TIDMSHED
RNS Number : 9484D
Urban Logistics REIT PLC
25 October 2022
25 October 2022
Urban Logistics REIT plc
("Urban Logistics" or the "Company")
Trading Update
Strong demand for space drives significant new lettings as
vacancy rate falls
Urban Logistics REIT (LON: SHED), the last mile logistics
focused REIT, announces an update for the period from 1(st) April
2022 to 30(th) September 2022, ahead of the interim results which
will be announced on 11(th) November 2022.
Highlights:
-- 99% of rents due and demanded collected in the period
-- 12 new lettings in the period covering 470,000 sq. ft. of
space, generating GBP4.0m of additional rental income
-- 9 rent reviews or re-gears in the period, generating an additional GBP0.6m of rental income
-- 59% rental uplift across all 21 lease events for the period, on a like-for-like basis
-- 40% of the portfolio with an EPC rating of A or B, and 86%
with an EPC rating A-C, up from 27% A or B and 76% A-C in March
2022
-- Occupancy rate across the portfolio rising to 95% at period
end, with 5 further leases either let post period end or in
solicitors' hands.
-- Recent deployment of a further GBP3.3m of capital, bringing
the total deployed in the period to GBP112m, at a blended NIY of
4.8%
-- GBP122m of debt drawn in the period with Aviva Investors,
fixed for 10 years at a cost of 3.8%, bringing total debt to
GBP310m, of which 97% is hedged or fixed, and has a blended cost of
3.3% and a weighted average term of 6.4 years
-- Built additional flexibility into our debt facilities during
the period, allowing the Company to draw a further GBP51m on demand
at a marginal rate of 3.5%, with a term until 2025
Richard Moffitt, Chief Executive, commented:
"In the first half of the year we have continued to demonstrate
how we can drive value throughout the property cycle, achieving a
59% like-for-like increase in rental rates. Our approach enables
the business to thrive across market cycles due to our core
strategy of acquiring mid-box, single-let logistics properties with
significant asset management potential.
"Lettings have been strong across the portfolio, as we see a
robust occupational market with high demand and low vacancies. In
particular, we're very pleased that our new development at Blenheim
Park has let so quickly, with the final unit expected to be let
shortly, and providing an expected 6.6% yield on cost across the
project. Our new lease at Brent Road, Southall, shows the rapid
implementation of our asset management plans following
acquisition.
"We also have been working hard to demonstrate our commitment to
our ESG agenda and goals, which can be seen at the recently
completed development at Blenheim Park, where all buildings have an
EPC of A and very good BREEAM ratings.
"Looking to the future, we see the potential for continued
capital market turbulence, but are reassured by the continuing
demand in the occupational market for our asset class. We remain
well placed with our largely fixed debt cost, low LTV, and
immediately available debt facilities at an attractive cost, to
acquire assets when the time is right. Our strategy will continue
to be based on value creation through active asset management,
leaving us well-positioned in a volatile market."
Acquisitions:
The Company has recently acquired a 39,899 sq. ft. industrial
warehouse on the Westfield Industrial Estate in Cumbernauld,
Glasgow. The purchase price paid was GBP3,346,362 at a NIY of 7.0%.
The unit is let to Pitreavie Packaging Limited on a lease expiring
in 2032.
In total, the Company completed thirteen acquisitions in the
period, totalling GBP112m at a blended NIY of 4.8%, with GBP296m
deployed across 23 transactions since the December 2021 equity
raise, at a blended NIY of 5.2%.
New lettings
Notable new lettings in the year include:
Brent Road, Southall
A new lease has been granted to Delice de France Ltd for the
97,362 sq. ft. chilled warehouse in west London. The rental income
is GBP1,960,000, a 122% increase on the passing rent at acquisition
in August 2022, and the lease length is 25 years.
Blenheim Park Development, Nottingham
Blenheim Park is a development which was undertaken by the
company in 2021, consisting of 4 units. The development has now
completed, and 3 of the 4 units have been let, with the outstanding
unit expected to be let shortly. All units have an EPC of A.
-- A new lease has been granted to Cotton On Ltd for the 81,301
sq ft unit. The rental income is GBP567,000 and the term is 10
years
-- A new lease has been granted to More Years for the 24,258 sq
ft unit. The rental income is GBP181,051 and the term is 10
years
-- A new lease has been granted to All Shires Foods Ltd for the
18,166 sq ft unit. The rental income is GBP131,152 and the term is
10 years
Exeter Gateway
A new lease has been granted to Forgeway Ltd for the 29,082 sq.
ft. unit developed for the Company at the Exeter Gateway site,
which completed in the period. The rental income is GBP267,279, and
the lease length is 15 years.
Edison Road, Bedford
A new lease has been granted to UK Power Networks Limited on the
24,380 sq ft warehouse near Bedford, following a major
refurbishment. As part of the refurbishment, solar cells were
installed on the roof and electric vehicle charge points were
installed and the EPC was improved from an E to an A. The rental
income is GBP220,158, and the lease length is 10 years.
Interim Results Presentation
Management will be hosting a virtual presentation for research
and sales teams at 9:30am on 11th November 2022. If you would like
to attend the presentation, please contact
urbanlogistics@buchanan.uk.com
- Ends -
Urban Logistics REIT plc
Richard Moffitt +44 (0)20 7591 1600
Buchanan +44 (0)20 7466 5000
Helen Tarbet +44 (0) 7872 604453
Simon Compton +44 (0) 7979 497324
George Beale +44 (0) 7450 295099
---------------------
Singer Capital Markets - Joint Broker
James Maxwell / Alaina Wong / Oliver Platts
(Banking)
Alan Geeves / James Waterlow / Sam Greatrex
(Markets) +44 (0)20 7496 3000
---------------------
Panmure Gordon (UK) Limited - Joint Broker
Chloe Ponsonby, Emma Earl (Investment
Banking) +44 (0)20 7886 2500
---------------------
About Urban Logistics REIT
Urban Logistics REIT plc (LON: SHED) is a FTSE 250 property
investment company. The Company is the only London-listed REIT to
focus on specialist last mile / last touch logistics assets, with a
tenant base which delivers essential goods within the UK. The
Company's strategy is to invest in mid-sized logistics properties
with the objective of generating attractive dividends and capital
returns through active asset management.
Urban Logistics' investment management team, led by Richard
Moffitt and Christopher Turner, has over 50 years' experience in
investing in the logistics market within the broader real estate
market. The team's ability to source vital and strategically
located mid-sized single let properties, with high-quality tenants,
off-market at favourable terms, creates considerable value for
shareholders. Tenants include Amazon, XPO, DHL, Hermes, DPD, Boots,
Unipart (for NHS), Royal Mail and J Sainsbury Plc.
Buying well and pursuing additional value enhancing asset
management initiatives has driven the Company's growth, enabling
Urban Logistics to grow from a GBP10m market cap company at IPO in
April 2016 to own a portfolio of over GBP1bn at 31(st) March
2022.
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