DRUM Income Plus REIT targets 6.3% yield for 2018 – Drum Income Plus REIT says that, for the 12 month period to 30 September 2017, its NAV increased by 0.5% to 94p. When the dividends paid during the period are taken into account the NAV total return for the twelve months to 30 September 2017 is 6.3%. The premium has contracted to 0.5%. The company has paid four quarterly dividends each of 1.375 pence per share, making total dividends in respect of the year to 30 September 2017 of 5.50 pence per share, an increase of 4.8% on the dividends paid in respect of the previous year. The dividends were fully covered by revenue earnings per share of 6.65 pence for the year. In the absence of unforeseen circumstances the board continues to expect to pay dividends totalling at least 6.0 pence per share in respect of the year ending 30 September 2018, equivalent to a yield of 6.3% at the current share price.
A property revaluation uplift of £1.4m was offset by acquisition costs of £526,000 in relation to Kew retail park plus additional operational and asset management expenditure.
During the year one further property was acquired taking the total number of property assets in the portfolio to 10.
They say that highlights across the portfolio during the year would be:-
Securing a new lease to Micron at Lakeside in Cheadle at a rent ahead of business plan, which has also resulted in a positive rent review outcome with Agilent post the year end.
At Arthur House they have successfully refurbished the common parts and agreed a new 5 year lease at a headline rent of GBP18.50 per square foot for part of the building, the previous passing rent was GBP13.50 per square foot. This has had a positive impact on the rental tone, lease length and covenant strength of the asset.
LS Buchanan have exercised an option to extend the lease at Monteith House in Glasgow where ERV’s have risen due to the scarcity of well-located small floor plates.
3 Lochside Way, Edinburgh was acquired in July 2016 with 3 floors vacant. Prior to the year-end occupiers were secured for 2 floors and following the year end the final suite has been let. The rental tone achieved has been in excess of the business plan which has had a positive impact on value.
Gosforth Shopping Centre continues to be a strong performing asset and over the last period they have completed the construction of 3 kiosks at a cost of c GBP40,000 and have now let all 3 at an annual rent of circa GBP21,000 per annum.
Duloch Park Dunfermline continues to perform well where they are unlocking value by progressing rent reviews across the park.
DRIP : DRUM Income Plus REIT targets 6.3% yield for 2018