26 January 2022
Real Estate Investors Plc
(“REI” or the “Company” or the “Group”)
TRADING UPDATE AND NOTICE OF RESULTS
Real Estate Investors Plc (AIM:RLE), the
· Completed 15 disposals totalling
· Near normal rent collection levels for 2021of 97.81% (adjusted for monthly/deferred agreements)
· Occupancy levels at 85.75% with near-term potential to rise to 86.73% (based on pipeline lettings and pipeline disposals)
· Improved WAULT to 5.03 years to break and 6.76 years to expiry (FY 2020: 4.84 years / 6.54 years)
· Disposal proceeds used to pay down
· Average cost of debt of 3.5% with 90% of debt fixed as at 1 January 2022
· As at the year-end, hedge facility has improved by
· Dividends paid of 2.25p per share in respect of 2021, with a final dividend to be announced in March, making a minimum annual payment of at least 3p
· Cash at bank of
Paul Bassi, Chief Executive, commented:
“Despite trading in an environment dominated by COVID, our diversified portfolio, which has a healthy exposure to growing market subsectors, has proved to be resilient and portfolio rents are sustainable. The period saw the business take advantage of private investor demand, particularly in the neighbourhood and convenience sector, disposing of 15 assets for a total of
Following a hiatus in office occupier decisions due to government ‘work from home’ advice and the uncertainty around the Omicron variant, there is now a revival of interest in office space, particularly our out-of-town stock and we have a healthy pipeline of new lettings in our void space. We expect this activity, combined with portfolio lease renewals, to translate into enhanced occupancy levels in 2022.
We expect a sharp increase in market activity over the next few months as our region is showcased on the global stage in 2022 during the hosting of the highly anticipated Commonwealth Games. The business is well positioned to benefit from the increased activity and opportunities that this event will generate.”
Strong Disposal Activity
We identified a number of portfolio assets with enhanced break-up value to satisfy strong levels of private investor demand. We completed 15 disposals totalling
High Rent Collection
Robust rent collection levels reported in H1 2021 continued throughout H2 2021 and led to an overall collection for 2021 of 97.81%. This demonstrates the cushioning that the portfolio diversification provides from sector over-exposure which has crippled many businesses. Our strong rent collection levels over the last 12 months, coupled with the fact that we anticipate the end of the government moratorium on unpaid commercial rents in March 2022 (extended in June 2021 for 9 months) makes us confident regarding ongoing rental collection levels.
WAULT and Occupancy
With 256 occupiers across 47 assets, the portfolio has proven itself to be robust with ongoing opportunities being realised via asset management initiatives. Against a challenging backdrop, in 2021, REI completed 54 lease events resulting in an improvement in our WAULT to 5.03 years to break and 6.76 years to expiry (FY 2020: 4.84 years to break/6.54 years to expiry), as at 31 December 2021.
Occupancy at the year end sits at 85.75% (FY 2020: 91.60% / H1 2021: 83.73%) with a potential to rise to 86.73% due to pipeline lettings and pipeline disposals. The occupancy reduction since December 2020 is largely due to disposals and known lease events predominantly across our office sector, however our retail portfolio occupancy is strong at 95.68%. We are in advanced discussions with potential occupiers and remain very optimistic with current market interest that we will recover occupancy in 2022.
Following competitive bidding at West Plaza, the former Premier Inn, Vine Hotels signed up to a 15-year lease over six floors, at a rental level above valuer ERV. This represents almost two thirds of the building and the remainder is fully occupied. Following a refurbishment, the hotel has been opened as a Best Western. New tenants to the portfolio in 2021 also include The Trustees of Association of School and College Leaders; Merkur Slots
Demand for our neighbourhood and convenience assets remains very strong. We are also experiencing high demand for roadside/fast food and drive thru locations and, in response, we have identified suitable unoccupied sites/redundant land and are negotiating competitive terms to strong covenants in this space.
Banking & Capital
Following our announcement in March 2021 regarding a new
We continue to engage with our stakeholders, recognising our duty to them to operate a sustainable business. We are working with market experts and consultants to accurately capture, measure and report ESG data and intend to expand on our ESG reporting in our year-end results.
Notice of Results
The Company announces that it will release its final results for the year ended 31 December 2021 on 22 March 2022.
The information communicated in this announcement contains inside information for the purposes of Article 7 of the
Real Estate Investors Plc
Paul Bassi/Marcus Daly
+44 (0)121 212 3446
Cenkos Securities (Nominated Adviser)
Katy Birkin/Ben Jeynes
+44 (0)20 7397 8900
Jamie Richards/William King
+44 (0)20 3100 2000
Tim Robertson/Fergus Young
+44 (0)20 3151 7008
About Real Estate Investors Plc
Real Estate Investors Plc is a publicly quoted, internally managed property investment company and REIT with a portfolio of 1.5 million sq ft of mixed-use commercial property, managed by a highly-experienced property team with over 100 years of combined experience of operating in the