31st Mar 2020 19:02
(Alliance News) - Caledonian Trust PLC on Tuesday reported a slip in assets over the first half and has warned its property portfolio might suffer due to the coronavirus outbreak.
At December 31, the trust's net asset value per share stood at 202.01 pence, down from the 203.70p seen at the end of June.
Caledonian's net assets slipped over the six-month period too, falling to GBP23.8 million from GBP24.0 million.
Chair Douglas Lowe added: "In our existing portfolio, most development properties are valued at cost, usually based on existing use, and when these sites are developed or sold, I expect their considerable upside will be realised. Some investment properties may also have considerable development value, as we expect to realise at St Margaret's."
The property investor said its short-term outlook is "disappointing".
"I believe that the measures to reduce the spread of Covid-19 will inflict an unprecedented shock to the economy, possibly resulting in an unprecedented 20% short term economic contraction," Lowe said.
Caledonian noted income from its investment portfolio may be reduced in the short term if some tenants fail to pay the rent or seek a deferral due to the ongoing uncertainty caused by Covid-19.
"In some instances, to assist them, we may agree to a rent deferral, but, as all our retail tenants should qualify for the available business grants to meet their fixed overheads, the board are of the view that any such deferral should be minimal," Caledonian added.
Shares in Caledonian Trust closed 9.7% lower in London on Tuesday at 140.00 pence each.
By Paul McGowan; [email protected]
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