22nd Nov 2005 14:54
Insight Foundation Property Tst Ltd22 November 2005 Insight Foundation Property Trust LimitedQuarterly Factsheet - Number Six, November 2005 NAV 108.9 pence (30 September 2005)Total Shares Issued 353,560,000Mid share price 112 pence (30 September 2005)Gross Property Value £439 million (30 September 2005)Number of properties 73Average lot size £6.01 millionAverage lease length 8.3 yearsEx dividend dates 25 January 2006Next financial year end 31 March 2006Current Debt £152.5mArranger NM RothschildGearing 26.7% loan to valueCurrency GBPRegistered Office Guernsey Investment objectiveTo provide investors with an attractive level of income together with potentialfor income and capital growth from investing in UK commercial property. IFPT performance overviewThe Company has been admitted into the FTSE 250 and now has approximately 1,000investors, with over 70% of the shares held by external investors in a 'freefloat'. As at 30 September 2005 and prior to the dividend payment, the NAV ofthe Company increased to 108.9 pence per share. This reflects an uplift of 2.5pence per share, or 2.3% over the last three months. Since the launch of theCompany in July 2004 the Company's NAV has increased by 11.4 pence per share.Over the 12month period to September, combined with the dividend Shareholdershave received a NAV total return of approximately 14.5%. The negative accountingimpact of marking the Company's debt to market has reduced from June to 1.5pence per share. The stated NAV of 108.9 pence per share takes this negativeimpact into account. The September valuation was £439 million, reflecting a2.63% like for like capital uplift over the June valuation. The Company will paya fifth dividend of 1.6875 pence on 2 December. The Company's underlying property portfolio produced an ungeared total return of17% for the 12 months to September, taking account of all transaction costs.Following recent transactions the Company now has property assets totalling£481.645 million. As at 14 November 2005 the Company's share price was 112.75pence, reflecting a premium to NAV of 3.5%. Portfolio ActivitySince the last Factsheet and in accordance with strategy, a London officeproperty has been acquired for £45 million and a retail property has been soldfor a material premium. Significant progress is being made in the pro-activeasset management of the portfolio, particularly in relation to reducing thealready low void rates. Portfolio StructureThe portfolio structure incorporates valuation data as at September 2005, aswell as the recent transactions. Retail 26%Office 50%Industrial 24% The Trust has maintained a balanced and diversified profile with 73 assetsspread across the country in the retail, office and industrial sectors. Recentacquisitions have decreased the weighting of the retail and industrial sectorsin favour of increasing investment into the office sector, particularly incentral London. Central London 24%South East excl. CL 36%Rest of South 9%Midlands and Wales 19%North and Scotland 12% Property market performanceThe third quarter of 2005 witnessed continued strong performance, with the IPDMonthly Index reporting a total return of 4.4%, with a year to date total returnof 12%. Capital growth (over the quarter) of 3% was the same as the quarter to June at3% with industrial property returns reducing. Capital growth continues to bemainly driven by investor demand, with particular pressure in the Central Londonoffice markets. Insight are forecasting total returns for the market for 2005 ofover 15%. Asset management highlights AcquisitionsOn the 7th November the Company completed the acquisition of National MagazineHouse in Soho for £45.05 million. The freehold property benefits from 16,000 sqft floors and is prominently located at the junction of Carnaby Street andBroadwick Street, arguably one of the best office locations in Soho. The property is let for a further 13 years to the strong covenant of TheNational Magazine Company Limited, the UK subsidiary of Hearst Corporation. Theproperty also benefits from leased residential units above the offices. Theprice reflects a net income yield of 5.3% and the offices are let at a low rentof £39.90 per sq ft which is capable of good future growth. There is anopportunity to review the rent upwards in 2008 that we believe is well timed tobenefit from rental growth in the West End and a shortage of good qualitybuildings offering large, clear floors in Soho. We have approximately £70million of equity available for investment and a number of opportunities arebeing considered, with further announcements expected shortly. DisposalsEarly in November, the Company disposed of its retail unit at Thames Street inKingston-upon-Thames for £2.5m. This followed a lease extension being granted toEdinburgh Woollen Mill 23% ahead of the current rent. The net profit relative tothe acquisition price in July 2004 of £1.72 million was over £500,000, after allassociated costs. Active Management The Quadrant, Bradley Stoke, BristolWhen the Company acquired the industrial estate in July 2004 for £8.58 million,it produced an annual rent of £495,000 per annum relative to an estimated rentalvalue of £680,000. The average lease length was 9 years. A pro-active assetmanagement approach has materially improved the estate and planning consent wasobtained for a car hire use at a premium rent. The total annual rent has increased to £550,000 per annum with the average leaselength increasing to over 11 years. Creating the new rental level has increasedthe rental value to £715,000 which has in turn increased capital values to £9.8million; an uplift of 14%. High Street, ScunthorpeThis property was let to WH Smith until 2006, who were not in occupation. A new15 year lease was negotiated with The Works bookshop at an increased rent. Theproperty value increased to £1.16 million as a result reflecting a capitaluplift of 8.4% relative to the purchase price of £1.07 million in July 2004. Largest Ten Holdings Value %*National Magazine House, Carnaby Street £45,200,000 8.1%Minerva House, 5&6, Montague Close, London £43,500,000 7.8%Victory House, Trafalgar Place, Brighton £17,700,000 3.2%Reynard Business Park, Brentford £17,300,000 3.1%20/22, Tudor Street, London £17,100,000 3.1%The Albion Centre, Bath Street, Ilkeston £14,200,000 2.5%Olympic Office Centre, 8 Fulton Road, Wembley £13,650,000 2.4%Union Park, Fifers Lane, Norwich £13,450,000 2.4%The Gate Centre, Syon Gate Way, Brentford £10,800,000 1.9%Mid City Place, High Holborn £10,150,000 1.8% Total £203,050,000 36.3% *Percentage of Gross Asset Value Largest Ten Tenants Rent %National Magazine Company Limited £2,250,000 7.4%Australia & New Zealand Banking Group Ltd £1,460,000 4.8%Mott MacDonald Ltd £1,307,148 4.3%Reed Smith Services £1,295,374 4.3%Freshfields Services Company £1,279,600 4.2%The British Broadcasting Corporation £826,000 2.7%Grand Metropolitan Estates Ltd £795,975 2.6%Recticel SA £713,538 2.4%Jarvis Porter (Property Holdings) Ltd £700,000 2.3%Concept Automotive Services Ltd £515,970 1.8% Total £11,143,605 36.8% Contacts BrokerJP Morgan Cazenove20 MoorgateLondon, EC2R 6DATel: 020 7588 2828Richard Cotton (Managing Director, Corporate Finance)Angus Gordon Lennox (Managing Director, Corporate Finance) Fund AdministrationRBSI Fund Services (Guernsey) LimitedPO Box 482Royal Bank PlaceGlategny EsplanadeSt Peter PortGuernsey GY1 6BHTel: 01481 740 820Paul Smith (Managing Director, RBSI Guernsey) Investment ManagerInsight Investment Management (Global) Limited33 Old Broad StreetLondon, EC2N 1HZTel: 020 7930 5474Duncan Owen (Managing Director, Property) The Company's website is www.ifpt.co.uk Insight Investment Management (Global) Limited. Registered office 33 Old BroadStreet, London EC2N 1HZ.Registered in England and Wales. Registered number 827982. Authorised andregulated by the Financial Services Authority.03383-11-05 Issued in accordance with Section 21 of the Financial Services and Markets Act2000 by Insight Investment Management (Global) Limited. The price of shares andthe income from them may go down as well as up and investors may not get backthe full amount invested on disposal of the shares. Investments in property arerelatively illiquid and more difficult to realise than equities or bonds. Yieldsmay vary, and are not guaranteed. The use of gearing is likely to lead to avolatility in the Net Asset Value (NAV), meaning that a relatively smallmovement either down or up in value of the trust's total assets, will result ina magnified movement in the same direction, of that NAV. There is no guaranteethat the market price of shares in Investment Trusts will fully reflect theirunderlying NAV. This Investment Trust should be considered only as part of abalanced portfolio, of which it should not form a disproportionate part. Underno circumstances should this newsletter be considered as an offer, orsolicitation, to deal in the shares of the company. All figures correct as at30th September 2005. Past performance is not a guide to future performance. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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