26th May 2016 09:38
LONDON (Alliance News) - AIM-listed Secure Property Development & Investment Ltd on Thursday said it signed a binding agreement to sell its Linda Residences property portfolio in East Bucharest, Romania for EUR660,000 gross of debt.
In a statement, the property and investment company said the move is in line with its strategy of taking advantage of rising property prices in Bucharest.
The sale of the Linda Residences portfolio generate about EUR450,000 net cash proceeds for the company after repayment of debt. Secure Property also said the move will increase the proportion of its residential properties that generate income, as only about 25% of the portfolio was let to tenants.
The company, which originally had assets only in Ukraine, has been expanding by acquiring assets in high-yield South Eastern European countries, targeting properties let to blue-chip tenants that produce significant cash returns.
Among Secure Property's assets that produce income are logistics terminals in Athens, Bucharest and Kiev, offices in Sofia and Bucharest, a big box retail building in Craiova, Romania, as well as a portfolio of residential units in Bucharest and Sofia which is mostly let.
The aim is to eventually pay an annual cash dividend to its shareholders in the mid-term.
"The Linda sale demonstrates our active management of SPDI's portfolio. This not only involves acquiring prime income producing assets with blue chip tenants in the fast growing South Eastern European region, but also taking advantage of opportunities to secure profitable transactions, and in the process generate cash for reinvestment into our growth plan," Lambros Anagnostopoulos, chief executive officer, said in a statement.
"The high quality and efficient management of the Linda residences attracted the interest of the potential buyer and created the opportunity in an area where such transactions have not been common in the last few years. Additionally we are delighted to be receiving a significant cash injection from what was originally an all-share transaction in 2014," Anagnostopoulos said.
Shares in Secure Property were untraded Thursday, having closed at 13.50 pence Wednesday.
By Samuel Agini; [email protected]; @samuelagini
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