18th Oct 2018 13:02
LONDON (Alliance News) - Urban Logistics REIT PLC said it exceeded expectations in a first half that saw its portfolio valuation increase on six new acquisitions.
The real estate investment trust's portfolio valuation had a like-for-like increase of 6.6% in the six months to September. It is now valued at GBP173.8 million. At the end of March, it was valued at GBP131.9 million, giving a total increase including the acquisitions of 32%.
Urban Logistics' portfolio occupancy increased to 98.9% from 93.3% in March, following the lease of two logistics units in the period.
The company let a 108,873 square foot site in Chesterfield to Strata Products at GBP3.97 per square foot for five years.
The company also let a 103,268 square foot site in Leigh, Manchester to OTC Direct at GBP4.94 per square foot for 10 years.
"We have again exceeded expectations through ongoing active asset management in a sector that continues to show strong fundamentals," said Richard Moffitt, chief executive.
"Following the GBP20 million April fundraising, we were fully invested by September, purchasing six well located logistics assets across the Midlands."
Urban Logistics disposed of a site Bedford in the period for a 44% profit on original cost.
"Recent lettings have focused on supporting the distribution operations of high-quality tenants operating in essential goods sectors, underpinning the company's income and total return capabilities.
"Our well-located portfolio continues to offer significant revisionary potential that we intend to capture as part of our ongoing asset management programme."
Urban Logistics warned of a number of near-term risks, including Brexit and retailer company voluntary arrangements and administrations. Despite this, though, the company remains optimistic about its future.
The investment trust said there were record levels of take-up registered in the logistics property sector in the first half of 2018 - more than the whole of 2017 at 17.4 million square feet compared to 17.3 million square feet.
Urban Logistics said "structural changes" in the UK real estate market are accounting for the growth. The main driver continues to be the online retail sector, which accounted for 32% of the logistics property market's overall take-up in the half, leases 5.6 million square feet.
Shares in Urban Logistics were up 1.7% Thursday at 120.03 pence each.
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