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Stenprop posts NAV total return of 11.4%

Stenprop, the multi-let industrial (MLI) property company, has posted a NAV total return for the year to 31 March 2021 of 11.4%.

This was made up of a 6.5% increase in EPRA net tangible assets (NTA) to 147p per share and dividends paid of 6.75p in the year.

The group’s portfolio, which is now 74.3% weighted to UK multi-let industrial properties and is on target to be 100% by March 2022, increased in value by 6.3% on a like-for-like basis to £582.3m.

Adjusted earnings per share for the year was 6.78p (31 March 2020: 6.88p), the drop mainly reflecting a bad debt expense of £3m due to COVID-19.

MLI performance

  • Like-for-like rental growth across the MLI portfolio of 5.6% for the year (2020: 5.6%), driven by average uplifts from previous passing rents upon new lettings and renewals of 16.3%.
  • MLI portfolio vacancy fell to 6.3% on 31 March 2021 from 9.0% on 31 March 2020 because of high demand and limited supply of MLI units in the market
  • estimated rental value (ERV) across the portfolio grew 6.2% to £6.16/sq ft (2020: £5.80/sq ft), reflecting a 12.8% premium to the average passing rent of £5.46 sq ft (2020: £5.27/sq ft)
  • Robust rent collection of 90%
  • User of its online platform Industrials.co.uk up 75% year on year

MLI transition

  • 14 individual MLI estates, totalling over one million sq ft, acquired during the year for £91.5m in line with £90m target
  • Disposed of £79.5m of non-MLI assets in Germany, achieved at an average premium of 15% to the 31 March 2020 valuations
  • MLI assets now comprise 74.3% of total portfolio (2020: 58%) with Stenprop on target to reach 100% by 31 March 2022
  • Target to invest £100m this year on MLI assets

Paul Arenson, chief executive, said: “This has been a year of strong results and continued transformation for Stenprop. A combination of the efforts of our asset management team, the strength of occupier demand for our multi-let industrial space and the quality of our portfolio, led to a 10.1% increase, on a like-for-like basis, in the valuation of our MLI portfolio and underpinned like-for-like MLI rental growth of 5.6% for the year.

“We remain firmly on track to become a 100% UK MLI business by the end of the current financial year, having reached 74% by the year end, up from 58% at the start of the year. This has been driven by a successful investment and divestment programme, with disposal of our non MLI assets achieved at an average uplift of 15% on their valuations at the beginning of the year. The capital from these sales, along with our existing cash levels, will allow us to acquire approximately £100m of MLI assets over the coming financial year.

“We will continue to invest in our proprietary industrials.co.uk platform. It has been a key driver of performance, assisting us to deliver a record-breaking year of leasing activity, whilst the market intelligence it affords gave us the confidence to resume investment activity ahead of plan. Having committed to our MLI strategy over three years ago, we are starting to see the rewards of our conviction and believe the strength of the team, coupled with the favourable structural trends, position us to continue delivering strong results for shareholders.”

STP : Stenprop posts NAV total return of 11.4%

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