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QuotedData’s morning briefing 9 January 2024 – UTG, CREI, HHI, HDIV

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In QuotedData’s morning briefing for 9 January 2024:

  • Unite Group (UTG) has released fourth quarter 2023 valuation information on its student accommodation portfolio. The group’s USAF property portfolio (27,922 beds in 71 properties across 19 university towns and cities in the UK) was independently valued at £2,992m at 31 December 2023, a 2.1% increase on a like-for-like basis during the quarter. The valuation increase in USAF is driven by quarterly rental growth of 2.8%, while the yield increased very slightly by 3 basis points to 5.3%. Over the past 12 months, valuation growth of 3.6% was driven by rental growth more than offsetting 21 basis points of yield expansion. The group’s LSAV’s property portfolio (9,716 beds across 14 properties in London and Aston Student Village in Birmingham) was independently valued at £1,922m, a 0.7% decline on a like-for-like basis during the quarter. The valuation decrease in LSAV was driven by quarterly rental growth of 2.5% and a 15 basis point increase in property yields to 4.5%. Over the past 12 months, the valuation is unchanged with rental growth offsetting 39 basis points of yield expansion. The weaker valuation performance for LSAV in reflects its higher London weighting when compared to USAF (85% and 14% by value respectively), where greater increases in property yields have had a more significant negative impact on valuations. The company also revealed that 71% of beds for the 2024/25 academic year have been sold (2023/24: 70%), increasing its confidence that it will deliver rental growth of at least 5% for 2024/25 academic year.
  • Custodian Property Income REIT (CREI) has sold a 16,869 sq ft office in Derby for £2.05m, 36% ahead of the 30 September 2023 valuation.
  • The board of Henderson High Income Trust (HHI) announced that the resolution relating to the issue of shares in connection with the proposed combination with Henderson Diversified Income Trust (HDIV) was approved at the General Meeting of the company held today. The implementation of the proposals remains conditional, among other things, upon the passing of the resolution to be proposed at the second HDIV General Meeting to be held on Tuesday, 16 January 2024. You can read more about the merger here.

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