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Warehouse REIT posts 33.2% NAV total return as it gears up for main market move

Warehouse REIT delivered a NAV total return for the year to 31 March 2022 of 33.2%, as it gears up for a move from AIM to the main market.

EPRA net tangible assets (NTA) per share was up 28.6% to 173.8p (31 March 2021: 135.1 pence), thanks to a large increase in the value of its portfolio which nudged above £1bn for the first time (£1.012bn) from £792.8m a year prior, with a like-for-like increase of 19.4%.

Dividends totalled 6.4p in respect of the year, ahead of its full-year target of at least 6.2p, while EPRA earnings per share was also 6.4p.

The group had bank debt totalling £271m and cash balances of £16.7m at the year end, resulting in a loan to value (LTV) ratio of 25.1% (31 March 2021: 24.6%).

The company has also announced today its proposed admission to the premium segment of the main market and cancellation of trading on AIM, which should happen in July. The move should open up its shares to a wider pool of investors and improve the liquidity of its shares.

Operational highlights

The company acquired six investment assets totalling 176,500 sq ft plus adjacent development land, for £43.4m and reflecting a blended net initial yield of 4.2%. It also exchanged contracts to acquire an asset via a forward funded development arrangement for £35.0m, with a 12-month rent guarantee agreed with the vendor.

It completed 116 lease events across 0.9 million sq ft of space, contributing to like-for-like rental growth of 3.0%. This comprised 62 new lettings, generating rent of £2.8m per annum at 3.0% ahead of estimated rental value (ERV) and 54 lease renewals, securing income of £3.0m and achieving a 22.2% increase over previous contracted rents. The ERV across the portfolio has grown by 6.0% on a like-for-like basis.

Occupancy across the portfolio fell to 93.7% (31 March 2021: 95.6%), while effective occupancy, which excludes units undergoing refurbishment or under offer to let, was 95.8% (31 March 2021: 98.2%). The portfolio had a WAULT of 5.6 years at the period end (31 March 2021: 5.8 years).

The group collected 98.7% of rent due in the year.

Post period end, the group has exchanged contracts to acquire Bradwell Abbey Industrial Estate, Milton Keynes, for £62.0m, extended its revolving credit facility (RCF) by £25.0m, and signed an agreement with Panattoni to accelerate the development of its logistics park situated at Radway 16, Crewe just off J16 of the M6 motorway.  The project will start on site Q4 2022 with first buildings being available for occupation 2023.

Neil Kirton, chairman of Warehouse REIT, said:

“This has been another good year for the Group. The successful execution of our strategy since IPO has generated significant value for shareholders, as our high-quality portfolio has benefited from the consistent rerating of the asset class. We see further upside from the development potential of the land within the portfolio. The Company’s move to the Main Market, which we have confirmed today, will make the shares available to a wider range of investors and increase their liquidity. In turn, this will help us to continue to deliver our strategy and create further value for all our stakeholders.”

WHR : Warehouse REIT posts 33.2% NAV total return as it gears up for main market move

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