The dedicated real estate stock exchange – IPSX (International Property Securities Exchange) – is winding down having struggled to find new investment.
Launched in 2019, the exchange, which allows investors to invest in real estate investment trusts made up of a single asset or a group of assets with commonality, has just three companies listed.
Mailbox REIT, a single mixed-use asset in Birmingham, was the first to list on the exchange in May 2021.
It has since seen its share price fall by more than 20%, with the value of the property – a former Royal Mail sorting office – hit by the current higher interest rate environment. The company also defaulted on its debt, which it is looking to refinance.
The company said it was “finalising arrangements for listing and trading on an alternative platform, where access to trading and liquidity will be improved”.
M7 Regional E-Warehouse REIT, which invests in a diversified portfolio of warehouse properties across the UK, said it was “considering all options available to the company so as to maintain its REIT status” which includes the private REIT structure as well as alternative listing platforms.
BWP REIT, another single-asset REIT which owns Bridgewater Place in Leeds, is also investigating alternative platforms for listing and said it believed there are “a number of viable options”.
IPSX has confirmed that its secondary market operations will continue trading through the wind-down period of 90 days from 4 September and that the ability to buy and sell shares may continue until the date that admission is cancelled.
[QD comment: After four years and just three listings, the writing was on the wall for the IPSX. It can blame bad luck to some degree, with rising interest rates and economic uncertainty choking off new investment, but it seems to me that from the start it was offering a solution to a problem that did not exist. Investors can gain access to established REITs through the many established stock exchanges that offer greater liquidity.]
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