BY JENNIFER HILL, Citywire Investment Trust Insider, 20 June 2024:
Last-mile warehouse investor Urban Logistics (SHED) believes the time is right to increase gearing after what analysts at QuotedData hailed ‘another year of strong operational performance’.
Net rental income rose 8.4% in the year to end-March as the mismatch between supply and demand in logistics assets near major towns and cities continued to push rents higher. A total of 35 lease events at an average 19% like-for-like rental uplift generated an additional £3m in rental income during the year.
Despite rising income, adjusted earnings per share slipped 0.6% to 6.89p due to the higher cost of servicing debt.
The fund’s net asset value (NAV) fell 1.3% over the year and declined 0.9% over the six-month period since 30 September. The value of the portfolio of mid-box urban logistics assets was broadly stable, slipping just 0.3% on a like-for-like basis.
Announcing the results, Richard Moffitt, chief executive of Logistics Asset Management, investment adviser to SHED, pointed to ‘markedly different conditions’ during the two halves of the year.
‘In the first half, uncertainty levels remained high with a lack of clarity on the likely trajectory for both interest rates and inflation. Towards the end of the second half of the year, confidence improved thanks to strengthening macroeconomic conditions,’ he said.
‘Throughout the period, the strength of Urban Logistics’ business model was evident with a stable portfolio valuation, increasing rents and low vacancy levels. The robust performance, both operationally and financially, positions the business well, as we expect investment flow levels into logistics to pick up in the coming 12 months.’
Read more here