abrdn Property Income Trust Limited Asset Management Update
October 30 2023 - 3:00AM
UK Regulatory
TIDMAPI
abrdn Property Income Trust Limited
(an authorised closed-ended investment company incorporated in Guernsey with
registration number 41352)
LEI Number: 549300HHFBWZRKC7RW84
(The "Company")
30 OCTOBER 2023
ASSET MANAGEMENT UPDATE
Following the positive letting transactions completed during the first half of
the year, abrdn Property Income Trust (API) is pleased to be able to announce
some further asset management activity that has secured over £1.3m p.a. in rent
through new lettings and lease renewals.
In the office sector, the lease over the fourth floor at One Station Square in
Bracknell has now completed, securing a rent of £132,250 p.a. At The Pinnacle
in Reading, our existing tenant Egnyte Limited has upsized on the fifth floor,
taking 4,174 sq.ft at an annual rent of £130,000. This rent is 11% ahead of the
March 2023 valuation. The lease over the first floor at 160 Causewayside,
Edinburgh has been regeared with the removal of the tenant break option. This
has secured £157,000 p.a. of rent for a further 5 years.
At 54 Hagley Road in Birmingham, the previously reported lettings to the Chamber
of Commerce and UK Cab have now completed following the conclusion of the
landlords works. Combined, these reflect a total of 27,770 sq.ft and £538,090
p.a. in rent. The positive momentum at this building has continued with a
letting of part of the 4th floor to Property Investor Network, securing a rent
of £49,830 p.a. Terms have also been agreed on two further lease renewals of
9,365 sq.ft where the tenants are remaining in their existing suites and the
rents are increasing by an average of just over 30% from previous levels.
Refurbishment works at our logistics unit on Rainhill Road in Washington are
progressing well (including the completion of a new 1,150kWp PV scheme on the
roof) and are due to complete in early November. The unit is let under an
agreement for lease and the new 15-year lease will start then. This letting,
along with the others completed since quarter end, will reduce the void rate as
at 30 September from 8% to 4.4%.
This activity demonstrates that API's investment strategy of investing in assets
that tenants want to occupy remains relevant. The API office assets, which
account for just under 18% of the overall portfolio, continue to be attractive
to occupiers with good levels of amenity at attractive rental levels even in a
market with significantly reduced demand and take-up.
In the industrial sector, API is pleased to announce completion of a lease
regear at Monkton Business Park in Hebburn. Hitachi Construction Machinery (UK)
Limited have taken a new 20-year lease at a passing rent of £310,500 p.a., which
is an increase of 19.4% over the previous passing rent. As part of the
transaction, Hitachi are obliged to carry out a package of works that are
anticipated to improve the EPC rating to an "A".
The EPC on API's Bolton industrial unit let to DPD has recently been reassessed
following completion of the letting and the landlord's refurbishment works. API
took the opportunity, at the expiry of the previous lease, to carry out an
extensive package of upgrades to the unit including the extension of the roof
-mounted solar panel installation, an increase in on-site biodiversity and the
inclusion of staff welfare facilities. Following the reassessment, the EPC has
been lodged as an "A" with a score of -54. This negative score reflects the
fact that the unit is operationally carbon negative.
API's speculative 107,000 sq.ft industrial development at Knowsley is
progressing well, with practical completion scheduled for the turn of the year.
The unit will be a best in class building with enhanced ESG credentials, and
this has been reflected in the occupational interest received to date. Whilst
early days, we have received proposals from two parties and are hopeful of
agreeing a letting of the unit ahead of completion.
Mark Blyth, Deputy Fund Manager of API commented: "Despite challenging market
conditions, we continue to have good success letting our void properties as well
as retaining existing occupiers with lease regears. Reducing void property
costs and increasing rental income, whilst at the same time ensuring a strong
focus on ESG, will strengthen API's overall financial standing and position it
well for the future."
All Enquiries:
Jason Baggaley - Real Estate Fund Manager, abrdn
Tel: 07801039463 or jason.baggaley@abrdn.com
Mark Blyth - Real Estate Deputy Fund Manager, abrdn
Tel: 07703695490 or mark.blyth@abrdn.com
END
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