Annual results from Schroder European Real Estate highlight the challenges for incoming chair Phil Redding and fund manager Jeff O’Dwyer, Custodian Property Income reports good half-year results and self-storage group Big Yellow confirms takeover talks with Blackstone have ended.

Schroder European Real Estate (SERE), the £83m listed property fund weighed down by a French tax dispute and the likely loss of its biggest tenant, has deferred decisions on its long-term future to give its new chair Phil Redding time to review its situation and speak to shareholders. Redding, former chief executive of Tritax Eurobox and Segro, was appointed last month. He will join the board in January and succeed current chair Sir Julian Berney after the AGM in March. SERE shares stand on a 39% discount and 7.9% yield which reflects the uncertainty over its dividends with KPN, the Dutch telecoms group, having verbally informed the fund of its intention to serve one-year notice on its lease in Apeldoorn this month. With the asset accounting for 6% of the portfolio and 19% of rent, fund manager Jeff O’Dwyer’s top priority is finding a new tenant or selling the property. Meanwhile, the company has formally appealed the French Tax Authority’s demand for around €14.2m in tax, interest and penalties, which it believes is not payable. The claim is likely to take six months and, if dismissed, the company will take the case to a formal court process which could take a further two years. The update came in annual results to 30 September showing net asset value fell 2.9% from 122.7 euro cents to 119.2c. However, the impact of share buybacks meant the total underlying investment return was 2%. This included 5.9c of dividends, maintained from last year, 94% covered by earnings. In June it reported a 2.1% first half fall in NAV to 120.1 euro cents at 31 March.

Custodian Property Income REIT (CREI), the £379m investor in smaller commercial properties outside London, said it was “delivering on all fronts” after half-year results showed a 6% underlying return from improved occupancy, share buybacks and income from recently installed solar panels topping up its rental stream. For the six months to 30 September, EPRA earnings per share grew 3.3% to 3.1p from 3p a year ago to cover 3p of dividends. These support a yield of around 7.4% on shares at 82.4p that stand on a 17% discount to net asset value of 98.9p, up 2.9% over the first half. Fund manager Richard Shepherd-Cross said: “The portfolio has continued to deliver a fully covered [annual] dividend of 6p per share, with future rental growth potential of 13% embedded, and offering a road map to further earnings growth. Simultaneously, undertaking profitable sales ahead of pre-offer valuations has helped to fund various refurbishment initiatives within the existing portfolio, as well as proving valuations.”

Big Yellow Group (BYG) has confirmed that talks with Blackstone over a possible cash offer for the self-storage group have ended. It said Blackstone, which approached the company in October, had provided an update on the level at which the offer could be made. “The board considered this in the context of Big Yellow’s strong performance, strategy and business model. It has concluded that there is no basis for continuing discussions with Blackstone.” The shares fell 6% to £10.06.