 million of it was on development CapEx, including infrastructure and GBP 26 million was on land acquisitions. That was all a little bit lower than our original expectations due to the slower pre-let market in the first half. That, in turn, fed into lower completions in the year with space equivalent to GBP 29 million of headline rent being delivered. The average development yield of 8.2% was above our normal range as it included a powered shell delivered in Slough -- powered shell data center delivered in Slough, I should say. And despite a lower proportion of pre-lets in the mix, the space we delivered was actually over 90% leased by year-end, suggesting that we picked the right submarkets in which to launch selective, speculative developments. All of the projects were rated BREEAM excellent or better. At the half year, we did point to an expectation of a recovery in occupier sentiment in the second half, which is indeed what happened with a strong run of pre-let signings, particularly in Continental Europe. So as a result, our on-site development program is now returning to more normal levels. Currently, it represents GBP 53 million of potential headline rent, of which 47% is already leased. And we have a further set of pre-let projects at advanced stages of negotiation, representing another GBP 9 million of rent plus an encouraging set of potential projects behind these, including in the U.K. So moving on, I'd now like to talk about the attractive growth potential in the coming years. Before covering data centers, what I want to talk about is the significant opportunity within our industrial and logistics business. As you know, we've positioned our portfolio and our business to benefit from a number of enduring structural trends. These have become somewhat muted over much of 2024 and '25, but now appear to be reasserting themselves. Digitalization, urbanization, supply chain optimization and a continued focus on sustainability once again are prompting occupiers to search for modern, well-located and energy-efficient space. At the same time, securing planning consents for new greenfield sites is increasingly difficult and urban brownfield land is continuing to be lost to competing uses such as residential and now data centers. For landlords and developers with the right assets, land, operational capabilities and balance sheet strength, this creates a supportive backdrop for future performance, which are exactly the things that SEGRO has. We've built a fantastic portfolio across Europe's most attractive markets. 2/3 of it is in dynamic high-growth and supply-constrained cities like London and Paris, where demand is diverse and long-term rental growth is expected to outperform. Plus, we have one of the best, most modern logistics portfolios and an exceptional land bank for development. And our market-leading operating platform with deep local capabilities across the U.K. and the continent, means we really know our markets, and we're well placed to spot new opportunities and drive further performance. There's a GBP 152 million of growth opportunity in the existing portfolio alone, including GBP 99 million of reversionary potential, 1/3 of which is available to capture with lease events due this year. There's a further GBP 53 million of opportunity in vacant space, much of which is recently developed or refurbished space that is well located and occupier ready to lease in 2026. Capturing these opportunities will continue to drive strong like-for-like growth and unlocking it requires very limited capital expenditure. On top of that, we believe that improving occupier demand and constrained supply will also support further rental growth, which we continue to believe will be in the range of 2% to 4% for Big Box logistics and 3% to 6% for Urban assets over the medium term. Beyond the existing portfolio, our land bank leaves us well positioned to deliver substantial development-led profit growth. The current pipeline plus near-term projects under advanced negotiation represents GBP 62 million of potential rent. The rest of the land bank offers a further GBP 346 million of opportunity at current market rents. Development yields remain attractive at between 7% and 8% with a greater than 10% yield on new CapEx. As James mentioned earlier, our teams have made great progress to have our super prime U.K. logistics sites construction ready, so we are brilliantly placed to capture improving demand. Combining all of these opportunities together, we set out our updated rental bridge chart. This is based on today's rents, so it doesn't capture any further ERV growth or indexation uplifts. And you can see that on top of today's GBP 755 million, we can generate another GBP 800 million of new rental income. Almost 1/3 of it comes from our existing portfolio as we lease our vacant space and capture reversion. 2/3 of it comes from our land bank as we complete schemes under construction and develop out the future pipeline. This only factors in powered shell developments in terms of data centers. But in fact, the data center opportunity is much greater than this. And this takes me on to the next part of the presentation. Demand for data centers in Europe is predicted to grow significantly in the coming years, led primarily by cloud adoption as businesses and individuals move more activity online and by inference AI, which is where the end users interface with the AI models. Most of this demand is being satisfied by hyperscalers who prefer building out their data center capacity in close proximity to major population centers and financial hubs within established availability zones in the so-called FLAP-D markets. This is because most of the applications running in these systems require low latency and high resilience to meet customer demands. Capacity constraints and demand growth are now pushing development into some newer availability zones such as in Berlin, Marseille and Warsaw. And by contrast, latency insensitive AI facilities for training in some of the inference workloads that don't require low latency, these can be located in secondary and tertiary locations where land and power are less constrained and energy is cheaper. These are the locations that are of no interest to us because we simply do not like the real estate fundamentals. Rather, our focus is firmly anchored on serving demand in supply-constrained and established and emerging European availability zones, markets that overlap with our existing portfolio of prime industrial assets and where our local platform and expertise provide a competitive advantage. Our ability to benefit from all of this future growth is underpinned by an exceptional bank of powered land across key European availability zones, which now totals more than 2.5 gigawatts. In addition to the 0.5 gigawatt of operational capacity mainly in Slough, we have a clear route to another 1.1 gigawatt, which can be pre-leased over the next 3 years and a further defined 900 megawatts of power supply in process supporting medium-term growth thereafter and with additional long-term multi-gigawatt opportunities being pursued over and above these amounts. Our sites are well positioned to secure the necessary planning approvals. And the simplified planning zone in Slough provides a unique advantage with data center development already preapproved and with an additional 0.4 gigawatts of capacity due in 2029, making it, we think, the largest holding of powered land with a live planning consent within any of the London availability zones. All of this puts us at the front of the queue in a number of markets and best placed to address data center customers' key criteria, which is essentially speed of deployment. We've delivered excellent progress in our 2025 strategy for data centers. We strengthened our specialist in-house data center and energy team. We formed a joint venture with Pure data centers, giving us access to the technical expertise needed to deliver fully fitted data centers. On the ground, we completed a powered shell for Iron Mountain on the Slough Trading Estate. We secured a building permit for our first French data center and submitted the planning application for the Park Royal joint venture project, which is expected to be determined in the first half of this year. From a power perspective, we initiated infrastructure works to support the power upgrades in Slough, and we secured a separate 190 MVA power offer in West London. We maintain the strategic flexibility across our portfolio, choosing the optimal route for each project based upon the site-specific characteristics, local market conditions and the expected returns. And while we expect to deploy capital through all 3 strategies, we are now increasingly focused on fully fitted projects. We believe that on certain sites, this model can generate development profits for SEGRO of up to 3x greater than for the equivalent powered shells, and we believe we can effectively manage the additional risks and complexity involved. And for the avoidance of doubt, this approach does not expose us to the obsolescence risks associated with innovations in chip technology because we will not be investing in the racks or in any of the compute capacity. Our fully fitted approach is designed to be capital efficient and operationally low risk. We will develop only within key availability zones on the basis of pre-let agreements to major hyperscalers before construction starts. We'll be targeting long-term net leases to avoid operational exposure, and they'll be delivered through JV structures that combine specialist expertise with strong governance. Project level financing and SEGRO's contribution in most cases of powered land will keep our cash equity requirements limited. In fact, broadly in line with, if not lower than the equivalent powered shell developments delivered on balance sheet. And although we have capacity to fund several fully fitted projects from existing resources, we expect to actively recycle capital from stabilized assets through a range of potential exit routes, recycling capital into other opportunities. Based on our assessment of the exceptional sites in our pipeline, we expect to bring forward 1 or 2 data centers per year for the next several years with a mixture of some powered shells, but mostly fully fitted data centers. We'll be carefully sequencing the delivery and monitoring the overall evolution of the European data center market to ensure that we manage our overall exposure to fully fitted data centers and to joint venture structures. So in summary on this piece, our data center platform represents a substantial incremental and value -- income and value creation opportunity. It's underpinned by unmatched European land and power positions, the capabilities to deliver both powered shells and fully fitted data centers as well as powered land sales, a disciplined approach to capital management and the strength of the SEGRO operating platform, including local market insights, planning expertise, energy capabilities and robust governance. This strategy gives us exposure to one of Europe's strongest structural growth markets and adds significant upside to the growth drivers already embedded within our industrial and logistics business. So let me conclude by bringing all of this together. 2025 was a strong year of operational and financial performance for SEGRO. Momentum that started building across our occupier markets in the second half of the year has continued to grow and become more widespread in 2026, and we are primed for significant growth in the coming years, thanks to our high-quality reversionary potential supporting strong like-for-like growth, upside from industrial and logistics development and a compelling opportunity with data centers, underpinned by a clear strategy, strong balance sheet and a market-leading operating platform. With that, I thank you for your attention, and we'll now turn to questions. Susanne, James and Marco, if you'd like to come and join me on the stage, so we can do that. And also Andrew Pilsworth, who's leading on data centers, he's going to join for this part as well. D. Sleath: Okay. Thank you. We're going to start taking questions in the room. [Operator Instructions] John, yes. Thank you. John Cahill: It's John Cahill from Stifel. Thanks for the presentation. Really good to hear a U.K. REIT, both positive looking backwards and forwards. With regard to the data center business, you're clearly backing the right horse here, and this will no doubt be a great success, I'm sure, in the future. But there's one of the big change that's happening in terms of European and U.K. industrial space, which is obviously the investment in defense manufacturing capabilities. Your contemporary at Sirius have obviously gone in that direction and the market has clearly liked that. Is that something you would perhaps seek to look to become more involved in, particularly in Germany. It sounded at the Munich Security Conference that there's going to be an awful lot of investment in that space. Would you be looking to go that way, notwithstanding the data center route? D. Sleath: Yes. I mean I'll give -- maybe just make an overall comment and then Marco specifically can add a Continental and a German flavor to it. I think what I'd say is, so far, it's -- I think it's a small thing in terms of impact on a business like ours. There may be some significant investment in some large defense capabilities around Europe. But generally, they're going to be in locations where governments want to encourage investment and the creation of jobs and not in prime locations where we want to keep our capital invested. Having said that, undoubtedly, there will be some spin-off. There will be some particularly logistics needs to actually move goods and services and support capabilities around. So it's something we are looking at. But I don't -- right now, I mean, it's a very helpful additional demand driver at the margin. I don't think it's going to have the same impact that, for example, e-commerce had over the last decade. But Marco, do you want to add anything in terms of what we're actually seeing? Marco Simonetti: Yes, I think you covered that well. So it's clearly a sector that we are monitoring. But at the moment, what we see that in terms of location are more bespoke locations. So those locations are not -- do not match with our strategy. But it's an additional demand and there will be some opportunities. So clearly, we are monitoring that across all the European countries where we are active. Maxwell Nimmo: Max Nimmo at Deutsche Numis. And -- just 2 questions, if I can. One on London. It feels like you feel a little bit more confident around kind of Western corridors, A40. Perhaps if you could just talk a little bit about the wider London market, North, South London, how are you seeing supply in that market? And then secondly, just on the data centers, I fully appreciate that you're not exposed to the kind of the chip risk. But just in terms of the build-out requirements, hearing lots in terms of the progression on liquid cooling, things like that. Where are the risks for what you're doing in the fully fit-out space? D. Sleath: Two good questions, Max. So obviously, the first one, James can make some comments on. And Andrew, maybe you can pick up on the depreciation and the obsolescence risk, which are slightly different things, but yes, do that. So James, do you want to do U.K. James Craddock: I think you're right. I mean, London is not one thing, and our urban markets are not one thing. And actually, the markets have quite different characteristics at the moment. So we were super pleased with the results we saw in terms of West London. It's a very mature market. There's a huge depth of number of customers. We've got a very good level of customer relationships in those markets. So that performed exceptionally well. And if you take Park Royal, you take Heathrow and you take Slough as our kind of urban markets, 70% of our U.K. portfolio is in those, and we're very confident about those and they're not particularly high vacancy markets. If you look at perhaps South and East, these are markets which are a little bit more fragile in terms of occupier -- in terms of vacancy. But again, we have seen a tick up in inquiries as we talked about as part of the presentation since probably, well, the back end of last year. So we are more confident in those markets, but it's definitely right to not see London and the urban markets as one thing. So as I say, we feel confident and look forward. D. Sleath: Andrew, data centers? Andrew Pilsworth: Yes. on data centers, yes, as you say, we are -- our end customers will be investing in the servers, the racking and as David mentioned, the GPU chips where we see that having the highest level of obsolescence risk. And actually, if you look at what we are investing in, we're investing in long-term power-enabled cooling technology. So it's all the mechanical and electrical equipment, which we think has long-term intrinsic values in those very attractive markets that we're investing in. So we think there's very -- they have a very long economic life and certainly longer than the leases that we're investing in. So on -- one of the risks is definitely obsolescence, but we feel that's covered off by that point. As David said, a slightly different issue on the depreciation. We are targeting a net lease structure to SEGRO, so very similar to what we do in the rest of our business. And the exact accounting treatment will depend on the structure of the lease, but certainly, the advice we've got that by targeting a net lease, that will be treated as investment property in a similar way to the rest of our portfolio. And indeed, if you look at other asset classes, offices where there's fit out and therefore, treated investment lease and no depreciation. D. Sleath: And I think on the point around the risk of obsolescence of technology moving on, I mean, clearly, it does -- it has evolved. The cooling technology has changed. I mean there was a big thing about water usage when water cooling was introduced a couple of years ago. Now the latest technology is basically it's a closed-loop system. So it's a bit like a car radiator, you put water in at the start and you don't need a huge amount of water then to run it thereafter. These things do change. But actually, if you go back and look at when we started 20 years ago with data centers in Slough, the first-generation data centers we built, they don't have the latest cooling technology and the latest engineering, but they're still fully used and fully occupational because, frankly, the growth of demand and the growth of need for data storage and processing capacity just outstrips the ability to build more. So it's very rare that people are going to just strip out the old stuff and say, we've got to write that off. This stuff seems to -- it's all additive. But each data center we build will have the latest technology, but the fundamental fabric of the building and the main cooling isn't going to change that dramatically. Yes, Zach. Zachary Gauge: It's Zachary Gauge from UBS. A few questions sort of all tied into each other. Firstly, just starting on the 7% yield on cost on the current pipeline. I appreciate that's ex data centers, which aren't under construction at the moment. But am I right in thinking that for sort of logistics space, 7% is kind of the run rate yield on cost now and to get up towards 8% plus, you need the higher-yielding data centers to sort of get that blended yield on cost higher? The second question is on the 300 megawatts of immediately available power. I think we sort of know about Park Royal and some power available in Slough. Is sort of the residual power in that the new opportunity in Paris? If so, that's a very large amount. And could you touch on what the plan is for that in terms of whether it's going to be fully fitted powered shell and whether you'll obviously bring in a JV partner if it is fully fitted? And then sort of lastly, on the wider data center strategy, I mean, it feels like a bit of a change in tone leaning towards more fully fitted. Obviously, the CapEx on that is going to be substantially more. I think for the Pure DC, we're looking at almost GBP 400 million for one project alone. You obviously guided to the 1% to 2% recycling, saying it might be slightly above that this year. Just how do we think about how this potential pipeline gets funded if it is successful and hyperscalers are there to take it? Because obviously, the CapEx numbers will go up very, very quickly. The income won't catch up as quickly. And would -- should we expect to see just an increased level of recycling well above the 2%? Or is equity raise potentially on the table if this is a success and you have the demand there to build them out? D. Sleath: Okay. I should have said at the beginning, one question, please. So we can keep up. But there's quite a few -- just briefly on -- and I'll throw the data center piece back to Andrew and maybe Susanne can comment on the capital side of it. In terms of development yields, we've always said that we should be shooting for between 150 to 200 basis points premium for a development yield over and above the equivalent investment yield of a prime product. Now if you think that equivalent yields now around -- somewhere around the 5%, 5% to 5.25%, something like that, maybe 5.5%, then in most markets, getting a development yield around 7% is actually a pretty good outcome and very profitable. Now we've said there's a range of 7% to 8% because we've got a mix of geographies. We've got a mix of, frankly, land holding costs or land values on the books. And we've got some markets where there's going to be some projects where we're going to do much better than that even in core industrial and logistics. So the reality is there's a range. But I think broadly, if we can be getting 7% to 7.5% on our industrial and logistics and closer to 8% when you blend in some powered shells, that's a very attractive overall development yield, but it will vary by geography and by product. Data center power, Andrew? Andrew Pilsworth: So that 0.3 gigawatts, we're not going to give details on individual sites and what we might pursue on them. However, what I can say that the 0.3 gigawatts that you referred to, Zach, that's spread across a number of opportunities, both in Slough. We do have some immediately available power in Slough, and we're in advanced negotiations with the customer on that power. But also within that 0.3 gigawatts, that's spread across a number of projects, not only in Slough and the U.K., but also across the markets in which we're present in Continental Europe as well. And as I said, I won't comment on the route we will pursue on individual sites, but we are likely to go for a fully fitted route with a JV partner to get the capability to utilize the capability on fully fitted -- their capability on fully fitted, and we're likely to pursue fully fitted in the strongest and most attractive markets. D. Sleath: Okay. Susanne, do you want to talk about CapEx? Susanne Schroeter-Crossan: Yes. Very happy to. So first of all, you are right that we are leaning towards more fully fitted data centers on suitable sites. So the best sites in our portfolio are suitable for that, and we are looking for joint venture partners to work on those fully fitted data center opportunities. What does that mean? So first of all, in terms of the equity contribution to the joint venture, we don't foresee this to be substantially higher than an investment that we would make into a powered shell because we are obviously contributing powered land to the joint venture. So that is as a starting point for us a favorable outcome. And then the CapEx financing for these projects is planned to be in the joint venture, meaning it's going to be project debt that is raised together with the joint venture partner at the joint venture level. This will initially have a relatively high loan-to-cost, but these longer data center projects will see a valuation uplift as we complete the phases of the construction, meaning that naturally, the leverage will come down as a result of it. Project debt is available at the moment. We have already a lot of discussions with interested providers. So we feel that this is a good strategy to fund the CapEx needs. And based on that approach, the currently envisaged strategy would not require an equity raise. D. Sleath: And maybe just to add to that, I mean, even if we've obviously -- we've got a view we've modeled out. We're not quite ready to share the detail of the forecast with the market. But we've modeled out what it will look like if we build -- I alluded to 1 or 2 per year. They won't all be fully fitted, but I think probably an increasing number will become fully fitted. We've modeled out what that looks like over the next several years. And frankly, even if you do it on a look-through basis, the impact on our LTV and indeed, the impact on our proportion of assets in data centers is very manageable. As long as we continue to actively recycle broadly across the whole portfolio, this is all very doable. So we think we've got plenty of capital to pursue this. And they're going to be 1 or 2 at a time or 1 or 2 a year. They're not going to be 5 in 1 year that would put an unnecessary strain on the balance sheet. Tom? Thomas Musson: Tom Musson at Berenberg. Just a question on Europe. I appreciate countries like Spain and Germany performed well. Can you just give a bit more color on the market dynamics in Poland and the Czech Republic, in particular, I think those are the 2 markets where asset values fell and rent growth was sort of flat there. D. Sleath: Yes, sure, Tom. Marco, do you want to comment on Czech and Poland? Marco Simonetti: Yes. So starting from rental growth, and we have 1% across Continental Europe. As Susanne said, a few countries that performed well, like Spain and Germany. Eastern Europe is a little behind in terms of rental growth. What we have seen, as I mentioned in my presentation, is that there was a recovery of the activity in the second part of the year, especially from September to December. And even in Poland, we had some spec development in Warsaw that has been fully let even before starting completion. We have done some major lettings like H&M in Central Poland. So there is a recovery of the market there. We don't see that yet in ERV growth because it was in -- those letting and pre-let have been finalized in the second part of the year. And so our values need a little more time in order to factor that in ERVs. But we are confident in our guidance that we give between the 2% and 4% on Big Box logistics, so we think that as soon as the occupational market is going to recover even more, we will see those level again. And in terms of rental growth, when we look to the performance of the European portfolio, I think that we have not to focus too much on just 1-year number because if you look to the 3-year rolling average in Continental Europe, ERV growth is above 3% and the average over the past 10 years is above 3% as well. So yes, it's just a matter of time. D. Sleath: But I think generally, in terms of Poland and Czech, in terms of places to invest, I mean, we -- Poland -- Czech has been an amazing success story for a long time. In Poland, I think GDP growth was 4% last year, expected to be top performing in Europe -- in the EU country this year or thereabouts, above 4%. So I think we've got very -- clearly, there's a lot of issues around geopolitics and what happens in Ukraine. But we've got -- we've got long-term conviction over Poland as a place to do business. So I think we'll continue to invest. Marco Simonetti: In terms of location, we are very selective in this market. And there are some markets like if you take the example of Czech Republic, we are just investing in Prague. We've done an acquisition last year, and Prague has been historically a strong market and benefit of the proximity to the German border. So we are just investing in selected location in Czech and in Poland as well. D. Sleath: Any more... Marios Pastou: Marios Pastou here from Bernstein. So I got a couple of questions from my side. So firstly, we obviously saw an improvement in the occupancy levels overall. I think there was a more mild improvement in the urban occupancy levels, both in the U.K. and on Continental Europe. Just in terms of the supply levels, the discussions you're having on that urban portfolio and your urban exposures. What are your expectations in terms of the trajectory ahead for a recovery in occupancy in those markets towards more normalized levels? And then secondly, you were talking about the use of third-party capital. And obviously, you've got some quite large schemes in the U.K. You mentioned the 9 million square foot of potential space. And just any thoughts around whether you could utilize third-party capital there and how that structure could potentially look? D. Sleath: Sure. I mean, James has already sort of covered a bit about the U.K. market. So I won't repeat all of that. But I mean, for us, most of our urban vacancy is in London. We actually -- the bulk of our exposure is to West London in Heathrow and Park Royal and indeed Slough. That's a pretty strong market. In fact, in Heathrow, there's a real shortage of good space right now. There's not much supply in any of these markets. Where there is a bit more vacancy for us and in the market is in the East and the South, in particular, to Croydon and Barking and Dagenham area. We don't have a huge amount of space in those markets, but there has been more supply, particularly going out east because land is a bit more available. So that's one to watch. And I think we need to see a bit of a recovery in the London economy before that's going to pick up. But we're optimistic about North London. It's a pretty tight market around Enfield. We've got a bit of vacancy there, but -- and they're good units, but optimistic that will improve this year and further performance to come in West London as well. I think Croydon and East London, we've got a bit of interest. We'll see if it all actually crystallizes, but those are the stickier markets right now in terms of our whole portfolio. Urban elsewhere in SEGRO. We're building speculatively in Germany. It's leasing up really well ahead of expectations, quite often leased before we get to completion. So that's that. In terms of funding, third-party capital, as we said in the presentation, we keep that option open. We've had some success clearly over a long period of time with our SELP vehicle in Continental Europe. We do have a new JV model for working on data centers, which is partly around access to skills and capabilities and partly around share and capital intensity. And as we look at the significant opportunities we've got ahead of us in all parts of our business, including in the U.K. logistics piece, we're thinking about, is it best to do it ourselves on balance sheet? Is it best to do it in partnership. And we're having, as you'd expect, conversations on those, but nothing is sufficiently far advanced that we can say any more about that other than nothing is off the table, and we're always looking at these things. Suraj Goyal: Suraj Goyal from Green Street. Just one quick question. So there's mention of positive demand from e-commerce players returning to the market, including sort of Asian players. Big picture, what are your sort of thoughts on where the U.K. e-commerce penetration rate could land in the next 5 years, particularly with the potential boost from Agentic commerce? And then what do you think that sort of means for your expected market rent growth over the next sort of 5 years? D. Sleath: The U.K. question, particularly, was it? James, why don't you comment on what we're seeing on e-commerce and where you think it's going? James Craddock: Yes, you're right. So in e-commerce, we are seeing the return of a couple of big players who've been out of the market for a period of time, which obviously is good in driving the market. We've also seen some of the Chinese players also come into the U.K. market, in our own portfolio. We've seen that more in the last mile piece around London and our urban markets. In terms of a look forward, as I say, there's a couple of things that make us feel quite confident. I think that the absorption of gray space, which I mentioned in the presentation, is an important factor because -- and that should drive more pre-let activity as we look forward in those markets. And then on the supply side, the ability to find sites in specific locations, which can deliver large boxes is very challenging actually. And there's a theme around consolidation in the U.K. market. So customers who are looking to drive efficiencies, consolidating into more efficient facilities, which are generally larger, we've seen an uptick in the demand for larger buildings. So again, that favors companies like SEGRO who do own those sites in those right locations. And on a look-forward basis, again, if you look back on a long-run average for the U.K. Big Box, we delivered over 4% ERV growth over the past 10 years. So again, no reason to adjust that look-through guidance of 2% to 4% on a look-forward basis. D. Sleath: I think the other thing about e-commerce, I mean, clearly, there was a time back in the pandemic when there was a bit of a narrative around we're only ever going to shop online from here. Clearly, there was a massive expansion. That's now slowed down. There's been a lot of consolidation over the last 2 or 3 years. But our expectation -- our firm view is clearly, physical retail will continue to play a very important part in how consumers want to buy stuff. But there's no doubt that the amount of shopping that's done online will continue to increase as a proportion. Where it gets to, I don't know, but it's definitely on the up. And as James says, people need to invest in better facilities, better distribution networks to do that, and that goes to both the big logistics units for fulfillment, but also last mile. The real battleground continues to be in the major cities like London and Paris around delivery of last mile, getting the product to the consumer faster and more sustainably. And to do that, you need to have the right last mile facilities as well. So we feel really positive that after the boom and the quiet period post pandemic, e-commerce is going to continue to be a factor. It's not going to be the whole thing, but it's going to be a factor. I think we probably -- unless any more in the room, we ought to go to the conference line. So if the operator is listening, could you please take some calls -- take some questions from those online, please. Operator: [Operator Instructions] We have our first question from Frederic Renard from Kepler. Frederic Renard: I have 2, if I may. The first one is on the CapEx range, which has been around EUR 500 million over the last few years at the start of the year for quite some year now. But you mentioned delivering between 1 and 2 DC assets from here. I was wondering what would be then the CapEx on a run rate basis and on a true basis, if you consider that? That would be my first question. And then I would like to come back on the third-party capital. And you look quite enthusiastic there. Of course, there was an article also in the press in January mentioning potentially opening the U.K. Big Box business to a partner. How do you evaluate the trade-off between short-term earnings, potential decline and long-term value creation? D. Sleath: Well, that's a very good question on the latter one, and that's exactly what we're thinking about as we decide how to fund our development opportunities going forward. So I'm not really going to try and answer that now other than to say that's exactly what we're thinking about is what's the impact on near-term and longer-term performance for us. And also how does -- if we were to create another vehicle, how does that fit with the overall capital stack and the way we're funding the whole business. So unfortunately, we just have to wait and see on that one. In terms of the capital expenditure, the run rate about GBP 500 million per annum historically, if you sort of average it out, we've guided to GBP 450 million to GBP 550 million this year, which, as Susanne said, will depend on the rate of pre-lets. There -- that does not yet include any fully fitted data centers. The first fully fitted data center, if we -- assuming we get planning, will probably be in Park Royal this year or next year. I mean they're very big projects. We'll get planning, I'm sure, this year, whether we sign a pre-let. If we do this year, it will be back end of the year. So I don't think it will have a dramatic impact on this year's CapEx. But going forward, if one of the 1 to 2 data centers turns out to be fully fitted, then as Susanne said, the actual -- in fact, I did it in my bit of the presentation, the actual cash impact for us is going to be similar. If we do it in a JV off balance sheet, the cash is going to be similar. So somewhere around GBP 75 million or GBP 100 million of cash equity contribution is typically what we'd expect. But if you do it on a look-through basis, I mean, the CapEx on these things is about GBP 800 million, something of that order. So you're going to be taking half of GBP 400 million, but that would be spread over a couple of years or so. Operator: We have our next question from Paul May from Barclays. Paul May: Just I got 3 quick ones, hopefully. First one for Susanne, just a quick question on the old bug there around capitalized interest. Just wondered coming in from the outside, what were your views on the policy and the assumptions behind it? And can you just confirm what the main sort of assumptions are, the financing cost that's used? What is actually interest capitalized on? Is this just current developments? Is there any future developments, land infrastructure, et cetera, within there? Should I ask them one by one or... D. Sleath: Yes. Well, why don't you give all 3 and then we -- and then we can deal with them. The 3 quick ones, Paul. Paul May: Yes. The second one, given the subdued investment market, as you mentioned, and I think if you look around, there's been relatively limited capital raising for warehouse or logistics funds. Just wonder what gives you the confidence that you're going to sell more? And what yields would you be willing to sell at? And then on the London market, what we've heard is that rental levels or ERVs have become not necessarily unaffordable, but not affordable for many tenants, I think, is the comment that we've had. Does this go some way to explain the higher vacancy in that market and the comment in the report that tenants remain more discerning in London and Paris. D. Sleath: Okay. Right. So I think Susanne is going to talk about capitalized interest. Maybe I'll pick up on the investment market and what we're seeing in terms of yields and pricing and volumes. And then James, back to you on London ERV. So Susanne. Susanne Schroeter-Crossan: Okay. So on capitalized interest, Paul, we do capitalize interest, of course, on developments, but also on land where we are doing significant infrastructure or preparatory work to get the sites to a construction-ready state. And we have larger sites, as you are probably aware, across the U.K. that do require infrastructure investment, and this is also part of the capitalized interest that we apply. In terms of the cost or the interest that we are using to calculate, we are using where available, the specific funding rate that is related to where the source of capital comes from for those works that we are doing and where there is no such specific rate available, we would use the marginal cost of funding. In my view, this approach is the most realistic approach that we can find to match with what is actually ongoing. And if you also look at, for example, the 2025 numbers, we have GBP 63 million in total of capitalized interest and the vast majority was capitalized at the specific rate. Only about GBP 2.5 million of that were done on the marginal rate. So it's a very minor portion where we don't have the specific rates. The approach we take is, of course, fully aligned with accounting standards and also discussed with our auditors. So I feel comfortable with that approach. D. Sleath: Okay. Investment markets, I think you're asking what gives us confidence [indiscernible] that we're going to be able to trade more in these markets. Well, we are talking to the market, talking to our advisers and sources of capital. And I would say there's more capital coming into real estate generally and within real estate, industrial logistics and residential, the 2 favored sectors other than data centers. Time will tell, but there's definitely more signs that investors are willing to start putting money to work in the early weeks of this year, Paul. But we -- time will tell, but I think people have been sitting on the sidelines long enough. And I think given the relatively attractive outlook and the improving occupier fundamentals that we were chatting about, I think there's a very good chance that a lot of that capital will be put to work this year. We'll see. London ERVs, James. James Craddock: Yes. Look, I mean, of course, there are customers who continue to feel cost pressures. And there are customers that don't choose to be in London and can't afford to be in London. But for every customer that can't afford to be in London, there are multiple customers that do need to be in London and can afford London because of the nature of services they're providing, which typically the higher-value goods and services. And look, I don't think you can ignore what the portfolio is telling us. We have seen a nudge down in vacancy from an urban standpoint from 9.6% to 9.4% during the course of 2025. And also our ability to continue to capture reversion, drive ERV growth, see low insolvencies in that market, again, points to a relatively favorable position. The other thing I'd say is there is a narrower discount now between prime home counties in London. So again, on a look-forward basis, I think that drives really positive retention rates for our London markets. And if you look at our highest rental market, which is Park Royal and West London, our in-place ERV is actually only GBP 23 per square foot and you compare that to the top rents that are achieved in the market of GBP 32 to GBP 35 per square foot. So we see plenty of room for growth in those markets and a resilient occupier base. D. Sleath: I think maybe one more question on the phone line. Operator: We have our next question from Marc Mozzi from Bank of America. Marc Louis Mozzi: I have some follow-up questions on your data centers, if I may. And the first one would be, could you please quantify the quantum of CapEx we should expect over the next 3 to 5 years related to data centers? And the second related question to that is, when do you think we should start to forecast any rental income or any income coming into your P&L on which yield basis, knowing that it's going to be a blend between powered shell and fully fitted data centers? D. Sleath: Yes. You're not going to like this, Marc, but we're not really going to answer those questions just yet. I mean we've talked already about the scale of some of these projects and the likely CapEx, whether done on balance sheet for powered shell or off balance sheet fully fitted. I think when we've signed some deals, we will share some updates to our CapEx expectations, and that will also enable us to talk about timing of rental flow. So unfortunately, we're going to have to hold fire on that one for now. Sorry. Marc Louis Mozzi: Fair enough. And I have another question, which is related to your infra CapEx, which is going to be GBP 300 million, if I'm correct, from last year and this year. Is that a non-yielding asset or non-yielding CapEx on the year of deployment of the project? And is that part of the yield on cost of 7% you're mentioning? Or is it something which is going to drive the yield lower 1, 2 and then it's going to ramp up? D. Sleath: So is the GBP 300 million of infra spent last year and this year, is that accretive? Is it -- and how is it accounted for in our development yield guidance? The answer is, it is obviously enabling works that will allow those projects to go ahead, including the power upgrades in Slough. And so when we give our guidance on development yields, that's with each project taking its proportionate share of that infrastructure spend. So it's not an additional non-yielding part of capital. It's factored into our development yield guidance. Thanks a lot, Marc. We've got just a couple of questions maybe coming through the webcast, and Claire is going to read them out. Claire Mogford: Yes, we have. A couple on data centers to start with. How much of the 1.1 gigawatts of land or power available to lease by 2028 is secured and within your control? D. Sleath: All of it. Claire Mogford: And then we had a question on the simplified planning zone in Slough. That needs regular renewing. When is the next renewal date? D. Sleath: Of these SPZ. We've got -- it was just renewed at the end of 2024. So the SPZ, it runs for 10 years. This is the fourth iteration. We've had 3-year renewals. So it's got 9 years to go before we have to renew again. It's a big process to get that renewed, and we never take it for granted, but we have a very good working relationship with Slough Borough Council, and I think they see the benefits that the SPZ has brought. So 9 years for, every expectation that it will continue thereafter as well. Claire Mogford: And then another one on power. Grid connections are difficult and subject to queue management issues. Have you ever lost a place in a queue? D. Sleath: No. We -- no, we haven't. And particularly in West London, what we're able to do is lock things in early. We've been planning for the upgrade Uxbridge Moor Power Station for quite a while. So in fact, our position in that is kind of clear of any NESO review of the queue process. And we're bringing it through elsewhere as well. So no, we haven't lost a position. Claire Mogford: And then the last one on data centers. Can you remind us of the income recognition differences between powered shell and fully fitted? And when will we -- but more importantly, when do we start to expect to see the income? D. Sleath: Well, the -- yes, I mean, in theory, the data center, whether we lease the powered shell or we build fully fitted, it is going to become active and operational at the same time. If we do a powered shell, it's quite possible that with a rent-free period in there that the income for us in P&L terms at least can start earlier because we would typically build the shell, might take 12 or 15 months to build it, then we would hand over the keys, rent-free starts and we start accounting for the income at that point. Whereas if we do a fully fitted data center, the income is going to take another probably 18 months to 2 years because of the extra fit-out time, so really 3 years in total. So there is an 18-month or 2-year lag between income recognition on powered shell versus fully fitted in broad terms. But we think it's worth the wait. Claire Mogford: A question on capital allocation. Your comment on assets having to justify their place in their portfolio and increase target disposals. Does that mean you think assets generate less -- do you think less assets generate sufficient returns relative to your cost of capital right now? D. Sleath: What we're saying is we rank all our assets according to return expectations and risk profile. And given that we have a lot of high returning opportunities ahead of us, we want to accelerate and increase the volume of disposals we do so we can self-fund a lot more of that capital investment. And therefore, the -- if you like, the line below which assets that fall under -- become disposal candidates has raised throwing up more opportunities or more situations where we think, you know what we should -- it's done very well for us. It's performed well over the years. Now it's time to take our money out and put it into new opportunities. Thank you very much. I think we're done. I'm sorry, it's been a long session. Hopefully, interesting, and thanks all very much for your questions and your attention. Have a great day.