Alpha Real Trust (ARTL) has published its annual results for the year ended 31 March 2017. During the period, the trust’s NAV per share grew by 15.2% to 158.9p. It also paid a quarterly dividend of 0.6p (2.4p in total for the year). Its chairman, David Jeffreys, describes the period as a, “very active year for ARTL with new investments, capital recycling and asset management successes secured”. He also says that, “The potential realisation of c.£46 million from investment disposals this year and next will enable ARTL to further invest in its build to rent investments with the potential for capital investment in excess of £30 million in the next 12 months. This number does not include potential investment opportunities in other portfolio assets and new investment in the Company’s mezzanine portfolio.”
Highlights
The company provides the following highlights from its results:
- NAV per share 158.9p: 31 March 2017 (137.9p: 31 March 2016)
- Adjusted earnings per share of 7.4p for the year ended 31 March 2017 (7.0p: 31 March 2016)*
- Declaration of a quarterly dividend of 0.6p per share, expected to be paid on 21 July 2017
- Basic earnings per share of 18.6p for the year ended 31 March 2017 (23.1p: 31 March 2016)
- Balanced portfolio: continued capital allocation to a mix of investments which balance income returns while creating potential for capital value growth, including build to rent
- H2O Madrid: post period end, ARTL entered an agreement, subject to certain conditions, to form a joint venture with CBRE European Co-Investment Fund, who will acquire 70% of the shareholding in the asset. The agreement for the partial sale creates the opportunity to recycle capital and help rebalance ARTL’s investment portfolio while allowing for participation in the continued income yield and future value growth potential from the asset
- H2O Madrid new debt facility: post period end, ARTL refinanced the borrowings secured on the shopping centre with a new €65 million seven year bank debt facility
- H2O Madrid site purchase: acquisition of a vacant site in the same planning zone as H2O that, subject to transfer of building rights and planning permission, could create potential for the expansion of the H2O shopping centre
- Private rented sector residential: planning consent secured for the PRS developments: detailed consent for 162 units in central Birmingham and detailed consent for 307 units with outline consent for a further 300 units in central Leeds
- Mezzanine loan investment: agreement entered into with a specialist finance provider, to co-invest and create a portfolio of mezzanine loan investments. During the year £1.7 million was also invested in a new mezzanine loan with an annualised return in excess of 15% secured on a hotel located in central Newcastle
- Data centre: ARTL entered into an agreement to purchase, subject to planning, an industrial site which has potential for the development of a data centre; detailed planning and power applications have been submitted
- IMPT loan and equity divestment: post period end, ARTL redeemed its outstanding unsecured subordinated debt provided to IMPT of £10.9 million (including outstanding interest and exit fee); ARTL also sold its shares in IMPT for 330p (representing a receipt of £5.3 million), an increase over nine times ARTL’s initial acquisition price
- 95.0% of the Group’s portfolio is allocated to investments in the UK and Europe that are or are expected to be income producing
About Alpha Real Trust
Alpha Real Trust targets investment and development opportunities in real estate, including real estate operating companies, securities, services and other related businesses that offer high total returns. Alpha Real Trust’s investment manager will seek to identify investment opportunities where income and capital values can be enhanced where appropriate through: space reconfiguration where under-utilised or inefficient areas within a building can be re-arranged to provide more valuable space; refurbishment and redevelopment where space can be modernised and the specification upgraded to create space which can command higher rents; re-leasing, which has the potential to increase the rental income to an open market level, when this is in excess of the existing rent; space creation by extending the building to meet tenant demand; and change of use which can result in higher value use for certain areas of a building or for entire properties.
Alpha Real Trust posts NAV growth of 15.2% during year : ARTL