A strategy of consolidation and investment in a high-interest-rate environment continues to come at a price for London commercial property owner/manager Howard de Walden Estates.

Its property empire, which includes prime shopping areas in Marylebone and within the fashion-centric Marylebone Village saw its pre-tax loss more than double to £254.2 million during its latest financial year ended 31 March.

That figure includes a £331.8 million loss from revaluing investment properties while values alone fell 8.2% on a like-for-like basis during the period. Net debt also increased to £604 million from £552.3 million in the year.

But there were positives with rental income increasing 3% to £152.2 million while it also signed £35.4 million worth of new lettings and 746 new leases, up 4.2%.

Marylebone has proved to be a popular premium neighbourhood and has benefitted from strong interest from the fashion sector.

Retail, Leisure and Hospitality income saw growth of 7%, “driven by new lettings, underpinned by strong demand from a diverse range of businesses. Occupancy levels here also remained high throughout the year with just a 3% vacancy rate at year end.

Howard de Walden chairman Sir William Proby said: “We have come through a testing time over the last four years. However, there are signs that we may have reached, or are very close to, the bottom of the current property cycle. Our strong financial position means we can expect good opportunities for the Estate to prosper.”

Chief executive Mark Kildea added: “This year we have invested into areas where we expect significant opportunities to grow net rental income and position for the future. We have made excellent progress against our strategic objectives, including the successful delivery of several high-quality developments across all sectors. We are confident that we are well positioned… with significant financial capacity, high occupancy levels and a dedicated and motivated workforce in a unique and desirable part of London.”