This year promises to be a unique period for Green Property with record rental and net asset value (NAV) growth. This raises just one question: can it be maintained? While it is unlikely to sustain the record 35 per cent annual growth in NAV it enjoyed over the past five years, it is nevertheless poised to generate substantial growth.

With 63 per cent of its rents portfolio coming up for review this year, £150 million sterling property sales in the UK, and an undefined amount of asset sales in the domestic market, this should be an exceptional year. However, reviews on the present portfolio taper away after that. Some 19 per cent comes up for review in 2002, 8 per cent in 2003, 7 per cent in 2004 and just 3 per cent in 2005.

Of course, its property portfolio is likely to be very different in 2005. And what is not apparent from the company's accounts is the potential benefits to come from its joint venture arrangements. The recent £246.5 million purchase of the 425,000 sq ft River Court, at 120 Fleet Street, London, which will house the headquarters of Goldman Sachs, could give a substantial return. A consortium of Irish investors and Green paid just £40 million and the remainder is being funded by a German mortgage, making it a highly geared off-balancesheet transaction. So if subsequently sold at a profit, the return on the equity investment should be substantial.

The latest results show how important joint ventures are to the group. In 2000, its share of profits from these ventures amounted to €18.6 million, which boosted its core profits by 23 per cent. Indeed without these joint ventures and property sales of €2.9 million, Green's pre-interest profit would have risen by just 17 per cent, instead of the reported 32 per cent.

The P&O joint venture in the UK, which is a mixed bag of retail, offices and industrial, has been very lucrative. Bought for £425 million, Green's equity investment was £15 million. But the return on investment in just seven months was £15 million with the remaining assets valued at £159 million. So in order to maintain momentum, it will need a continued flow from joint ventures and property sales; otherwise growth could be very lumpy.

While the ratio of borrowings to shareholder funds fell from 68 per cent to 65 per cent last year, this ratio does not reflect the joint-venture borrowings which are off balance sheet. But in the event of a collapse in the property market, only the group's equity investments would be exposed.

Green has an active development programme with a capital cost of more than €225 million, while proposed developments will have a capital cost well in excess of that. The current programme includes four developments in this State and five in the UK. Irish developments comprise Penneys in Blanchardstown (60,000 sq ft retail), Site K Blanchardstown (110,000 sq ft offices), Sandyford phases one and two (340,000 sq ft offices) and Fonthill Hays/Amari/Whirlpool (80,300 sq ft industrial). The UK developments are in Slough, Guilford, Brentford, Electric Park and Crayford.

Proposed developments include four in this State and five in the UK. The Irish developments consist of Blanchardstown Retail Park (150,000 sq ft retail), Site A Blanchardstown (70,000 sq ft offices), Fonthill (30,000 sq ft industrial) and Ballymun ( 250,000 sq ft offices). The proposed UK developments are in Electric Park, Circles North, Purley Way, Ringway and Barton Power Station.

Green's top 20 tenants pay rent ranging from over £473,000 (€600,000) by Katsouris Fresh Foods to more than £4.73 million (€6m) by Microsoft. The five largest after Microsoft, are Avaya UK, Irish Express Cargo, Eircom, Sainsbury's and the Office of Public Works.

A breakdown of Green's €1.9 billion portfolio shows the UK accounting for 48 per cent (investment 42 per cent, development 6 per cent) and the domestic market accounting for 52 per cent (investment 49 per cent, development 3 per cent).

Around 56 per cent of the €90 million rent roll is generated in the UK and 44 per cent in the domestic market. Green thinks the UK market will grow faster because it is more liquid with more opportunities, though it concedes a similar view expressed a few years ago did not materialise because of the exceptionally strong domestic market.

However, if joint ventures are taken into account, the UK portfolio is much larger, and with the continued emphasis on selling development properties in that market, that position should be consolidated.

With the rent reviews and developments in the pipeline, Green should have little difficulty in raising its NAV per share from €10.56 to over €12 this year, with further growth in 2002.