Register Log-in Investor Type


Civitas NAV rises in first quarter

Civitas targeted by short-seller

Civitas NAV rises in first quarter – the following announcement was released at 7:00am this morning

“The Board of Civitas Social Housing PLC (“Board”), a leading London listed Real Estate Investment Trust (“REIT”) dedicated to investing into regulated social housing in England and Wales, is pleased to announce its quarterly net asset value (“Net Asset Value” or “NAV”) as at 31 March 2019.


  • IFRS NAV per share up 0.6% to 107.1p during the quarter (31 Dec 106.5p)
  • 34 additional properties acquired during the period.
  • A number of existing leases have seen rental increases from indexation.
  • Annualised rent roll £45.7 million at 31 March 2019.

Net Asset Values:


The unaudited IFRS NAV, disclosed below, reflects an independent RICS “Red Book” valuation prepared on an individual asset basis by Jones Lang LaSalle Ltd.


IFRS NAV 31 March 2019 31 December 2018
Ordinary NAV (£’000) 666,508 663,091
Ordinary NAV per share (pence) 107.1 106.5

In the period to 31 March 2019 an Ordinary Share dividend of 0.14p per share was declared and paid amounting to £0.9 million.

Portfolio NAV

The unaudited Portfolio NAV, disclosed below, reflects an independent RICS “Red Book” valuation prepared on a portfolio basis by Jones Lang LaSalle Ltd (“JLL”).

PORTFOLIO NAV 31 March 2019 31 December 2018
Ordinary NAV (£’000) 741,170 716,567
Ordinary NAV per share (pence) 119.1 115.1

A significant amount of investment was made in the quarter increasing the size , diversification and quality of the portfolio further. These changes in the scale of the portfolio has led to JLL reducing slightly the valuation yield at which the properties are held under the Portfolio NAV which in turn has resulted in a valuation increase in the Portfolio NAV.

The JLL Portfolio valuation incorporates two additional assumptions when considering the Red Book valuation. First that the assumed sale costs (from Civitas to a subsequent buyer) are reduced as the portfolio is assumed to be sold (with all properties within SPVs) with stamp duty being charged at 0.5% on the sale of shares in SPVs as opposed to 5.0% for the sale of each underlying property.

Secondly the portfolio is sold rather than individual properties making it better suited to a wider group of institutional buyers and so attracting more competitive prices (5.00% cap rate as opposed to 5.27% under IFRS) which is supported by transactional evidence that JLL has observed in the market.

Investment Update

During the period, 34 additional properties were acquired and a number of the existing leases entered into by the Company have seen their rental income increase as a result of annual indexation, which taken together has resulted in a run-rate of rental income at 31 March 2019 of £45.7 million. This is expected to grow further as the Company moves towards target leverage levels of 35% over the coming months, enhancing shareholder return and supporting the Company’s target dividends.

The growth in rental income has been unaffected by the regulatory judgements issued by the Regulator of Social Housing.

In the period since IPO, the Company has made the following investments and created a quality, nationally-based, diversified portfolio of regulated social housing in England and Wales as well as partnering with new housing associations and care providers in new local authorities:


Period 31-Mar












30-Sept 2018 31-Dec 2018 31-Mar 2019
Investment* (£m) 106 206 284 431 472 508 619 674 758
Properties 82 167 282 384 414 440 521 557 591
Tenancies 487 1,130 1,820 2,405 2,621 2,845 3,440 3,746 4,075
Local Authorities 32 68 82 99 109 123 140 144 157
Housing Associations 5 7 10 10 11 12 15 15 15
Care Providers 25 42 50 59 64 71 93 98 113

*excluding purchase costs, including completed properties only.

 The Company is targeting 35% leverage, which would provide approximately £170 million of further funds to invest. The Company is currently in negotiations to put in place these debt facilities.

Market Update

The demand for affordable housing of all types continues to grow at a much faster pace than supply. Against a backdrop of house price volatility and uncertainty driven by Brexit and other macro factors many larger housing associations have started to reduce their homes for full market sale programmes and this in turn has a knock-on effect of reducing the profit subsidy that can be reallocated to affordable housing and so may lead to a reduction in future supply.

As we work at a local authority level it is clear that there is increasing demand for specialist supported housing as a cost effective and ethical way to deliver care in the community as opposed to more expensive hospital based provision. We expect this to continue into the future and we are working at a strategic level with many leading care providers and other property owners in order to develop transactions that meet specific needs and requirements. This enables us to take a pro-active role in the design and promotion of schemes to ensure that they are of the best quality and truly meet the long-term needs of particular individuals.

The Regulator of Social Housing (“RSH”) has continued to comment on the results of reviews undertaken on a number of housing associations that operate in the specialist supported housing sector, a process that started in May 2018. These organisations are now working with the RSH to develop and enhance their operations, and Civitas is actively supporting these activities.

The RSH also recently published an addendum to its annual risk profile report regarding the specialist sector. Since this time Civitas has, as part of its regular engagement, met with the RSH on several occasions for detailed discussions and most recently Civitas hosted a panel discussion with the RSH at the Social Housing Finance Conference held in London on 9 May 2019. Civitas was invited to undertake this role by a leading sector publication. As part of the discussion the RSH emphasised that specialist housing associations needed to articulate in a better way their contingency planning and how they address risk mitigation. The RSH also noted that there were “growing pains” in the sector but that “there were no inherent problems with the model”.


On 8 May 2019, the Board announced a quarterly dividend for the period from 1 January 2019 to 31 March 2019 of 1.325p per Ordinary Share. The dividend will be paid on or around 7 June 2019 to holders as at 17 May 2019 (the record date) and the corresponding ex-dividend date being 16 May 2019. The dividend will be paid as a REIT property income distribution (“PID”).

The Board has also announced that the Company intends to target a dividend of 5.3 pence per share in the financial year ending 31 March 2020.

Quarterly Fact Sheet

The Company has today published its Fact Sheet for the quarter to 31 March 2019 and this is available to view on the Company’s website. [and here]

Capital Markets Day

Civitas will today host a Capital Markets Day for investors and analysts in London, to give greater insight into the structure and operations of the company and the sector.

A copy of the presentation will be published on the Company website shortly after the event.  No new material information will be provided.”

CSH : Civitas NAV rises in first quarter

Leave a Reply

Your email address will not be published. Required fields are marked *

Please review our cookie, privacy & data protection and terms and conditions policies and, if you accept, please select your place of residence and whether you are a private or professional investor.

You live in…

You are a…