30th Nov 2022 13:12
(Alliance News) - Home REIT PLC on Wednesday released its full response to a short-selling report from Viceroy Research, expressing "deep frustration" that it is spending time and resources responding to "baseless and misleading allegations".
The report, published by Delaware-based Viceroy Research on Wednesday last week, included a number of claims against Home REIT which caused its share price to drop around 20% that day.
A week on, the investor in accommodation for homeless people said it is "completely confident in the integrity of the business it is operating, its financial soundness and the beneficial impact the company is having in reducing homelessness in the UK."
Regarding Viceroy's claim that Home REIT's tenants "do not appear to be paying rent", the company said "there are no overdue arrears" relating to amounts billed to August 31.
It attacked Viceroy's assertion that "financial data of Home REIT's tenants show that many cannot afford rent, have not been paying rent, are in administration, are run by bad actors, or simply do not provide social housing services."
In response, Home REIT said "all of the company's tenants provide social housing services" and insisted that there were no overdue payments. It added that any accusation against the conduct of trustees or advisors would be taken seriously, noting it would "investigate any suspected wrongdoing, if required".
Home REIT clarified that Alvarium Home REIT Advisors Ltd, the company's investment advisor, has fee structures that provides incentives to deliver on its targets. Viceroy had claimed the fee structure is "poorly aligned with shareholder interests and perfectly aligned to commit fraud".
Viceroy also alleged that Alvarium "systematically inflated the prices of properties on the balance sheet". Home REIT said revaluation gains were established "by the external valuation process undertaken by Knight Frank as per the RICS Valuation".
In conclusion, Home REIT said it has worked "assiduously" to provide a response that fulfils the market standards of "completeness and transparency". It said the opinions expressed in Viceroy's report were either "not reasonably held" or were "a misinterpretation of matters".
Shares in Home REIT were trading 7.7% lower at 51.50 pence each in London on Wednesday afternoon. The stock is down nearly 40% in November.
By Chris Dorrell; [email protected]
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