6th May 2005 16:55
Insight Foundation Property Tst Ltd06 May 2005 Quarterly Factsheet - Number Four, May 2005 Insight Foundation Property Trust Limited NAV 105.3 pence (31 March 2005)Total Shares Issued 260,000,000Mid share price 115.5 pence (31 March 2005)Gross property Value £379.450 million (31 March 2005)Number of properties 74Average lot size £5.13mAverage lease length 8.4 years Ex dividend dates 27 July 2005 27 October 2005Next financial year end 31 March 2006Current Debt £152.5mGearing 40.2% loan to valueCurrency GBPRegistered Office Guernsey Investment objective To provide investors with an attractive level of income together with potentialfor income and capital growth from investing in UK commercial property. Company Share Overview As at 31 March 2005 the Company's share price was 115.5 pence per share,reflecting an 11.4% premium to net asset value ('NAV'). From inception to 31March 2005, the Company's investors received an annualised total return of 26.9%as compared with the peer group of 25.5%. The Company has declared its thirdquarterly dividend of 1.6875 pence per share which will be paid on 19 May 2005.As at 31 March 2005 and before payment of the dividend, the NAV of the Companyhas increased to 105.3 pence per share, a 1.6% increase over December's NAV of103.65 pence per share and an 8.1% uplift since inception. Clerical Medical With Profits ('CMWP') placed 50 million shares in February.This was 19% of the total share capital and is considered a positive developmentby the Company. It broadens the 'free float' and the diversity of investors aswell as reducing CMWP's shareholding from 61% to 42%. The placement wassignificantly oversubscribed with many new investors from across Europe. Sincethe last Factsheet the Company has also joined the European Public Real EstateAssociation ('EPRA'). Financing In March 2005 the Company successfully closed its £152.5 million securitisation,which refinanced its £98 million interim facility. This is a highly innovativefinancing structure and is a first of its type for the Property Investment Trustsector. Insight worked closely with the debt rating agencies resulting in over90% of the debt being rated AAA with the balance AA. The total aggregate fixedinterest rate is 5.6% compared to the prospectus assumption of 6.3%, providingan estimated additional value of 5 pence per share over the term of the loan. Company Activity There has been considerable property activity over the quarter, both in terms oftransactions and asset management. The Company has acquired property totaling£21.83 million that has subsequently been revalued to £22.40 million, and isunder offer to acquire a further £10 million. The company has also completed onthe disposal of two lower yielding retail properties for £7.15 millionreflecting a premium to the aggregate price paid in July 2004 of £730,000 or11.4%. The impact of these transactions increases the yield on book cost toapproximately 7.1%. Portfolio structure In accordance with the Trust's investment strategy, recent acquisitions haveincreased the proportion of the Trust's assets held in the South East and in theoffice sector. Central London 4%South Eastern 43%Rest of South 11%Midlands and Wales 26%North and Scotland 16% With 74 properties, the Trust remains well diversified with a balanced spread ofretail, office and industrial properties across the UK. Retail 32%Retail Warehouse 2%Office 35%Industrial 31% Property market performance The IPD Monthly UK Commercial Property Index recorded an annual total return of18% up to the 31 March 2005 (source: Investment Property Databank). There-imposition of Stamp Duty Land Tax ('SDLT') across all areas of the commercialproperty market reduced the valuation on many properties in the first quarter of2005. The negative impact on returns for the average IPD portfolio was close to1%. The Company only suffered an impact on returns of about half this figure dueto having less properties in the areas affected. Asset management highlights Disposals The Company sold its retail unit in Chichester for £2.6 million, at a netinitial yield of 3.6%. This price reflected a premium to the purchase price inJuly 2004 of £620,000 or 31%. The Company also sold its retail property in HemelHempstead for £4.55 million, £110,000 above the purchase price. Acquisitions The Company completed the acquisition of a single let office building, VictoryHouse in Brighton. The property comprises 81,361 sq ft and is let to a goodcovenant for a further 4.5 years producing £1.3 million per annum. The purchaseprice of £16.325 million reflects a net initial yield of 7.78% and the propertyoffers considerable scope to add value through asset management. Since thequarter end, the Company has acquired a cash and carry warehouse unit in Acton,West London for £5.5 million. The price reflects an initial yield of 6% with areversion to 8.5% assuming the current rental value is realised in 2007. Active management At the Gate Centre, Brentford the Company now has a detailed planning consentfor a change of use from industrial to car showroom. This initiative willincrease the rent from the subject units by 50% and extends the average lengthof tenants leases from 4 to 11 years. This is a significant value enhancinginitiative and the Company is making two further planning applications forchange of use at two other properties. At the Company's shopping centre in Ilkeston, we have focused on an increasinglyproactive asset management approach. As a result, a new letting approaching 10%ahead of the previous valuation rental level has completed. At Abington Street, Northampton, the Company has documented a rent reviewsettlement at £107,500, 14% ahead of the independent valuation rental valueat purchase last July. Top Ten Properties Value (£ m) % Reynard Business Park, Brentford 17.300 4.56Victory House, Trafalgar Place, Brighton 16.500 4.3520/22,Tudor Street,London,EC4 16.400 4.32The Albion Centre, Ilkeston 13.600 3.58Union Park, Fifers Lane, Norwich 12.510 3.30 Olympic Office Centre, Wembley 12.500 3.29Rectical, Bluebell Close, Alfreton 10.150 2.67Victoria Plaza,Bolton 9.710 2.56The Gate Centre, Brentford 9.450 2.49106 Oxford Road, Uxbridge 9.250 2.44Total gross value 127.370 33.56 Top Ten Tenancies Value (£) % Mott MacDonald Ltd 1,307,148 5.19Freshfields Services Company 1,279,600 5.08Grand Metropolitan Estates Ltd 795,975 3.16The British Broadcasting Corporation 733,500 2.91Jarvis Porter (Property Holdings) Ltd 700,000 2.78Recticel SA 682,201 2.71Concept Automotive Services Ltd 515,970 2.05Tucker, Crossland Darke (Irwin Mitchell) 506,638 2.01Parametric Technology (UK) Ltd 486,200 1.93CRP Print & Packaging Ltd 481,406 1.91 Total income 7,488,638 29.73 Contacts BrokerJPMorgan Cazenove20 MoorgateLondonEC2R 6DATel: 020 7588 2828FAO Richard Cotton(Managing Director, Corporate Finance)Angus Gordon Lennox(Managing Director, Corporate Finance) Fund AdministrationRBSI Fund Services (Guernsey) LimitedSt Andrews HouseLe BordageSt Peter PortGuernseyGY11BRTel: 01481 740 820FAO Paul Smith(Managing Director, RBSI Guernsey) Investment ManagerInsight Investment Management (Global) Limited33 Old Broad StreetLondonEC2N 1HZTel: 020 7930 5474FAO Duncan Owen(Managing Director, Property) 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 tovolatility 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 at 31 March 2005. Past performance is not a guide to thefuture. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Schroder Real