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London calling? Foxtons says lower rents attracting more tenants

File photo of a Foxtons estate agent sign outside a branch in north London

(Reuters) - UK-based real estate agency Foxtons Group Plc said on Wednesday more tenants are filling buildings in London, attracted by a 12% drop in rental prices during the COVID-19 pandemic.

Foxtons, which assists people in both renting out properties and selling them, bolstered its presence in London over the past year with the purchase of Douglas & Gordon.

"We have seen good growth in lettings applicants and listings, and revenues have now returned to pre-lockdown levels," Foxtons said.

The outlook bodes well going into Spring, a key deal-making season. The real estate market as a whole was hammered last year as lockdowns and subsequent uncertainties about the future prevented people from making big life decisions, while companies held back on discretionary spending.

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Foxtons was forced to tap markets for additional cash and furlough employees last year, but a tighter control on costs helped it post a smaller statutory loss before taxes of 1.4 million pounds for the 12 months ended Dec. 31 from 8.8 million a year earlier.

The company said it has seen strong profit growth in the first two months of 2021 as its sales commission pipeline jumped 30% compared to a year earlier, with the value of it reaching levels not seen in four years.

(Reporting by Muvija M in Bengaluru; Editing by Rashmi Aich, Bernard Orr)