REIT News - July 2022

Insights /

Welcome to Ince Corporate Finance’s REIT News update...

REIT Market Overview

The month of June witnessed strong activity across all REIT sectors with regard to acquisitions and quarterly financial and operating updates.

AEW UK REIT acquired the 6.04-acre Railway Station Retail Park in Dewsbury for a price of £4.7 million. Big Yellow acquired an existing 53,000-sqft self-storage centre in Aberdeen for £10 million. Custodian REIT announced the disposal of a 24,178-sqft car showroom in Derby for £5.6 million and a purchase of a 70,160-sqft retail park in Nottingham for £15.0 million. Impact Healthcare REIT announced the acquisition of three properties for £25.0 million. Regional REIT Limited acquired separate assets in Sheffield city centre, Thorpe Business Park, and Leeds city centre for £8.5m, £8.6m, and £9.4m respectively.


Market Activity
(Ticker, Share Price, EPRA NAV per Share, Premium/Discount)


AEW UK REIT Plc (LON:AEWU, 114.2p, 120.6p, -5.3%)

AEW UK REIT plc announced the acquisition of the 6.04-acre Railway Station Retail Park in Dewsbury for a price of £4.7m The purchase price reflects a low capital value of only £82 per sqft and provides an attractive net initial yield of 9.4%. The park is fully let with a low average passing rent of £8.28 per sq ft, which the Investment Manager believes provides strong potential for rental growth. Tenants include Sports Direct, Mecca Bingo, Fieldrose Ltd, trading as KFC, and the Danish furniture retailer, Jysk. The park occupies a prominent location on the edge of the town centre within an established retail and leisure area. Neighbouring occupiers include Sainsburys, Aldi, Matalan, Pets at Home and Iceland as well as a council operated library and sports facility. Dewsbury has a tight supply of retail warehousing stock, with no current vacancies within the town.


Big Yellow Group Plc (LON:BYG, 1,319.0p, 1,034.6p, +27.5%)

Big Yellow announced the acquisition of an existing 53,000-sqft self-storage centre in Aberdeen for £10 million. The store, currently branded as Simply Self Storage, is the only purpose-built self-storage centre in Aberdeen, and will be rebranded as Big Yellow. The purchase price represents a starting 6% net initial year one yield, which should grow to 9% within two years as the store benefits from being added to the company’s digital platform. There is also surplus land, which provides the opportunity for expansion.

Big Yellow announced that it has exchanged contracts to acquire a prime site on Farnham Road in Slough from SEGRO plc. The site falls within the Slough Trading Estate Simplified Planning Zone ("SPZ") Scheme. The SPZ sets out a series of conditions and, provided that a development fully complies with these conditions, there is no need to secure a full planning permission to develop the proposed 62,000-sqft store on the site. As part of this transaction, the Group has also agreed to the surrender of the lease on its existing Slough store on Whitby Road, which is leased from SEGRO plc. The lease surrender will take effect six months after the completion of the construction of the new store, which is anticipated to open in Summer 2024. The total development cost of the new store is approximately £19 million.


Civitas Social Housing Plc (LON:CSH, 79.1p, 110.3p, -28.3%)

Civitas Social Housing, the UK's leading care-based and healthcare REIT, presented its full year results for the year ended 31 March 2022. Key details are:

  • Portfolio value increased to £968.8m from £915.6 million (IFRS);
  • IFRS valuation average net initial yield (NIY) of 5.28%;
  • IFRS NAV increased to 110.3 pence per share reflecting ongoing demand for investment in the asset class as well as
  • the effect of indexation of inflation adjusted leases;
  • Rent Roll Up Benefiting from Indexation;
  • Annualised rent roll increased by 6.5% to £54.1 million;
  • EPRA earnings per share (basic and diluted) 4.82 pence per share (2021: 4.93 pence per share);
  • Diversified Portfolio of 696 Properties Providing Homes to 4,592 Residents;
  • Providing lifelong homes to working age adults with disabilities and complex care needs with an average tenant age
  • of c. 32 years;
  • High acuity care being provided, with 40% of residents living in Civitas properties receiving over 50 hours of care
  • per week;
  • Properties located across 178 Local Authority partners in England and Wales and leased to 18 approved providers,
  • with support provided by 130 Care Providers;
  • Over one third of the portfolio on back-to-back 25-year leases, with leading Care Providers.


Custodian REIT Plc (LON:CREI, 99.8p, 119.7p, -16.6%)

Custodian REIT, the UK property investment company, announced the disposal of a property from its portfolio. The Company has sold a 24,178-sqft car showroom in Derby let to Volkswagen for £5.6 million, £1.2m (26%) ahead of the 31 March 2022 valuation, representing a net initial yield of 5.7%. Following the disposal, net gearing has decreased to 20.5%.

Custodian REIT announced full year results. Key details are:

  • EPRA earnings per share 5.9p (5.6p in 2021);
  • Profit before tax £122.3m (£3.7m in 2021);
  • Dividends per share 5.25p (5.0p in 2021);
  • NAV total return per share 28.4% (0.9% in 2021);
  • NAV and EPRA NTA £527.6m (£409.9m in 2021);
  • NAV per share and NTA per share 119.7p (97.6p in 2021);
  • Net gearing 19.1% (24.9% in 2021).

The Company’s investment policy:

  • To invest in a diverse portfolio of UK commercial real estate, principally characterised by individual property values of less than £10m at acquisition;
  • The property portfolio should be diversified by sector, location, tenant and lease term, with a maximum weighting to any one property sector or geographic region of 50%;
  • To acquire modern buildings or those considered fit for purpose by occupiers, focussing on areas with:
    • High residual values;
    • Strong local economies; and
    • An imbalance between supply and demand.
  • The Company will not undertake speculative development except for the refurbishment of existing holdings, but may invest in forward funding agreements where the Company may acquire pre-let development land and construct investment property with the intention of owning the completed development;
  • The Company may use gearing provided that the maximum LTV shall not exceed 35%, with a medium-term net gearing target of 25% LTV.

The Board is committed to seeking further growth to increase the liquidity of its shares and reduce ongoing charges. Its growth strategy involves:

  • Organic growth through share issuance at a premium to NAV;
  • Broadening the Company’s shareholder base, particularly through further penetration into online platforms;
  • Taking market share from failing open-ended funds;
  • Strategic property portfolio acquisitions and corporate consolidation.

Environmental, social and governance (“ESG”) objectives include:

  • Improving the energy performance of buildings;
  • Reducing energy usage and emissions;
  • Achieving social outcomes and supporting local communities;
  • Understanding environmental risks and opportunities;
  • Complying with all requirements and reporting in line with best practice where appropriate.

In November 2021, the Company acquired DRUM Income Plus REIT plc (“DRUM REIT”) at a 28% discount to its net asset value, resulting in a £7.3m valuation gain post-acquisition. Since acquisition, DRUM REIT has traded well, enhancing the Company’s EPRA earnings per share and maintaining its ‘red-book’ valuation at £49m. Since the year-end new lettings have been secured at certain sites which should further enhance total returns in the coming periods.

Custodian REIT also announced a further property purchase of a 70,160-sqft retail park in Nottingham consisting of four units occupied by Wickes, Matalan, Poundland and KFC, with nearby retailers including Tesco, Morrisons, Lidl and McDonald’s. The units have a weighted average unexpired term to first break or expiry of 9.0 years with an aggregate passing rent of £994,050 per annum, reflecting a net initial yield of 6.21%. The agreed purchase price of £15.0 million was funded from the Company’s existing debt resources, moving net gearing to 22.7% loan to value.


Ground Rents Income Fund Plc (LON:GRIO, 58.9p, 93.6p, -37.0%)

Ground Rents Income Fund published its Half Year Report for the period ended 31 March 2022. Key details are:

  • Company’s NAV was £89.5 million or 93.6 pence per share as at 31 March 2022. This reflected a NAV decline of 9.5 pps or -10% and a NAV total return of -7.8%;
  • Independent portfolio valuation carried out by Savills as at 31 March 2022 of £110.0m represented a decrease of £9.4m or -7.9% over the period (30 September 2021: £119.4 million);
  • As at 31 March 2022, the portfolio comprised approximately 19,000 units across 392 assets valued at £110m. The portfolio produces ground rent income of £5 million per annum, reflecting a gross income yield of 4.5% or an average Years Purchase (“YP”) of 22;
  • The portfolio’s weighted-average lease term as at 31 March 2022 was 379 years, with 94% of ground rent income subject to upwards only reviews;
  • The Company has a £25m facility with Santander UK Plc comprising a £12.5m term loan and a £12.5m Revolving Credit Facility, which matures in January 2025. The total ‘all in’ interest rate is approximately 2.46% per annum.


Impact Healthcare REIT Plc (LON:IHR, 116.5p, 114.9p, +1.4%)

Impact Healthcare REIT, the real estate investment trust that gives investors exposure to a diversified portfolio of UK healthcare real estate assets, announced the accretive acquisition of three properties with an existing Group tenant, Welford Healthcare, for £25.0 m, plus transaction costs. The portfolio includes a 61-bedroom specialist dementia nursing home in Devon, which was purpose-built in 2011 and benefits from 100% en-suite wet rooms, and two part-converted and extended nursing and residential homes in Devon and Somerset registered for 54 and 69 elderly clients, respectively. All three properties are well located with long-standing exceptional local reputations for providing high-quality care within the local community. The homes have CQC ratings ranging between Good and Outstanding and benefit from favourable underlying demographics in the local catchment areas with attractive
demand/supply fundamentals.

Impact Healthcare REIT announced its intention to issue new equity in order to acquire an identified pipeline of care homes. The Company will raise new equity through a placing (the "Placing") of New Ordinary Shares under the Company's existing Placing Programme. In addition, the Company is proposing to raise up to the Sterling equivalent of €8m pursuant to an offer for subscription.


  • An issue of New Ordinary Shares at 117.0 pence per New Ordinary Share (the "Issue Price");
  • The Issue Price represents a premium of 1.8 per cent to the Company's unaudited Net Asset Value ("NAV") per Ordinary Share of 114.93 pence as at 31 March 2022;
  • The Company is in advanced negotiations to acquire six portfolios, consisting of 27 separate care homes, for a total value of approximately £169m (the "Pipeline"). Whilst some of these homes can be acquired from the Company's existing resources, including available debt headroom of £70 m, as well as new debt to be put in place alongside the acquisitions, the Company will require new equity in order to complete on all the potential opportunities;
  • The Company continues to perform strongly and as an owner of UK care homes is supported by several structural benefits including:
    • Long term, inflation linked, lease structures with the Company benefiting from a WAULT of over 19 years and 98% of its rent roll being linked to RPI (the remaining 2% linked to CPI), subject to caps and collars;
    • A diverse portfolio of 128 different homes (which has grown to 134 properties since the quarter ended 31 March 2022) with an EPRA 'topped up' Net Initial Yield at 31 March 2022 of 6.71 per cent as well as sustainable and affordable rents;
    • A portfolio of well-run and financially stable care homes with established care quality and financial track records and tenants who are willing to invest, sometimes alongside the Company, in ensuring high ongoing operational standards in their homes;
    • A disciplined approach to leverage with loan-to-value ("LTV") of 19.4% (as at 31 March 2022), with a weighted average cost of debt of 3.1% and weighted average term to maturity of 6.1 years. The Company's maximum permitted LTV is 35%.
  • The target total dividend for the year to 31 December 2022 amounts to 6.54 pence per share and is paid quarterly, which equates to a dividend yield on the Issue Price of 5.6 per cent;
  • Holders of the New Ordinary Shares being issued pursuant to the issue will be eligible to receive the interim quarterly dividend in respect of the quarter ended 30 June 2022, which is expected to be declared in August 2022;
  • Between its IPO on 7 March 2017 and 21 June 2022, the Company has delivered total shareholder returns of 63.3 per cent., equating to an annualised return of 9.7 per cent.
Industrials REIT Plc (LON:MLI, 155.0p, 177.0p, -12.4%)

Industrials REIT, the specialist UK multi-let industrial business, announced results for the full year to 31 March 2022. Operational highlights:

  • Like-for-like passing rent increased 4.4% (2021: 5.6%);
  • 265 new leases agreed, with Smart Lease transactions accounting for 53% of all new lettings and renewals, shortening void periods and reducing costs;
  • Portfolio ERV increased 4.3% on a like-for-like basis (2021: 5.1%), creating a 12.6% premium to current passing rent on occupied units which is highly supportive of future rental growth;
  • Occupancy across MLI portfolio steady at 93.6% (2021: 93.7%);
  • £97.6m aggregate purchase price of 18 MLI assets (2021: £91.5 million across 14 assets) which grew the portfolio to 104 properties and helped increase MLI net rental income by 42% to £32.8m over the year (2021: £23.1 m);
  • Sales of the final three wholly owned non-MLI assets completed in the year generating aggregate net sales proceeds of £46 m;
  • Rent collection levels are now nearing pre-Covid levels with 93% of invoices billed in FY22 paid, resulting in a reduction in the bad debt expense to £1.3 million (2021: £2.0 m).

Financial highlights:

  • Record total accounting return of 25.0% (2021: 11.4%) driven by a 20.4% increase in EPRA NTA per share to £1.7 (2021: £1.47);
  • Declared 6.85 pence per share covered total dividend for the year (2021: 6.75 pence);
  • IFRS profit before tax doubled to £107.5m (2021: £53.0 million), driven by MLI valuation uplifts of £89.5m compared with £26.9m in the prior year;
  • 20.8% like-for-like valuation growth along with new acquisitions helped increase total MLI portfolio valuation to £653.5 m. Including the share of the jointly owned care homes portfolio, the total portfolio valuation was £685.8m at year end (2021: £582.3m);
  • 96.7% increase in diluted IFRS EPS to 36.68 pence (2021: 18.57 pence) with adjusted EPS increasing to 6.88 pence per share (31 March 2021: 6.78 pence);
  • 20.3% increase in diluted IFRS net asset value per share to £1.78 (2021: £1.48);
  • Low loan-to-value of 25.6% (2021: 28.1%) with total debt of £196.2 million, including the share of joint venture debt, and unrestricted cash balances of £20.7 million at year end.
LXi REIT Plc (LON:LXI, 142.4p, 142.6p, -0.1%)

LXi REIT reported full year results. Key highlights included:

  • EPRA net tangible assets ("NTA") per share of 142.6p (up 13.4% on prior year);
  • Total NAV return of 18.2% comprising NAV growth and dividends paid during the year. Since IPO, the Group has delivered an annualised total NAV return of 11.2% pa, well ahead of its 8%+ medium-term target;
  • Portfolio independently valued at £1,544.4m reflecting like for like growth of 10.5% in the year. The growth was broadly spread across sub-sectors as follows:
    • Foodstores and essentials like for like growth of +10.2%;
    • Industrial assets like for like growth of +18.5%;
    • Hotels like for like growth of +4.3%;
    • Healthcare like for like growth of +4.2%;
    • Car parks like for like growth of +3.4%;
    • Pubs like for like growth of +10.4%;
    • Garden centres like for like change of +9.9%.
  • Loan to value ("LTV") ratio of 22% with significant headroom to medium-term borrowing policy cap of 35% and banking covenant of 50%;
  • Adjusted EPS of 7.0p (31 March 2021: 7.5p), down slightly on the prior year as a result of the significant increase in scale of the Group's capital base during the year, but still representing 1.17x dividend cover;
  • Dividends paid and declared in respect of the year total 6p per share (31 March 2021: 5.55p), up 8.1% on the prior year;
  • Gross equity proceeds raised of £354m in the year and fully deployed into a pre-identified pipeline of accretive assets that further strengthened the Group's portfolio.
New River REIT Plc (LON:NRR, 88.3p, 134.0p, -34.1%)

New River REIT announced full year results. Key details are:

  • Underlying Funds From Operations increased to £28.3m (FY21: £11.5m);
  • UFFO per share increased to 9.2p (FY21: 3.8 pence);
    Final dividend of 3.3p per share, bringing total FY22 dividend to 7.4p per share, fully covered by UFFO (FY21: 3.0p);
  • Retail Net Property Income up 9.7% to £51.8m (FY21: £47.2m);
  • Retail portfolio valued at £649m; Portfolio delivered +7.5% Total Return in FY22 and returned to capital growth in H2 with valuations +2.6%;
  • Retail IFRS profit after tax of £7.0m (FY21: loss of -£122.1m);
  • EPRA NTA per share down 11% to 134p due to Hawthorn disposal, but increased from 131p at 30 September 2021 due to return to capital growth in H2;
  • Completed £77.1m of retail disposals at 2.1% discount to latest valuation;
  • Largest retail transaction was the disposal of a Regeneration shopping centre in Cowley, Oxford, for gross proceeds of £38.8m;
  • LTV reduced from 50.6% at 31 March 2021 to 34.1% at 31 March 2022;
  • Fully unsecured balance sheet with drawn Group debt reduced by £335m;
  • Significant cash and available liquidity of £213.2m, including £88.2m of cash;
  • Net debt reduced by 55% to £221.5m (31 March 2021: £493.3m);
  • No maturity on drawn debt until 2028 and no exposure to interest rate rises on drawn debt;
  • Rent collection for FY22 of 96% - significantly ahead of 86% last year - and Q1 tracking at over 90% cash collection;
  • 1,039,800-sqft of new lettings and renewals completed across the portfolio; long-term transactions at average 7.4% premium to ERV;
  • High, stable retail occupancy of 95.6% (31 March 2021: 95.8%).


Palace Capital Plc (LON:PCA, 269.0p, 390.0p, -31.0%)

Palace Capital, property investment company with a diversified portfolio of UK commercial real estate with a focus on the office & industrial sectors, announced its preliminary results for the year ended 31 March 2022. Key details are:

  • Adjusted profit before tax increased by 4.0% to £7.8m (2021: £7.5 million);
  • IFRS profit before tax of £24.6 million (2021: £5.5m loss), driven by disposal strategy, revaluation gain and trading profit;
  • Like-for-like portfolio valuation increase of 3.9% (2021: 4.0% decrease);
  • Total Property Return of 12.5% for the year (2021: 1.0%);
  • EPRA NTA per share increased by 11.4% to 390p (2021: 350p);
  • Total Accounting Return of 14.8% (2021: minus 1.2%);
  • LTV reduced to 28% (2021: 42%) as a result of £45.3 million reduction in net debt;
  • Total dividends paid or declared for the year increased by 26.2% to 13.25 pence per share (2021: 10.50 pence per share) and total dividends paid increased by 56.7% to 11.75 pence per share (2021: 7.50 pence per share);
  • Disposal strategy ahead of target with £31.5m of gross proceeds achieved, delivering an ungeared IRR of 11%. 55 lease events completed in the period totalling 319,000-sqft at an average of 11% premium to ERV;
  • An additional £1.9m of annualised net rental income gained in the year through asset management lease activity, acquisitions, and reduction in non-recoverable property costs. This takes into account income lost through disposals, lease expiries and lease breaks;
  • Portfolio repositioning in the year has delivered a higher quality portfolio consisting of 37 properties, improved EPC ratings (which support future rental uplifts), higher occupancy and weighting to core assets;
  • 98% rent collection for the 12 months to 31 March 2022;
  • Overall EPRA occupancy of 88.5% (2021: 86.4%), with majority of remaining vacancy having been recently refurbished or identified for strategic refurbishment or redevelopment;
  • WAULT of 4.7 years to break, 6.5 years to expiry, reflecting flexible lease terms;
  • Increased prioritisation of ESG initiatives and incorporated energy efficiency measures into capital expenditure projects.


Regional REIT Ltd (LON:RGL, 72.3p, 97.2p, -25.6%)

Regional REIT, the regional office specialist, announced the acquisition of three separate investments in Sheffield city centre, Thorpe Business Park, Leeds, and Leeds city centre for £8.5m, £8.6m, and £9.4m respectively, reflecting attractive net initial yields of 9.2%, 7.1% and 7.7%, with an overall blended net initial yield of 8.0%.

1 North Bank, Sheffield (totalling 58,893 sqft):

  • Five floors of recently refurbished Grade A office space; EPC C with a clear plan to enhance the ratings further for minimal capital expenditure;
  • 98.4% occupancy; major tenants include Social Work England and XLN Telecom Ltd;
  • Located to the north of the city centre, with excellent rail and road links and 70 car parking spaces;
  • Contracted rent of £0.8m (£14.09 \ sq. ft.); WAULT to first break of 2.0 years and 4.5 years to expiry.

Thorpe Park, Leeds (totalling 31,101 sqft):

  • Two floors of recently fully refurbished office space; EPC A first floor and EPC B ground floor;
  • 100% occupancy; major tenants include Homeserve Membership Ltd. and SpaMedica Ltd;
  • Excellent road links with 154 car parking spaces;
  • Contracted rent of £0.7m (£21.21 \ sqft); WAULT to first break of 3.9 years and 6.7 years to expiry;

Albion Street, Leeds (totalling 34,196 sqft):

  • Six floors of recently fully refurbished well specified office space and retail on the ground floor; EPCs range from B to D with a clear plan to enhance the ratings further for minimal capital expenditure;
  • 99.0% occupancy; major tenants include Specsavers, Akari Care Ltd., and The National Association of Citizens Advice Bureaux;
  • Located in the heart of Leeds city centre, with 14 car parking spaces, being rich in amenities and extremely well served by transport connections;
  • Contracted rent of £0.8m (£22.55 \ sqft); WAULT to first break of 1.2 years and 2.5 years to expiry.


Safestore Holdings Plc (LON:SAFE, 1,061.0p, 596.0p, +78.0%)

Safestore Holdings announced interim results. Key details are:

  • Group revenue up 14.6% and in CER up 15.9%;
  • Group like-for-like storage revenue in CER up 16.4% and like-for-like total revenue in CER up 14.5%;
  • Strong operational gearing driving growth in Adjusted Diluted EPRA EPS, up 24.3% at 22.5p (2021: 18.1p);
  • 25.3% increase in the interim dividend to 9.4p (2021: 7.5p) reflecting improved profitability;
  • Profit before income tax of £285.2m up from £167.3m in 2021 driven by strong trading performance and increased gain on investment properties of £223.9m (2021: gain of £127.7m);
  • Strong conversion of profitability to cash with Cash Inflow from Operating Activities up 24.6% to £54.7m;
  • Adjusted Diluted EPRA Earnings per Share expected to be at least 47p for the full year;
  • Strong like-for-like operational performance:
    • Like-for-like average storage rate for the period up 13.0% in CER:
      • UK up 15.9% to £28.67 (2021: £24.73);
      • Paris up 4.6% to €40.44 (2021: €38.67);
      • Spain up 7.8% to €34.09 (2021: €31.61).
    • Like-for-like occupancy up 0.4ppts at 82.3% (2021: 81.9%):
      • UK up 0.3ppts at 82.1% (2021: 81.8%);
      • Paris up 1.2ppts at 82.9% (2021: 81.7%);
      • Spain down 2.8ppts at 86.6% (2021: 89.4%).
  • Completed EPS accretive acquisition of remaining 80% of equity owned by Carlyle in the Benelux JV14 in March 2022 at an Enterprise Value of €146m. The Benelux business consists of 15 high quality stores with an MLA of 600,000 sqft in the Netherlands and Belgium;
  • Acquisition of a single 14,000 sqft satellite store from Your Room Self Storage in Christchurch, Dorset, for an Enterprise Value of £2.45m;
  • New freehold development sites acquired:
    • Three in the greater Paris area subject to planning providing a total of c. 134,000 sqft;
    • 58,000 sqft site in Netherlands subject to planning;
    • Site in Wigan in Greater Manchester. Planned conversion of existing building to a 42,700 sqft new store.
  • Opened c. 154,000 sqft of new freehold space across the London Bow (74,000 sqft) and Nijmegen, Netherlands. (40,000 sqft) sites and extensions of existing stores in London at Paddington Marble Arch and Edgware and in
  • Southend;
  • Total Group development and extension pipeline now 23 stores and c. 983,000-sqft of MLA;
  • Group loan-to-value ratio ("LTV") at 27% (2021: 27%) and interest cover ratio ("ICR") at 10.0x (2021: 10.0x);
  • Unutilised bank facilities of £198.5m at 30 April 2022.


Schroder European REIT Plc (LON:SERE, 101.5p, 148.9p, -31.8%)

Schroder European Real Estate Investment Trust announced its half-year results for the six months ended 31 March 2022. Key details are:

  • NAV total return of 5.5% (31 March 2021: -0.4%);
  • IFRS profit of €10.9m (31 March 2021: €0.7m loss), primarily driven by yield compression and ERV growth across the industrial and DIY portfolio and the release of €1.4m of the Paris BB development post-tax profit;
  • Ordinary dividends declared of €4.9 m/3.7 cps and a second special dividend declared of €6.4 m/4.75 cps for the six months to 31 March 2022;
  • Net Asset Value ('NAV') decreased 0.2% to €199.1m or 148.8 cps (30 September 2021: €199.5 m), reflecting the payment of the Company's first special dividend of €6.4m in January 2022;
  • Underlying EPRA earnings of €2.5m (31 March 2021: €2.8m); this is expected to increase with the redeployment of the Paris BB sale proceeds;
  • Low loan to value ('LTV') of 18% net of €36.9m of available cash (28% gross of cash), with a low weighted average total interest rate of 1.4%;
  • Portfolio value increased to €247.9m (directly held real estate portfolio only and including cash) (31 September 2021: €215.7 m) including like-for-like growth of 4.0%, or €8.0m (net of capex over six months);
  • Continued income resilience, with 100% rent collection over the period; high portfolio occupancy of 95%; and an average lease term to expiry of 4.5 years;
  • 100% of leases benefit from inflation-linked rent reviews offering strong inflation hedge;
  • Paris BB refurbishment delivered to business plan in Q2 2022;
  • Acquisition of a €1.7m industrial acquisition in Venray, the Netherlands, reflecting a net initial yield of 5.3% with a reversion to 7.6%, followed by the post-period commitment of a €8.4m car showroom in Cannes, France, reflecting a net initial yield of 5.5% with a reversion to 6.4%;
  • Significant cash reserves with potential investable firepower, including debt, exceeding €50 million.


Schroder REIT Plc (LON:SREI, 52.0p, 75.8p, -31.4%)

Schroder Real Estate Investment Trust announced its audited full year results for the 12 months ended 31 March 2022. Key details are:

  • Net Asset Value ('NAV') increased 25.4% to £372.2m or 75.8 pps (31 March 2021: £296.8 million or 60.4 pps);
  • NAV total return for the year to 31 March 2022 of 30.9% (31 March 2021: 3.9%);
  • EPRA earnings of £15.7 m, an increase of 35.3% (31 March 2021: £11.6 million);
  • IFRS profit of £89.4m (31 March 2021: £4.5 m);
  • Continued outperformance of the underlying portfolio with a total return of 23.5% compared to 19.9% for the MSCI Benchmark Index;
  • Loan to value, net of all cash, of 28.6%, within the long-term strategic range of 25% to 35%;
  • £12.5m of cash, including share of joint ventures, and £42.3m of undrawn debt facilities, including the post year end increase of the revolving credit facility, providing operational and financial flexibility;
  • Dividends reinstated to the pre-pandemic level. Dividends totalling £13.9m, or 2.83 pps, paid during the financial year, reflecting dividend cover of 113% based on EPRA earnings;
  • Rent collection stabilised at pre-pandemic level: 96% collected for the quarter ending 31 March 2022, and recovery of certain amounts previously provided for as bad debt;
  • Disposal of Nottingham office asset for £13.0 m, realising a £3.2m gain in the financial year and a 12.4% per annum total return since acquisition in August 2018;
  • Acquisition of four industrial assets in the north-west of England for £19.9 m, reflecting a net initial yield of 6.9%, a reversionary yield of 8.2%, and a low capital value of £53 per sqft;
  • Commenced development of 11 net zero carbon warehouse and trade units in Cheadle, Greater Manchester, totalling 80,000 sqft at a cost of approximately £8.5 million;
  • Post year end acquisition of St. Ann's House, a mixed-use office and retail asset in Manchester City Centre, for £14.7m, reflecting a net initial yield of 7.8%, a reversionary yield of 9.1% and a low average capital value of £283 per sqft;
  • 72 new lettings, renewals and reviews completed (as at 6 June 2022), totalling £3.9m per annum of rental income and reflecting an annualised increase of £1.6m on the previous contracted rent.

Schroder Real Estate Investment Trust announced that a 26,975-sqft single let industrial asset in Portsmouth has been sold for £6.5m. The price compares with the 31 March 2022 independent valuation of £4.9m and reflects a net initial yield of 3.2%. Situated within the Walton Road Industrial area, the Company acquired Southlink in July 2004. The asset produces a net rent of £225,000 per annum with a lease term of 2.4 years. Based on the disposal price, the asset has generated an ungeared total return of 13.2% per annum since acquisition.

Since 31 March 2022, the Company has completed 17 new lettings, renewals and reviews across 427,121 sqft. The transactions will generate £2.7 million per annum of rental income and increase contracted rental income by £1.0 million per annum.


Tritax Big Box REIT Plc (LON:BBOX, 181.5p, 194.2p, -6.5%)

Tritax Big Box REIT announced that is has successfully leased one million sqft across four buildings at its Symmetry Park Rugby development site to a global leader in storage and information management services (the Customer).

These logistics facilities will support the new Customer's growth ambitions by enabling it to create its first UK campus, capable of delivering a full range of services for its clients. The lettings also support the development programme at Tritax Big Box's Rugby site, which benefits from planning consent to deliver approximately 1.9m sqft of logistics space and access to key transport infrastructure.


Unite Group Plc (LON:UTG, 1,064.0p, 880.0p, +20.9%)

Unite Students, the UK's largest provider of student accommodation, has committed to donating 1% of annual profits to social initiatives going forward, amounting to a commitment of c. £2m a year. These initiatives will be closely aligned to its purpose of providing a Home for Success for students and its aim of widening participation in higher education. There will be two main funding streams in 2022. The first covers Unite Students' Leapskills programme - an interactive set of workshops designed to prepare school leavers for independent living at university. The second will cover the Unite Foundation, the charitable trust founded by Unite Students in 2012, which provides free accommodation for care leavers and estranged students while at university.


Urban Logistics REIT Plc (LON:SHED, 161.5p, 188.8p, -14.5%)

Urban Logistics, the last mile logistics focused REIT, reported its results for the year ended 31 March 2022. Key details are:

  • Property valuation uplift of £153m, 25.4% growth on a like for like basis;
  • Net rental income of £36.5m (+59.8% on FY21);
  • Total Property Return of 30.3% (FY21: 17.1%);
  • IFRS profit before tax of £172m (+261% on FY21);
  • Adjusted EPS (which includes impacts of capital raise) of 6.71p (FY21: 6.76p);
  • Total Accounting Return of 29% for the year and 16.4% p.a. since IPO to 31 March 2022;
  • Total dividend per share for FY22 of 7.60p (FY21: 7.60p);
  • EPRA NTA share of 188.8p (+ 23.9% on FY22);
  • Weighted average cost of debt for the year of 2.55%, with 74% hedged (FY21: 2.89%, with 69% hedged);
  • Debt of £239m includes an £88m facility with sustainability linked metrics;
  • LTV 11.3% (FY21: 27.9%);
  • Significant capital deployment in FY22:
  • Acquisitions: £282 million aggregate consideration, weighted average NIY of 5.3%;
  • Developments: 9 forward funding agreements with £52.9 million deployed, current yield on cost of 6.7%.
  • Total portfolio of 113 mid box urban logistics assets covering 8.3 million sqft with a valuation £1,015m (+99.9% on FY21);
  • Affordable average rent per sqft of £5.59; Low EPRA vacancy rate of 6.9% (FY21: 6.9%);
  • High gross to net rental income ratio 97.2% (FY21: 96.5%);
  • High rent collection: 99.9% of FY22 rents demanded were collected (FY21: 99.9%);
  • WAULT of 7.7 years (FY21: 7.4 years);
  • 25 new lease events completed during the year, with 16.4% like-for-like rental increases.


  • Well capitalised and on track to be fully deployed following the December fundraise in the first half of the financial year, at a blended NIY in excess of 5%;
  • Well balanced portfolio which allows for future growth in rents and values through asset management initiatives;
  • Targeting an LTV at the lower end of the 30-40% LTV range, and anticipating a year of modest improvement in earnings, with the dividend expected to be at least maintained;
  • Continued strong sector supply/demand dynamics providing inflation beating continued upward momentum on rents;
  • Strong tenant base, which is focused on key areas of the supply chain and likely to be less susceptible to broader economic headwinds.
Workspace Group Plc (LON:WKP, 556.0p, 988.0p, -43.7%)

Workspace Group, the leading provider of flexible space, announced its Full Year Results for the year ended 31 March 2022. Key details are:

  • Trading profit after interest up 21% to £46.9m driven by 6.4% (£5.2m) increase in net rental income to £86.7m;
  • Total dividend up 21% to 21.5p per share (2021: 17.75p) reflecting the strong financial performance;
  • Property valuation of £2,402m, an underlying uplift of 3.0% (£69m) from 31 March 2021;
  • EPRA Net Tangible Assets (NTA) per share up 5.3% to £9.88 with total accounting return of 8.0%;
  • Loan to value of 23% (2021: 24%);
  • Profit before tax of £124.0m (2021: £235.7m loss), with increases in both trading profit after interest and the property valuation;
  • Customer demand running at pre-Covid levels;
  • 1,520 lettings completed in the year with a total rental value of £30m;
  • Like-for-like occupancy up 7.8% to 89.6%;
  • Like-for-like rent roll up 8.7% to £92.9m with rent per sqft up 0.4% to £36.39;
  • Pricing tension increasing with like-for-like rent per sqft up 2.5% in the second half of the year.


  • Focus on future-proofing properties for long-term climate resilience;
  • Committed to be a net zero carbon business by 2030;
  • Extensive project pipeline repurposing, upgrading and breathing new life into buildings;
  • Generating hubs of economic activity to create a flatter, fairer and more sustainable London;
  • 20% reduction in Scope 1 and 2 emissions achieved in the year compared to 2019/20.

Portfolio activity:

  • Acquired The Old Dairy, Shoreditch for £43m in September 2021;
  • Acquired Busworks, Islington for £45m in November 2021;
  • Post year-end completed the acquisition of McKay Securities PLC for £258m in May 2022;
  • Sold 13-17 Fitzroy Street, Fitzrovia for £92m in September 2021;
  • Sold Highway Business Park, Limehouse for £24m in March 2022;
  • Completed the refurbishment of Pall Mall Deposit, Ladbroke Grove in September 2021;
  • Opened Mirror Works, a new business centre in Stratford in October 2021 


Data sourced through the London Stock Exchange and RNS announcements.