Real Estate Investors benefitting from vibrant midlands economy – The multi-sector midlands-focused property company, Real Estate Investors (RLE), has reported results covering the first-half period to 30 June 2019. RLE has a 1.53mn square foot commercial property portfolio across the region (Birmingham is the main portfolio city).
The portfolio was 96.2% occupied over the period (H1 2018: 92%) and currently generates an annualised contracted rental income of £17m (H1 2018: £15.6m) up 9%.
In June 2019, the government announced its plans to invest £778m in Birmingham and the west midlands in advance of staging the 2022 Commonwealth Games. RLE believes that as the only midlands-focused and Birmingham-based REIT, it is well positioned capitalise on any opportunities that major events, infrastructure and development projects bring to the midlands.
Dry powder waiting to be deployed
RLE says that it has £25m of cash and available bank facilities that can be used to grow its portfolio, which at 31 December 2018, was worth £225m. The company says it saw limited opportunities to add to the portfolio over the H1 period.
Retail holding up well and no material impact from CVAs
RLE says that the office element of the portfolio, which represents 39% of the total value, is performing well and, so far it is succeeding in mitigating against the issues faced by the traditional retail sector by focusing its strategy on neighbourhood and convenience retail. They note that they have been experiencing steady demand from occupiers and that their discount retailers continue to trade well, with rents received promptly from occupiers. They have had no material impact from company voluntary arrangement’s (CVAs).
RLE: Real Estate Investors benefitting from vibrant midlands economy