BMO Com Pty Tst Ltd Net Asset Value
29 Octubre 2019 - 1:00AM
UK Regulatory
TIDMBCPT
To: Company Announcements
Date: 29 October 2019
Company: BMO Commercial Property Trust Limited
LEI: 213800A2B1H4ULF3K397
Subject: Net Asset Value
Net Asset Value
The unaudited net asset value ('NAV') per share of the Group as at 30 September
2019 was 133.6 pence. This represents a decrease of 2.0 per cent from the
unaudited NAV per share as at 30 June 2019 of 136.3 pence and a NAV total
return for the quarter of -0.9 per cent.
The NAV has been calculated under International Financial Reporting Standards
('IFRS'). It is based on the external valuation of the Group's direct property
portfolio prepared by CBRE Limited.
The NAV includes all income to 30 September 2019 and is calculated after
deduction of all dividends paid prior to that date. As at 30 September 2019, no
adjustments were required to the NAV in respect of dividends for which the
share price had gone ex-dividend.
Share Price
The share price was 116.60 pence per share at 30 September 2019, which
represented a discount of 12.7 per cent to the NAV per share announced above.
The share price total return for the quarter was 5.7 per cent.
Analysis of Movement in NAV
The following table provides an analysis of the movement in the unaudited NAV
per share for the period from 30 June 2019 to 30 September 2019 (including the
effect of gearing):
% of
Pence per opening NAV
share per share
GBPm
NAV as at 30 June 2019 1,089.8 136.3
Unrealised decrease in valuation of property (20.1) (2.5) (1.9)
portfolio *
Realised gain on sale of property 0.8 0.1 0.1
Movement in fair value of interest rate swap (0.1) 0.0 0.0
Other net revenue 9.9 1.2 0.9
Dividends paid (12.0) (1.5) (1.1)
NAV as at 30 September 2019 1,068.3 133.6 (2.0)
* The ungeared decrease in the valuation of the property portfolio over the
quarter to 30 September 2019 was 1.4%, after allowing for capital expenditure.
The net gearing at 30 September 2019 was 20.7%. #
# Net gearing: (Borrowings - cash) ÷ total assets (less current liabilities and
cash).
Market
The market delivered a 0.6 per cent all-property total return in the quarter
ended September 2019 according to the MSCI UK Monthly Property Index for
standing investments. All-property capital values fell by 0.7 per cent over the
three-month period, with September 2019 representing the ninth consecutive
month of decline.
The retail market continues to be affected by Company Voluntary Arrangements,
administrations and store rationalisation programmes, with the sector
delivering a quarterly total return of -1.5 per cent.
The office market outperformed all-property with mildly positive capital growth
and a 1.4 per cent total return, which was led by London city offices. The
industrial market continued to drive performance with a 1.7 per cent total
return. This was in line with the previous quarter's performance but represents
a deceleration from the pace of the previous few years. Total returns in the
alternatives sectors once again out-performed the all-property average at 1.5
per cent.
The quarter was again notable for the continued weakness in investment
activity. Most parts of the market are now seeing below average levels of
transactions, which has been the case throughout 2019.
Performance is being supported by the income return. This was unchanged in the
quarter at 1.3 percent with income returning 5.3 per cent on an annual basis.
Performance
The property portfolio delivered a total return over the quarter of -0.2 per
cent. The capital value of the portfolio decreased by 1.4 per cent.
The retail assets were worst hit with capital values falling 5.2 per cent in
the retail warehouse sector. Newbury Retail Park and Solihull Retail Park both
experienced valuation falls, wholly attributable to capitalisation rates moving
out, despite the successful lettings contracted over the period.
The value of St Christopher's Place fell 2.4 per cent as a result of the
challenging environment on Oxford Street with estimated rental values falling
and capitalisation rates adjusting outwards.
Investment Activity
There were no purchases during the quarter.
The sale of Phase I of the former Ozalid Works site in Colchester completed to
Persimmon Homes at a gross price of GBP6.2 million, a GBP0.8 million uplift on the
30 June 2019 valuation of GBP5.4 million. The sale of Phase 2 of this site will
complete July 2020.
Lease Activity
Leasing activity of note took place at Newbury Retail Park. There was a letting
of the majority of the former Homebase unit to Lidl at a rent equating to GBP23
psf on a 25-year lease with CPI linked rent reviews (break at year 20). In
addition, there was a letting of part of the former Mothercare unit (6,000 sq.
ft.) to Deichman Shoes at GBP28 psf.
Portfolio Analysis - Sector Breakdown
Portfolio % of portfolio as % like for like
Value at capital value
GBPm 30 September 2019 shift (incl
transactions)
Offices 547.8 40.4 0.2
West End 206.2 15.2 0.6
South East 91.0 6.7 -0.9
South West 33.4 2.5 0.0
Rest of UK 196.5 14.5 0.1
City 20.7 1.5 1.5
Retail 299.5 22.0 -3.1
West End 225.6 16.6 -4.2
South East 42.4 3.1 0.1
Rest of UK 31.5 2.3 -0.6
Industrial 242.8 17.9 -1.6
South East 30.1 2.2 -0.2
Rest of UK 212.7 15.7 -1.8
Retail Warehouse 139.1 10.1 -5.2
Alternatives 130.5 9.6 1.3
Total Property 1,359.7 100.0 -1.4
Portfolio
Portfolio Analysis - Geographic Breakdown
Market % of portfolio as
Value at
GBPm 30 September 2019
West End 491.9 36.2
South East 296.6 21.8
Scotland 174.1 12.8
North West 161.0 11.8
Midlands 156.5 11.5
South West 33.4 2.5
Eastern 25.5 1.9
Rest of London 20.7 1.5
Total Property Portfolio 1,359.7 100.0
Top Ten Investments
Sector
Properties valued in excess of GBP250 million
London W1, St Christopher's Place Estate * Mixed
Properties valued between GBP100 million and GBP150 million
London SW1, Cassini House, St James's Street Office
Properties valued between GBP50 million and GBP70 million
Newbury, Newbury Retail Park Retail Warehouse
Solihull, Sears Retail Park Retail Warehouse
London SW19, Wimbledon Broadway** Mixed
Properties valued between GBP40 million and GBP50 million
Crawley, Leonardo House, Manor Royal Office
Winchester, Burma Road Alternative
Manchester, 82 King St Office
Properties valued between GBP30 million and GBP40 million
Aberdeen, Unit 2 Prime Four Business Park, Kingswells Office
Aberdeen, Unit 1 Prime Four Business Park, Kingswells Office
*Mixed use property of retail, office, food/beverage and residential space.
**Mixed use property of retail, food/beverage and leisure space.
Summary Balance Sheet
GBPm Pence per % of Net
share Assets
Property Portfolio 1,359.7 170.1 127.3
Adjustment for lease incentives (22.0) (2.8) (2.1)
Fair Value of Property Portfolio 1,337.7 167.3 125.2
Trade and other receivables 27.7 3.5 2.6
Cash and cash equivalents 30.5 3.8 2.9
Current Liabilities (17.0) (2.1) (1.6)
Total Assets (less current liabilities) 1,378.9 172.5 129.1
Non-Current liabilities (1.9) (0.2) (0.2)
Interest rate swap (0.4) (0.1) (0.1)
Interest-bearing loans (308.3) (38.6) (28.8)
Net Assets at 30 September 2019 1,068.3 133.6 100.0
Borrowings
The Group's borrowings consist of a GBP260 million loan with a term to 31
December 2024 and a fixed interest rate of 3.32 per cent per annum. The Group
also has a GBP50 million bank loan with a term to 21 June 2021 on which the
interest rate has been fixed, through an interest rate swap of the same
notional value and duration, at 2.522 per cent per annum. There is an
additional revolving credit facility of GBP50 million in place over the same
period, to be used for ongoing working capital purposes and to provide the
Group with the flexibility to acquire further property should the opportunity
arise. This facility is currently undrawn.
The Group's weighted average cost of debt is 3.3 per cent per annum.
Key Information
This statement and further information regarding the Company, including
movements in the share price since the end of the period and the Group's most
recent annual and interim reports, can be found at the Company's website
bmocommercialproperty.com.
The next quarterly valuation of the property portfolio will be conducted by
CBRE Limited during December 2019 and it is expected that the unaudited NAV per
share as at 31 December 2019 will be announced in January 2020.
This announcement contains inside information.
Enquiries:
Richard Kirby
BMO REP Asset Management plc
Tel: 0207 499 2244
Graeme Caton
Winterflood Securities Limited
Tel: 0203 100 0268
END
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