6th Feb 2014 09:53
LONDON (Alliance News) - Residential property business Grainger PLC Thursday said group sales more than doubled in the four months to January 31, and it plans to take advantage of a much improved UK housing market.
Grainger, which undertakes fund, property and asset management along with residential-led development, said group sales totalled GBP149.3 million during the period, compared with GBP64.4 million a year earlier, due to the one-off disposal of its home reversion portfolio for GBP88 million.
Last month the company completed a deal to sell a portfolio of 1,203 properties across the UK to Clifden Holdings. At the time, Grainger said it will book a pretax profit after costs of GBP9.9 million on the sale.
The firm said "normal" UK sales showed improved margins with 219 units generating gross sales of GBP39.0 million at an average margin of 49.4%. In the corresponding period, the firm had 201 units generating GBP32.4 million at a margin of 41.1%
However, gross rents fell to GBP19.3 million compared with GBP27.3 million in the same period a year earlier, due to the "significant" disposal of properties in 2013, some of which were into co-investment vehicles.
Underlying rents remain strong, Grainger said, with an average rent increase of 5% on the firm's regulated tenancy portfolio in the UK year-on-year. Of which, rent increases on renewals were around 3.4%, and increases on new lets were around 6.7% in the three months to the end of December 2013 for Grainger's managed UK market-rented portfolio.
During the period, Grainger also secured planning permission for two developments projects in west London and one in Hampshire.
We currently see good market dynamics which provide our business with a positive backdrop going forward as we focus for this year on investment and generating new business opportunities," Chief Executive Andrew Cunningham said in a statement.
"We are well positioned to take advantage of the current rising market and have begun to explore future value enhancing investment opportunities in both London and major regional cities. We look forward to an exciting remainder of the year," he added.
The stock was trading at 218.60 pence Thursday morning, up 6.70 pence or 3.2% making it one of the top gainers in the FTSE 250.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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