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QuotedData’s morning briefing 3 September 2021

In QuotedData’s morning briefing 3 September 2021:

  • Mercantile (MRC) has raised an additional £150m of long-term debt through the issue of three fixed rate, senior unsecured privately placed notes. The notes, which will be funded on 8th September 2021, are: £55m maturing in 2041 with a fixed coupon of 1.98%; £50m maturing in 2051 with a fixed coupon of 2.05%; and £45m maturing in 2061 with a fixed coupon of 1.77%. The net proceeds will be used to repay MRC’s short-term indebtedness of £80m and the balance of the proceeds will be available to be invested as and when attractive opportunities arise. Angus Gordon Lennox, chairman, said: “Given the increase in the company’s asset base over recent years, the board is very pleased to have been able to take advantage of current market conditions to re-balance the company’s borrowing levels at attractive rates and over different and longer time periods. This new debt will ensure that there are adequate facilities in place to maintain gearing levels and if the managers see appropriate, investment opportunities to be able to operate more fully across the company’s gearing range.” There has been no change in the permitted gearing range as set by the board, to limit gearing within the range of 10% net cash to 20% geared. The current level of net gearing is c. 9.6%
  • Stenprop (STP) has sold Trafalgar Court, its Guernsey office building for £55m to a subsidiary of Global Net Lease, the New York listed REIT. Net proceeds from the sale was £25.6m, after debt held on the asset was repaid. STP will deploy the proceeds into UK multi-let industrial assets, as part of its strategy to become 100% focused on the sector by March 2022. The sale increases STP’s UK multi-let industrial portfolio to 92%.]
  • LondonMetric Property (LMP) has sold a grocery asset in Liverpool for £10.2m, reflecting a net initial yield of 4.65%. The 29,000 sq ft asset was acquired in 2014 for £8.1m and is let to M&S and Aldi. It generates a rent of £0.5m a year and has a WAULT of 12.6 years. The sale price is line with the 31 March 2021 book value and crystallises a 26% profit on cost and an ungeared IRR of 9%.
  • Custodian REIT (CREI) has acquired a 20,012 sq ft office building on Fountain Street, Manchester, for £6.25m, reflecting a net initial yield of 6.1%. The property is let to Leyton UK, Meridian Healthcomms, Venditan and Fourthline with a WAULT to first break or expiry of 1.2 years and an aggregate rent of £406,704 per annum. The purchase will be funded from the company’s existing debt facilities, resulting in its loan to value (LTV) increasing to 25.2%.

We also have full-year results from Mid Wynd.

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