11th Jun 2025 07:00
Schroder Real Estate Investment Trust Limited
('SREIT' / the 'Company' / 'Group')
RESULTS FOR THE YEAR ENDED 31 MARCH 2025
11% NAV TOTAL RETURN UNDERPINNED BY EARNINGS GROWTH, SECTOR LEADING DEBT PROFILE, ALIGNMENT WITH HIGHER GROWTH SECTORS, AND ACTIVE ASSET MANAGEMENT
Schroder Real Estate Investment Trust Limited, the actively managed REIT focused on improving the sustainability performance of buildings to generate higher income and capital growth, today announces its results for the year ended 31 March 2025. The Company's Annual Report & Consolidated Financial Statements will also shortly be uploaded to the National Storage Mechanism, and will be available on the Company's website, www.srei.co.uk and can be viewed as a PDF at the following link: schro.link/srei2025results.
Low cost, long term debt and active management drives earnings growth, a fully covered dividend, and 11.0% NAV total return
Net asset value ('NAV') increased by 4.8% to £301.4 million, or 61.6 pence per share ('pps') (31 March 2024: £287.4 million, or 58.8 pps)4% increase in dividends paid during the financial year to £17.0 million, or 3.48 pps (31 March 2024: £16.4 million, or 3.34 pps), 100% covered by EPRA earningsNAV total return of 11.0% (31 March 2024: 1.1%), reflecting the Company's strongest annual performance since 2022IFRS profit of £31.1 million (31 March 2024: £3.1 million), reflecting positive portfolio revaluation movementLong debt maturity profile of 8.5 years and a low average interest cost of 3.5%, with 88% either fixed or hedged against movements in interest ratesLoan to value, net of all cash, of 36.9% (31 March 2024: 37.1%), with ongoing non-core disposal programme to reduce to within 25-35% target rangeBest in class governance, with 50% of the Manager's fee linked to market capitalisation (capped at NAV), and the balance linked to NAV, effective 1 October 2025
Sustainability-led active asset management, operational expertise and increased exposure to higher growth sectors delivers strong underlying property performance and continued long term outperformance against the MSCI Benchmark
63% of the portfolio value comprising multi-let industrial estates and retail warehousing, with more than 300 tenants providing a granular and diversified occupier baseAttractive underlying portfolio yield profile, with a net initial yield of 5.6% (MSCI Benchmark: 5.1%) and a reversionary yield of 8.4% (MSCI Benchmark: 6.2%):
o Fixed income uplifts of £4.1 million expected over the next 12 months
ERV growth of 4.2% (MSCI Benchmark: 3.6%)76 new lettings, rent reviews and renewals across 870,000 sq ft completed since 1 April 2024, totaling £8.0 million of annualised rent:
o Rent reviews and renewals agreed 26% and 14% higher than previous levels
Portfolio total return for the financial year of 9.1% (MSCI Benchmark: 6.2%), supported by a high income return of 5.6% (MSCI Benchmark: 4.8%)
Progressing sustainability strategy extracting green premium to help drive earnings growth
Further progress delivering on the Company's sustainability and Net Zero Carbon ('NZC') commitments, with asset management initiatives delivering strong rental growth as the green premium is extracted15 asset-level NZC or sustainability audits completed, identifying asset management opportunities5% annual reduction in both landlord operational energy consumption and associated scope 1 and 2 greenhouse gas emissions on a like-for-like basisMaintained the Company's Global Real Estate Sustainability Benchmark ('GRESB') score of 79 out of 100, achieved against the backdrop of a more demanding, industry wide, assessment approach
Alastair Hughes, Chair of the Board, commented:
"Although investment and occupational market activity has understandably slowed in response to the recent macro-economic and geopolitical headwinds, the yield premium offered by the real estate sector should still nonetheless support a sustainable recovery over 2025 and 2026.
"Our clear and differentiated investment strategy has delivered share price and MSCI Benchmark outperformance, and a good level of income, over the course of the year, as well as four consecutive quarters of portfolio valuation growth, demonstrating the resilience of the underlying portfolio. It is encouraging that, in many cases, this is being driven by refurbishment and redevelopment initiatives to improve asset sustainability performance, which is enabling us to extract the 'green premium' and deliver on our net zero carbon commitments."
Nick Montgomery, Fund Manager, added:
"As the UK real estate market continues its recovery, the portfolio's increasing alignment to higher growth sectors and active strategy has enabled us to deliver an increase in the fully covered dividend and our strongest total return performance since 2022. Our focus over the remainder of 2025 is to maintain the positive momentum of recent months. Continuing to deliver sustainable earnings growth by executing on our sizeable asset management programme and crystalising the portfolio's attractive and peer-leading reversionary potential should support a further rerating of the shares."
A webcast presentation for analysts and investors will be hosted today at 9.00 am BST. To register, please visit:
https://www.schroders.events/SREI25
For further information:
Schroder Real Estate Investment Management Limited Nick Montgomery / Bradley Biggins | 020 7658 6000 |
Schroder Investment Management Limited (Company Secretary) Matthew Riley | 020 7658 6000 |
FTI Consulting Dido Laurimore / Richard Gotla / Oliver Parsons | 020 3727 1000
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