Green REIT has reported a 14.9% increase in its EPRA NAV to EUR1.52 per share, underpinning a 17.7% total return in the year to the end of June 2016. EPRA EPS increased 131% to 3.7 cents per share as contracted annual rents rose by 10% to EUR61.3 million. The proposed dividend is 4.6 cents – up 188% on last year.
The valuation of the portfolio rose to EUR1.24 billion at 30 June 2016, which reflects a 13% increase on assets held throughout the period. Acquisitions in the period increased in value by EUR30 million between their acquisition dates and 30 June 2016, reflecting a combined 15% increase on property cost.
On a sectoral basis, the industrial assets saw a 44% increase in value, partly as a result of the completion of an industrial unit which had been under construction during the year and an increase in the value of the developable land. The city centre office portfolio saw a 13% increase in value, suburban offices saw a 14.5% increase and the retail assets held saw an 11% increase in value in the year.
In the period from June 2015 to June 2016 the portfolio equivalent yield reduced by 50 basis points to 5%. This is partly as a result of extending the WAULT from 5 years to 7.8 years and also due to the various disposals and acquisitions in the period.
Looking at the overall return from the portfolio, the movement in equivalent yield is contributing approximately 50% to returns with income and rental growth accounting for the remaining 50%. The rental growth component is pulled back somewhat by rent free periods given on new lettings and lease renegotiations, which will flow through in the coming months.
They strengthened the portfolio through two strategic acquisitions, firstly the acquisition of full control of Central Park, increasing the Company’s ownership from 50 to 100 per cent, and secondly the acquisition of One Albert Quay, Cork’s flagship office building. They also disposed of four non-core properties in the period, acquired early in the recovery cycle, generating a profit on purchase price of 75 per cent.
They completed two industrial units during the year and have two office buildings under development, at Central Park and 32 Molesworth Street, scheduled for completion in December 2016. They say construction of One Molesworth Street in Dublin’s CBD is progressing well and on target, while construction of 4-5 Harcourt Road has recently commenced.
Total gearing remains low at 19.2%, with cash and undrawn facilities at year end of EUR121.4 million providing further capital for growth and development.
WAULT rose from 5 years at 30 June 2015 to 7.8 years at the end of the period as they secured EUR9.5m on annual rent through new lettings including a significant deal to provide space for Fidelity International in George’s Quay. Vacancy stuck around the 2% mark.
GRN : Green REIT reports strong results as yields tighten and rents grow