22nd Nov 2024 09:37
(Alliance News) - Irish Residential Properties REIT PLC on Friday reported third-quarter business momentum as it advanced its strategic review initiatives.
Ireland's largest provider of private rental accommodation said its occupancy rate was 99.4% on September 30, down marginally from 99.6% at June 30.
The real estate investment trust said the high occupancy reflects the high level of demand for rental properties in Dublin and indicates the high-quality of its properties and operating platform.
Shares in the firm were down 8.5% at EUR0.75 on Friday morning in Frankfurt.
Dublin-based Irish Residential said it remains on course to deliver net rental income for the full-year broadly in line with the 76.5% margin reported in its first-half.
Financially, the firm said it has a robust balance sheet, with a loan-to-value ratio of 45.0% as of Thursday. This compares with 45.4% at June 30 and is below the firm's debt covenants and Irish REIT legislation.
This measure compares debt to the fair value of the company's property portfolio.
In August, Irish Residential concluded a 7-month long strategic review, undertaken following a period of challenging conditions in the real estate market.
On Friday, it said it has advanced the initiatives identified in August, completing an exit from the Cork market, an important step in improving cost structures and margins, according to the firm.
Further progress made includes unit disposals expected to bring in between EUR35 million and EUR37 million, with Irish Residential anticipating the disposal of at least 50 units in 2025 at 15%-20% average sales premium.
Cost reduction initiatives also have pressed on, with Irish Residential saying it is in the preliminary stages of implementation, having already executed measures across 4% of the portfolio, which the firm expecting an annualised NRI increase of 8% to 10% for these units.
The firm said it is continuing to manage LTV within its target range of 40% and 45%, with excess capital prioritised for an efficient return to shareholders.
Chief Executive Eddie Byrne said: "We are pleased to report strong progress with our strategic review initiatives and are encouraged by the positive momentum of the business. The execution of our recycling programme is ahead of our expected timeframe and will further strengthen our financial position.
"While we will continue to consider all opportunities to enhance shareholder value, we are confident about the long-term market opportunity which is underpinned by our high-quality portfolio and market leading operating platform."
By Christopher Ward, Alliance News reporter
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