Standard Life Investments Property Income Trust has reported a 4.1% increase in net asset value (NAV) in the quarter to the end of December 2020.
NAV total return for the period (including the payment of dividends) was 5.0%.
The increase in NAV, to 82.0p per share from 78.8p in September 2020, was primarily down to a 3.3% uplift in the value of the group’s property portfolio.
Its favourable weighting to the industrial and logistics sector (48.2% by value) was behind the increase in portfolio value. The industrial assets rose by 6.5% in value in the quarter. The group’s portfolio was valued at £437.7m at the end of 2020.
Rent collection
The company said it has collected 91% of all rent due for the year of 2020 and expects this figure to increase slightly.
For the first quarter of 2021, the group has so far collected 74% of rent billed, which increases to 79% when monthly payments are taken into account.
It said it had made prudent assumptions for bad debt of £2.58m for 2020.
Dividends
The group has maintained the same level of quarterly dividend paid last quarter of 0.714p per share. This is 60% of last year’s level in the same quarter.
The board said it believed “this rate balances the need for shareholders to continue receiving income during this difficult period while maintaining a prudent approach given current rent collection rates”.
The company has continued to pay a dividend throughout the pandemic and in 2020 paid 3.8p per share, which equates to 80% of the 2019 level.
To satisfy REIT status to distribute 90% of annual property income, the group said it expects to pay a fifth interim dividend of at least 0.25p per share in May 2021.
Investment and letting activity
In late December the company completed the sale of four multi-let industrial estates for £37.75m, in-line with the previous valuation and during the period also completed the sale of a small office for £4.30m and small retail warehouse investment for £3.55m, at a small premium to the previous valuation.
Sales proceeds were used to repay £35m drawn under its Revolving Credit Facility (RCF) and also gives the company cash for investment.
Financial position
The group has financial resources available for investment of £55m through the RCF plus cash of £9.4m.
At 31 December 2020, its loan to value (LTV) was 23.0%, which provides sufficient headroom against banking covenants (bank LTV covenant is 55% and interest rate cover required is 175% v 595% achieved).
SLI : Standard Life Inv. Property Income posts 4.1% jump in NAV
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