3rd Sep 2025 15:43
(Alliance News) - Alternative Income REIT PLC on Wednesday said it is targeting a lower annual dividend for the current financial year, as it reported the refinancing of debt with a more favourable margin.
The investor in commercial property assets said it has secured new long-term facilities with HSBC UK Bank PLC, consisting of a fixed term loan of GBP31 million and a GBP10 million revolving credit facility.
The new facilities have a fixed term of five years from the drawdown date, said Alternative Income, with the potential for a two-year extension upon mutual agreement.
The real estate investment trust said it has the right, via an accordian mechanism, to request an increase in the RCF size by an additional GBP10 million. It added that the margin on the new facilities of 1.7% over the sterling overnight index average rate marks a "significant reduction" in comparison to its existing debt facilities.
However, the trust did note this is against a higher backdrop of base interest rates. It noted the base rate of 0.25% back in 2017 when it took on its existing facilities.
Alternative Income explained that in the higher interest rate environment, the Bank of England's benchmark rate at 4.00% as of last month, its finance costs are set to rise by 57% to around GBP2.2 million from GBP1.4 million in the prior financial years.
The REIT is therefore targeting a dividend of no less than 5.6 pence per share for the financial year to June 30, down from the 6.2p declared in financial 2025.
Shares in Alternative Income REIT were 1.0% lower at 62.88p on Wednesday afternoon in London.
By Christopher Ward, Alliance News reporter
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