TIDMSOHO
RNS Number : 4695J
Triple Point Social Housing REIT
14 April 2020
14 April 2020
Triple Point Social Housing REIT plc
(the "Company" or, together with its subsidiaries, the
"Group")
TRADING UPDATE
-- The Group provides homes for vulnerable individuals of
working age with care needs who have their rent funded through
housing benefit
-- The UK government has, rightly, put supporting vulnerable
people at the top of the political and financial agenda as they
tackle COVID-19
-- 98% of Q1 FY20 rent had been received as at 31 March 2020
(with the remainder expected over the next few days) - in line with
Q1 FY19 receipts, and the Company's general expectations
-- 100% of the Group's leases are linked to annual inflation,
and all of the Group's 171 leases that were due to increase in
April, have increased the rents in line with CPI (using February
2020 CPI Growth - being 1.7 per cent)
-- The Group's financing position remains conservative and
stable, with c.31% LTV of low cost debt
Overview
The Group's investment strategy seeks to offer shareholders
regular dividend income and generate an attractive risk adjusted
total return. The properties owned by the Group provide vulnerable
individuals of working age with care needs, with homes (typically
for the long term) in their community allowing them to live
independently whilst receiving the care and support they need.
These individuals benefit from central government's support through
the recepit of housing benefit.
The Board and the Company's Investment Manager, Triple Point
Investment Manager LLP (the " Manager "), believe that such
investments are well positioned to withstand the current disruption
created by Covid-19 because of their essential and long-term
nature. The Board is reassured that the government has put
supporting vulnerable people at the top of the political and
financial agenda as they tackle the current disruption and impact
on the nation's health.
This central response has been reflected at a community level
and we have seen unprecedented collaboration between registered
providers, care providers and local authorities as they ensure that
the individuals living in the properties owned by the Group
continue to receive care and support with the minimum of
disruption. This has required huge levels of personal commitment
from care workers and housing managers for which the Board is
extremely grateful.
Rental Collection
The Group's rental collection has been normal and continues to
remain robust. As at 31 March 2020 98% of the Q1 FY20 rent had been
received, in-line with the Q1 FY19 collection, with the balance
expected over the next few days, in line with expectations and
previous years.
Inflation-linked Rental Income Increases
100% of the Group's leases have rents that are linked to annual
increases in inflation (98% linked to CPI) and 54% of the Group's
leases have their annual increases applied in April to mirror
increases in housing benefit. As is usual, all of the Group's 171
leases that were due to have rent increases in April have had their
rents increased in line with CPI (using February 2020 CPI growth -
being 1.7 per cent).
Financing
As at 31 March 2020 the Group had undrawn loan facilities and
cash on deposit totalling GBP43.8m after deducting capital
commitments. The Group's net debt was GBP130.7m and on a pro-forma
basis the Loan to Value ("LTV") ratio was 31.1%.
31-Mar-20 31-Dec-19
------------------------------------------- ---------- ----------
Average cost of debt (%) 2.80% 2.77%
Loan to value (%)* 31.1% 31.1%
Interest cover (times)** 4.88 5.16
Weighted average debt to maturity (years) 5.32 5.57
Total debt drawn down (GBPm) 169.09 169.09
Total undrawn facilities and uncommitted
cash (GBPm) 43.84 64.81
Unfettered assets (GBPm)*** 42.57 17.68
------------------------------------------- ---------- ----------
*31 March 2020 LTV % is calculated using NAV as at 31 December
2019.
**31 March 2020 interest cover is based on current Manager
estimates.
***Assets acquired prior to 31 December 2019 are valued as at 31
December 2019. Assets acquired after 31 December 2019 but before 31
March 2020 have been valued at their purchase price. This figure
excludes forward funding deals still under construction, which are
detailed below.
Developments
Three developments with a combined gross development value
("GDV") of GBP7.2m have reached practical completion since the
start of 2020 and we expect a fourth development with a GDV of
GBP3.4m to achieve practical completion imminently, which will
bring the total number of successfully completed forward funding
projects undertaken since the Group's IPO to 15. All of these
schemes were completed within budget.
The Group is currently engaged on a further seven schemes which
have all been developed in response to direct local authority
demand and which all benefit from agreements for lease with
registered providers including Inclusion, Chrysalis and Care
Housing Association. Currently the cost of completed and audited
works on these projects is GBP13.3m and the capital committed to
the completion of these schemes is GBP10.7m.
Through both the Manager's internal surveying team and its use
of external surveyors progress is monitored on all ongoing schemes
and the Manager remains confident that all ongoing schemes will
complete successfully, albeit in some instances over an extended
timeframe reflective of the fact that it is difficult to have full
construction teams on site in the current cirumstances.
Contractually the Group is protected from any cost overruns and so
will not bear the cost of any delays.
FOR FURTHER INFORMATION ON THE COMPANY, PLEASE CONTACT:
Triple Point Investment Management Tel: 020 7201 8989
LLP
(Delegated Investment Manager)
James Cranmer
Ben Beaton
Max Shenkman
Hanway Advisory Limited (Company Tel: 020 7201 8989
Secretary)
Luke Cheshire
Akur Capital (Financial Adviser) Tel: 020 7493 3631
Tom Frost
Anthony Richardson
Siobhan Sergeant
The Company's LEI is 213800BERVBS2HFTBC58.
Further information on the Company can be found on its website
at www.triplepointreit.com .
NOTES:
The Company invests in primarily newly developed social housing
assets in the UK, with a particular focus on supported housing. The
assets within the portfolio are subject to inflation-linked,
long-term (typically from 20 years to 30 years), Fully Repairing
and Insuring ("FRI") leases with Approved Providers (being Housing
Associations, Local Authorities or other regulated organisations in
receipt of direct payment from local government). The portfolio
comprises investments into properties which are already subject to
an FRI lease with an Approved Provider, as well as forward funding
of pre-let developments but does not include any direct development
or speculative development.
There is increasing political pressure and social need to
increase housing supply across the UK which is creating
opportunities for private sector investors to help deliver this
housing. The Group's ability to provide forward funding for new
developments not only enables the Company to secure fit for
purpose, modern assets for its portfolio but also addresses the
chronic undersupply of suitable supported housing properties in the
UK at sustainable rents as well as delivering returns to
investors.
Triple Point Investment Management LLP (part of the Triple Point
Group) is responsible for management of the Group's portfolio (with
such functions having been delegated to it by Langham Hall Fund
Management LLP, the Company's alternative investment fund
manager.
The Company was admitted to trading on the Specialist Fund
Segment of the Main Market of the London Stock Exchange on 8 August
2017 and was admitted to the premium segment of the Official List
of the Financial Conduct Authority and migrated to trading on the
premium segment of the Main Market on 27 March 2018. The Company
operates as a UK Real Estate Investment Trust ("REIT") and is a
constituent of the FTSE EPRA/NAREIT index.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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