Tritax Big Box REIT’s development programme turbo-charged returns for the year to 31 December 2021.
The group posted impressive gains in earnings, portfolio valuation uplifts and profit in the year. NAV total return for the year was a whopping 30.5%.
Adjusted earnings per share was up 14.8% to 8.23p, while the group upped its dividend for the year by 4.7% to 6.7p per share.
The group’s portfolio grew in value by 24.3% to £5.48bn, driven by development gains and asset management activity. This helped EPRA net tangible assets (NTA) grow 26.8% in the year to 222.6p per share.
Operating profit was up 20.7% to £178.0m.
Contracted annual rent increased 8.3% to £195.6m, with rent reviews conducted during the year achieving an 8.7% uplift. Estimated rental values (ERV) across the portfolio rose 7.5% over the year.
Development activity
The group leased 3.7 million sq ft of of space in the year, adding £24m to contracted rent. A total of 1.3 million sq ft of developments are under construction, with the potential to add a further £10.2m to contracted rent, of which 21% has been let.
It also secured 3.0 million sq ft of new planning consents and has started construction on 1.8 million sq ft this year, adding a potential £13.1m of contracted rent, of which 56% has been pre-let.
The group said it was increasing its target development starts for 2022 to 3-4 million sq ft and £350-400m of capex, compared to a long-term target run rate of 2-3 million sq ft per annum.
The group added it was in active negotiations to lease more than 10 million sq ft of space over 11 sites and had a total near-term development pipeline of 8.8 million sq ft with £60-70m of rent potential. It said it was maintaining a target yield on cost of between 6-8%.
Aubrey Adams, chairman of Tritax Big Box REIT, said: “This was an excellent year for Tritax Big Box. With all areas of our business performing well, we delivered our strongest results to date with total accounting returns of 30.5%.
“Our performance is underpinned by the alignment between our strategy, the extensive capabilities and activity of our manager, and the long-term structural changes in our market. With a strong balance sheet, we have the financing capacity to accelerate our development programme, enabling us to capture a growing share of the unprecedented levels of occupier demand in the market.
“In parallel, we continue to actively manage our investment portfolio to maximise returns through lease reviews & extensions, physical extensions and acquiring and disposing of assets. This demand, combined with continued constrained supply, is contributing to strong rental growth and rising capital values, reinforcing our ability to deliver further attractive total returns to shareholders over the coming years.”
BBOX : Developments paying dividends for Tritax Big Box REIT