TIDMBCPT 
 
To                    RNS 
Date                12 April 2021 
From                BMO Commercial Property Trust Limited (the "Company") 
L.E.I.                213800A2B1H4ULF3K397 
 
Results in Respect of the Year Ended 31 December 2020 (audited) 
 
 
Headlines 
 
  * Rental collection currently received to date since the first Covid lockdown 
    restrictions, from March 2020 to December 2020 is 88.2 per cent. 
  * The Company produced a portfolio total return of -4.8* per cent versus the 
    MSCI UK Quarterly Property Index ('MSCI') return of -2.0 per cent. 
  * Net asset value total return of -8.1 per cent 
  * Share price total return of -28.3* per cent 
  * Dividends for the year amounting to 2.85 pence per share 
  * Dividend cover of 162.8 per cent* 
  * Yield on year-end share price of 3.6 per cent*. 
  * Void rate reduced from 4.8 per cent to 2.9 per cent at year end. 
  * Completed the development at Newbury for new Lidl foodstore. 
  * Completed the development at Solihull for new M&S general merchandise 
    store. 
  * Several significant industrial lease renewals completed. 
  * ESG progress: Improved GRESB score and Gold award from EPRA sustainability 
    BPR. 
 
*see Alternative Performance Measures 
 
 
Chairman's Statement 
 
The last year has been exceptionally challenging and, as you will have seen 
from the headlines, the results we are reporting for the year are 
disappointing. The Covid-19 pandemic ("the pandemic") is, of course, upper most 
in our mind as we think about the past year and the widespread suffering and 
sad loss of human life. The Company's 2020 results should be viewed against the 
backdrop of the pandemic. 
 
For our part, we have done all we can to ensure the safety of our Managers' 
staff and our tenants and their visitors. We have developed and implemented new 
protocols throughout the business, and across the portfolio, to ensure 
compliance with Government guidelines. We have been sympathetic to the 
difficulties faced by many of our tenants, carefully considering their 
differing circumstances, aligning interests by offering rent concessions where 
appropriate to support the short-term needs of their businesses as they re-map 
post-Covid plans for recovery and growth. 
 
Notwithstanding the 2020 headline results, much positive progress has been made 
this year with the completion of many new lettings and lease renegotiations as 
well as asset management and ESG initiatives. Welcoming many new tenants to our 
portfolio during such a difficult year is testament to its underlying quality. 
At the end of the year, our void level stands at an historically low 2.9 per 
cent and we firmly believe that our portfolio, underpinned by our strong core 
assets, is well positioned for recovery. 
 
Property Market 
In what was the most demanding year in recent memory, the UK direct commercial 
property market delivered a -2.0 per cent all-property total return. The 
disruption caused by the pandemic, coupled with persisting concerns on what a 
post-Brexit trading environment would mean for the UK, were the two significant 
factors weighing heavily on the property market. 
 
At a sector level, industrial and distribution units proved resilient, 
delivering positive total returns in the year, buoyed by the shift to online 
sales. Other sectors fared less well, in particular the structural problems 
affecting the retail sector were exacerbated by pandemic related restrictions 
that ultimately led to suspensions in trading and store closures. Sadly, some 
businesses have been critically damaged and will never return to our high 
streets and retail parks. The office sector was also negatively impacted, 
clouded by concerns about tenants reducing their future space requirements as a 
consequence of a permanent shift, or more flexible approach, to remote working. 
 
The market steadied as the year progressed, delivering a modest positive total 
return in the second half, although capital values and open market rental 
growth remained negative throughout. All property returns were supported by a 
4.5 per cent annual income return. Investment volumes showed some signs of 
recovery later in the year with activity focused on Central London offices and 
the industrial sector, while the retail and leisure sectors remained firmly out 
of favour with little to no transactions evident. 
 
Performance for the Year 
 
Our relatively higher weighting to the out of favour retail and office sectors, 
particularly our exposure to London's West End through St Christopher's Place, 
combined with a lower exposure to the strongly performing logistics sector, has 
amplified our relative underperformance in these challenging markets. 
 
Our share price at the end of the year was 80.0p, representing a discount of 
31.9 per cent to the year-end Net Asset Value (NAV) per share of 117.5p 
(compared to an 11.7 per cent discount as at 31 December 2019). 
 
The persistency of the discount is a primary concern of the Board and is 
reviewed at each Board Meeting. The option of share buybacks was regularly 
considered but, in the face of such heightened uncertainty, the immediate 
preference was to strengthen cash resources and invest in accretive asset 
management initiatives. 
 
While the NAV total return for the year was -8.1 per cent, the widening in the 
discount during the year, resulted in a disappointing share price total return 
of -28.3 per cent. The total return for the portfolio was -4.8 per cent, 
lagging the total return of -2.0 per cent from the MSCI UK Property Index 
(MSCI) and our capital return was -9.0 per cent, compared with -6.2 per cent 
for the Index. 
 
It has been a period of significant valuation movement as investment and 
occupier markets re-set in response to changing structural trends. From today's 
adjusted levels, the Board has confidence that the high quality, core assets 
owned by the Company are positioned to benefit as business and consumer 
sentiment improves and the UK returns to a more normal trading environment. 
 
The following table provides an analysis of the movement in the NAV per share 
for the year: 
 
                                                             Pence 
 
NAV per share as at 31 December 2019                         130.9 
 
Unrealised decrease in valuation of property portfolio      (15.2) 
 
Net revenue                                                    4.6 
 
Dividends paid                                               (2.8) 
 
NAV per share as at 31 December 2020                         117.5 
 
The largest detractor to performance were our retail assets, returning -14.0 
per cent for the year with large capital falls at the St Christopher's Place 
Estate and Broadway, Wimbledon. 
 
The St Christopher's Place Estate, our largest investment, fell overall by -17 
per cent in the year with its two Oxford Street retail units being particularly 
hard hit (-33 per cent) as yields moved out and rental values were 
significantly downgraded. We remain optimistic about the prospects for this 
Estate and are looking forward to entering a more positive next chapter, 
encouraged by the number of new retail and restaurant businesses that have 
committed to new leases during 2020. This is a great vote of confidence in the 
Estate. Elsewhere, working with local stakeholders, the exciting repositioning 
of James Street continues and a number of other plans to deliver further value 
across the Estate are mentioned in the Manager's Report. 
 
In addition to St Christopher's Place, another large valuation fall was seen at 
Broadway, Wimbledon, where a combination of yield movement, rental concessions 
and rental value downgrades for the dominant restaurant, gym and cinema uses, 
resulted in a reduction of 24 per cent. In the current environment, it's 
unsurprising that no credit can be taken for the medium-term development 
potential of this significant asset, but the Manager will continue to explore 
these interesting future options in the months ahead. 
 
Mirroring the positive leasing activity at St Christopher's Place, there was 
also good progress on a number of fronts at the Company's two retail parks. Of 
particular note were the major capital projects undertaken in the year. Newbury 
saw the construction of a new 19,500 sq.ft. Lidl foodstore that opened to the 
public in October 2020 and at Solihull, Marks and Spencer entered into a new 20 
year lease for a redeveloped 35,000 sq.ft. store that we have combined with the 
adjacent M&S Food Hall. Both will bring increased footfall to the Parks. This 
activity combined with other initiatives already underway to introduce more new 
tenants on to the Parks will provide good prospects for positive future 
performance at a time when investor interest is beginning to return to this 
sector of the property market. 
 
Moving away from retail, our office portfolio experienced an overall return for 
the year of -1.0 per cent with this headline number masking some large 
increases and falls. The Leonardo Building, Crawley, fell by -22 per cent as a 
result of a lease renegotiation with the tenant, Virgin Atlantic, as part of 
their financial restructuring in response to the pandemic's huge impact on 
airline businesses.  3 The Square, Stockley Park, fell by -19 per cent due to 
the reducing unexpired lease term which led to a valuation re-rating in 
response to the 'risk off' attitude of investors that was prevalent during 
2020. 
 
These downward movements were counterbalanced by increases elsewhere. Cassini 
House, London SW1, now fully occupied following the letting to Mitsui Fudosan 
in February 2020, enjoyed a valuation uplift of 4.5 per cent over the year. 
Strong progress has also been made at Watchmoor Park in Camberley with an 
increase of 10 per cent. Here, a new lease for 5 years with Muller was 
completed on the refurbished second floor and, since the end of the year, terms 
have been agreed to lease all the remaining vacant space. 
 
Our well-located industrial portfolio returned 7.2 per cent over the year. 
Performance was constrained by some significant lease events on the horizon in 
2021 so it's pleasing to note that we were able to advance two of these towards 
the end of the year. At G Park in Liverpool, a new 10-year renewal from March 
2021 has been agreed with DHL and, more recently, terms have been settled with 
Kimberley Clark to renew the lease of their distribution warehouse in Chorley. 
Valuations are beginning to respond to the increasing WAULT across this part of 
the portfolio with more still to come. 
 
Borrowings and Loan Refinancing 
The Group's borrowings comprise a £260 million term loan with Legal & General 
Pensions Limited, maturing on 31 December 2024. The Company also has a Barclays 
£50 million term loan and an undrawn £50 million revolving credit facility 
which is available to the Company on the satisfaction of certain conditions 
prior to drawdown. The Barclays facility expires on 31 July 2022, with the 
option of two further one-year extensions. As at 31 December 2020, the 
Company's net loan to value ('LTV') was 22.6 per cent. 
 
Dividends 
The Company paid seven interim dividends totalling 2.85 pence per share during 
the year, compared to an annual dividend in 2019 of 6.0 pence per share. In 
April 2020, due to the uncertainty that the impact of the pandemic would have 
on future rental receipts, the Board took the difficult decision to temporarily 
suspend monthly dividend payments in order to strengthen cash reserves and 
protect the long-term value of the Company for the benefit of all shareholders. 
Aided by a proactive approach from the Manager, many early agreements were 
reached to restructure leases or temporarily defer rents, and this supported 
the reintroduction of monthly dividends at 0.25 pence per share from August 
2020. Collection rates continued at levels ahead of those anticipated in April, 
giving the Board confidence to increase the dividend further to 0.35 pence per 
share in December 2020. 
 
Whilst there is now greater clarity on the timing of restrictions being lifted 
as the roll out of the vaccine continues apace, the path of economic recovery 
remains far from certain. That said, the Board's expectation is to continue to 
pay monthly dividends at the current level for the foreseeable future. We are 
mindful of the requirement to comply with the REIT test of distributing 90 per 
cent of all net rental receipts and will continue to closely monitor the level 
of future rental receipts and earnings. 
 
Rent Collection 
As highlighted in the Company's quarterly trading updates, collection of rent 
in the retail and leisure sectors of the portfolio has been challenging. This 
is unsurprising given the Government restrictions that have been in place, with 
the non-essential retail and restaurants at St Christopher's Place and the 
cinema and gym at Wimbledon having had limited trading opportunity since March 
2020. 
 
Rental collection for the year as a whole was 91.0 per cent, with collection 
for the nine-month period following the first lockdown standing at 88.2 per 
cent. The breakdown of our rental collection for the nine-month period by 
sector is detailed below: 
 
                                                     Rent  Collected         (%) 
                                                billed (£       (£m) 
                                                       m) 
 
Industrial                                            9.9        9.9        99.4 
 
Offices                                              20.8       20.0        96.2 
 
Retail Warehouse                                      5.9        5.1        86.2 
 
Retail                                                9.2        5.9        64.2 
 
Alternatives                                          3.3        2.5        74.7 
 
Total                                                49.1       43.4        88.2 
 
Rent collection rates for the first quarter of 2021, a period during which the 
country has been on full lockdown, is at 84.7 per cent. 
 
The Managers' continue to engage with tenants to deliver constructive outcomes 
and provide support where it is deemed appropriate. 
 
Environmental, Social and Governance (ESG) 
Whilst the Company's focus on the social element of ESG was strong during the 
year, this was not at the expense of environmental aspirations. With the global 
spotlight on climate change focusing on Glasgow and its hosting of the 26th UN 
Climate Conference, there is heightened awareness of the need to position the 
portfolio, so it remains resilient as we transition to the green economy. The 
Company has been actively progressing its approach to environmental risk and 
opportunity throughout the year and has been working hard in preparation for 
setting and publishing its net zero carbon ambition in 2021. 
 
ESG remains a core aspect of the Company's forward strategy and at the heart of 
the Manager's investment process and I am pleased to report that the Company 
was the highest rated ESG Company in its peer group by GRESB in 2020. We will 
continue our focus on our environmental and social impacts which remains 
resolute and we are dedicated to building on this leading position. The Board 
remains fully committed to this agenda and is pleased to provide a summary of 
progress in the Annual Report, whilst a deeper review will be shared in the 
2020 ESG Report, available on the Company's website. 
 
Board Composition 
I will retire at the AGM in June, having served on the Board for ten years, the 
last two as Chairman. The strong results delivered to investors in earlier 
years have sadly been overshadowed by a period of recent underperformance. It 
has been a demanding yet rewarding experience throughout. I have been 
privileged to work alongside a great cadre of directors, past and present, and 
truly believe that the nature of the high-quality portfolio means the Company 
is well positioned to drive forward strongly from today. 
 
With effect from the date of my retirement, Paul Marcuse will take on the role 
of Chairman. Paul, who has 40 years' experience in the real estate and finance 
sectors has been on the Board since January 2017 and I feel confident that I 
leave the Company and the Chairmanship in good hands. 
 
I would also like to welcome Hugh Scott-Barrett who joined the Board on 4 
January 2021. Hugh brings valuable experience having worked at Board level for 
over twenty years across real estate, asset management, and banking. In 
particular, he was Non-Executive Chairman at Capital & Regional plc until May 
2020 and was Chief Executive of the Company prior to this from 2008 to 2017. 
Hugh will take on the role of Senior Independent Director from the AGM date. 
 
Annual General Meeting 
Despite significant progress with the UK's vaccination programme, there remains 
much uncertainty around the easing of the latest lockdown and the continuation 
of social distancing in the months ahead. The Company's articles do not allow 
the AGM to be held online and there will therefore be an online shareholder 
meeting on 3 June 2021 at which there will be a presentation by the Manager, 
which will be followed by a question and answer session with the Board and the 
Manager. 
 
Until new articles are adopted, the online shareholder meeting needs to be 
separate from the formal AGM which will be held two weeks later on 17 June 
2021. The AGM will be purely functional in format with access limited to two 
members only, this being the minimum number sufficient to form a quorum. Voting 
at the AGM will be conducted by way of a poll and we therefore urge 
shareholders to lodge their votes to arrive by the deadline stated in the 
notice of meeting, appointing the chairman of the meeting as proxy. A 
resolution to adopt new articles of incorporation that will provide the Board 
with the flexibility to hold physical, virtual only and/or hybrid meetings, 
will be put to shareholders at the forthcoming AGM. 
 
Future Positioning 
Notwithstanding the exceptional headwinds of 2020, we have strong conviction in 
the prospects for the portfolio. Our year-end void rates are low and our 
Manager is focused on growing income and driving value as a result of numerous 
asset management initiatives across the portfolio. 
 
Following a thorough review of strategy during 2020 a higher level of 
transacting can be anticipated in the coming year as we move to recycle capital 
and adjust sector weightings. Particular priority will be given to using sales 
proceeds to buy-back the Company's shares if the high level of discount 
persists and if the Board believes that this course of action is in the best 
interests of all shareholders. The Board and Managers' look forward to sharing 
our progress and to actively engaging with shareholders in the coming year. 
 
Martin Moore 
Chairman 
 
 
 
 
Managers' Review 
 
 
Property Market Review 
The benchmark total return for the year, as measured by the MSCI UK Quarterly 
Property Index ('MSCI') was -2.0 per cent. Total returns were substantially 
lower than in 2019, primarily impacted by the disruption and uncertainty caused 
by the pandemic, but also the Brexit uncertainty that persisted for a large 
part of the year and structural problems in the retail sector. 
 
Key Benchmark Metrics - All Property 
 
                                                           2020           2019 
                                                              %              % 
 
Total Returns                                             (2.0)            1.3 
 
Income Return                                               4.5            4.5 
 
Capital Return                                            (6.2)          (3.1) 
 
Open Market Rental Value Growth                           (3.1)          (0.7) 
 
Initial Yield                                               4.7            4.7 
 
Equivalent Yield                                            5.8            5.5 
 
Source: MSCI Inc 
 
Despite a recovery towards year-end, investment activity in 2020 was lower than 
in the previous year, with most sectors of the commercial real estate market 
affected. However, industrial assets, helped by a number of large portfolio 
deals and strong demand from a wide range of investors, did record a marked 
annual increase in investment volumes. Net investment from overseas buyers 
remained positive, but institutions were net sellers of property, along with 
both listed and private property companies. The year saw investors favouring 
assets with long-term secure income and if possible, underpinned by alternative 
use value. 
 
Capital values fell by 6.2 per cent at the all-property level. The market was 
supported by a 4.5 per cent annual income return. 
 
The market was characterised by a polarisation in sector performance. Retail 
remained the weakest of the three main sectors, with a -12.3 per cent total 
return. Shopping centres were the worst affected segment, but the pandemic, 
lockdowns and subsequent loss of footfall from tourists and workers led to a 
marked deterioration in retail total returns in the big cities, and Central 
London retail in particular. Company Voluntary Arrangements (CVAs), 
administrations and store closures continued, with a focus on department stores 
and fashion but also spreading to food and beverage. The pandemic hit leisure 
and hospitality hard and contributed to a -2.0 per cent annual total return for 
the alternatives sector, outweighing a positive contribution from residential 
property and healthcare. 
 
Offices delivered a mixed performance, helped by low levels of new supply but 
there were concerns about the impact of working from home and social distancing 
in workplaces, which affected sentiment. The sector delivered a -1.4 per cent 
total return for the year, with modest positive total returns in the City and 
Rest of UK office markets being outweighed by negative total returns in the 
West End and Rest of South East. Both occupiers and investors were hesitant to 
commit in uncertain times and there appears to be a flight to quality in the 
sector. 
 
Industrials and logistics pulled ahead of the field in 2020 to deliver a total 
return of 9.4 per cent. The South East, including London, was once again ahead 
of the regions. Distribution out-performed standard industrials, for the first 
time since 2013. All segments of the industrial and logistics market 
experienced stronger performance. The accelerated shift to online retailing and 
the need for storage space during lockdown boosted take-up to record levels 
during the year. 
 
The pandemic inevitably depressed GDP, with the first estimate pointing to a 
9.9 per cent drop in 2020. With many businesses closed and supplies disrupted, 
companies have often struggled to raise revenue and pay rent. Rent collection 
rates have been impacted across the market with offices and industrials 
relatively resilient but retail and leisure seeing a sharp fall. The government 
imposed a moratorium on landlord's actions to enforce payment of rent which has 
been extended to at least June 2021. MSCI data shows a 4.2 per cent fall in net 
operating income growth in 2020, with a positive performance from offices and 
industrials being outweighed by falls in retail and alternatives. 
 
Against a weak economic backdrop, open market value rental growth at the 
all-property level was -3.1 per cent in 2020, the lowest since the global 
financial crisis and this reflects long-term structural issues in retail as 
well as the effects of the pandemic. 
 
MSCI data for standing investments showed modest yield compression during the 
year at the all-property level despite the economic headwinds. Inward yield 
movement for industrials and residential contrasted with an outward shift for 
retail and hotels and broad stability for offices. 
 
Valuation and Portfolio 
 
The total return from the portfolio in the year was -4.8 per cent compared with 
the MSCI return of -2.0 per cent. The Company's performance has been affected 
by valuation falls, primarily on the retail holdings most impacted by Covid and 
the lockdowns. Broadway, Wimbledon with its exposure to leisure, non-essential 
retail and hospitality saw its valuation fall by 24.2 per cent as 
capitalisation rates moved out, rents rebased and the valuation reflected the 
concessions provided to tenants. St Christopher's Place Estate, our largest 
holding fell by 17.0 per cent. Valuers also adopted a blanket assumption on all 
retail, restaurant and leisure properties of allowing for 3-6 month's rent as a 
capital deduction. Elsewhere the valuers moved out capitalisation rates on all 
properties with short unexpired lease terms and those impacted by Covid. For 
instance, the valuation of The Leonardo Building, Crawley fell by 22.0 per cent 
due to the tenant Virgin Atlantic negotiating a rent concession as detailed 
below and 3 The Square, Stockley Park by 19.0 per cent due to a short unexpired 
lease term. 
 
Sector Analysis (% of total property portfolio) 
 
                                                        2020              2019 
                                                         (%)               (%) 
 
Offices                                                 42.2              40.9 
 
Retail                                                  18.5              21.8 
 
Retail Warehouses                                       10.0              10.0 
 
Industrial                                              19.1              17.5 
 
Alternative                                             10.2               9.8 
 
Source: BMO REP Asset Management plc 
 
Geographical Analysis (% of total property portfolio) 
 
                                                        2020              2019 
                                                         (%)               (%) 
 
South East                                              20.3              21.6 
 
London - West End                                       35.4              36.5 
 
Eastern                                                  1.7               1.9 
 
Midlands                                                12.4              11.1 
 
Scotland                                                13.3              13.0 
 
North West                                              12.7              11.9 
 
Rest of London                                           1.6               1.5 
 
South West                                               2.6               2.5 
 
Source: BMO REP Asset Management plc 
 
Lease Expiry Profile 
 
At 31 December 2020 the weighted average lease length for the portfolio, 
assuming all break options are exercised, was 6.0 years (2019: 6.6 years) 
 
% of leases expiring (weighted by rental                2020              2019 
value)                                                   (%)               (%) 
 
0 - 5 years                                             47.5              45.1 
 
5 - 10 years                                            34.1              34.9 
 
10 - 15 years                                           12.0              12.6 
 
15 - 25 years                                            6.4               7.4 
 
Source: BMO REP Asset Management plc 
 
The largest occupiers, based as a percentage of contracted rent, as at 31 
December 2020, are summarised as follows: 
 
Income Concentration 
 
Company name                              % of Total Income 
 
Artemis Investment Management LLP                       4.3 
 
Apache North Sea Limited                                4.0 
 
GB Gas Holdings Limited                                 4.0 
 
CNOOC Petroleum Europe Limited                          4.0 
 
Kimberly-Clark Limited                                  3.8 
 
Virgin Atlantic Limited                                 3.0 
 
JP Morgan Chase Bank                                    3.0 
 
University of Winchester                                2.9 
 
Transocean Drilling UK Limited                          2.8 
 
Mothercare UK Limited*                                  2.6 
 
Total                                                  34.4 
 
Source: BMO REP Asset Management plc 
 
*has a rental guarantee from a Mothercare company not in administration. The 
lease was assigned to Ceva Logistics in March 2021. 
 
Income analysis 
We started the year with a vacancy rate of 4.8 per cent and due to the leasing 
activity detailed in this report we were able to reduce this over the year to 
2.9 per cent, excluding property being developed or refurbished. Whilst this 
rate is extremely low, there is an expectation it will increase as the full 
economic impact of Covid-19 takes effect. 
 
As Managers, we have been focussed on rent collection with rental collection 
statistics fast becoming the main metric of the Company's performance. BMO REP 
has an in-house team which provides a full service across rent demand, credit 
control, service charge administration and purchase ledger. The asset managers, 
supported by this team, have been proactively engaged with many of the 
Company's tenants, assessing and responding to requests for support on a case 
by case basis. There is 'no one size fits all solution'. It is apparent that 
these strong and historic relationships, combined with robust controls and 
processes, have supported rent collection during such challenging times. The 
Government has provided commercial tenants with well-publicised protection from 
landlords seeking to take legal action to recover arrears of rent. It has 
recently been announced that this protection has been extended until 30 June 
2021. Unfortunately, there are a small number of tenants with strong businesses 
who are using this protection not to pay rent or to engage. 
 
At 31 December 2020 the weighted average lease length for the portfolio, 
assuming all break options are exercised, was 6.0 years (2019: 6.6 years). 
 
Retail 
The enforced closure of all non-essential retail has increased the stress on 
many retailers and has led to a torrid period of increased administrations, 
CVA's and high-profile failures. At our retail parks the 'essential retailers' 
such as Asda, Lidl, M&S Foodhall, Boots and B&Q have remained open and managed 
to accommodate customers into their stores by adopting Covid safe practice. 
Although restricted to selling essential goods with limited customer numbers in 
store their annual figures, in the main, demonstrate reasonable trade 
throughout the pandemic. Most non-essential retailers saw a welcome boost in 
sales following the end of the first lock-down in June 2020. The car parks at 
Solihull and Newbury were busy and consistently operating at approximately 80 
per cent capacity, with figures even higher in December. Hoping that the second 
lock down in November 2020 would be short-lived was perhaps wishful thinking. 
Many soon found themselves in Tier 4 and any pre-Christmas recovery was short 
lived before entering the latest lockdown. 
 
Although revenues are down significantly, in some cases non-essential retailers 
have managed to prop up sales through increased online orders and click and 
collect facilities from "shuttered" stores. This was very evident at Newbury 
Retail Park, by the likes of Mountain Warehouse, Hobbycraft and Currys PC 
World. Despite these initiatives, in some cases stock supply and logistics 
issues have hampered sales. However, where our tenants have both retail park 
and town centre stores, they were anecdotally reporting stronger performance 
from their retail parks as shoppers favoured an outdoor environment, convenient 
car parking and larger store formats where it is easier to maintain social 
distancing. 
 
The welcome news that non-essential retail will be able to re-open on 12 April 
could not come soon enough. The general consensus appears to be that there will 
be a repeat of the trading experienced following the lifting of the first 
lockdown in June 2020 and hopefully even greater propensity for frustrated 
customers to spend, knowing that the vaccination programme is progressing well 
and there is light at the end of the tunnel. Newbury and Solihull are quality 
assets with strong catchment areas that have benefitted from a number of 
substantial developments and new store openings which should help drive future 
footfall. 
 
We are able to report the following progress: 
 
Newbury (retail warehouse) 
The construction works at Newbury continued throughout lockdown 1.0. and all 
units completed on programme and budget. The new 19,500 sq. ft. Lidl foodstore 
was handed over in June and they opened to the public during October. As 
previously reported Lidl entered into a 25-year lease (break at year 20) with 
CPI linked reviews at a rent of £430,000 per annum and the rent-free period has 
expired. Monitoring of the car park revealed a marked increase in vehicle 
numbers entering the retail park, which can mainly be attributed to the opening 
of the new Lidl store. The adjoining 9,500 sq. ft. unit has also completed and 
is being marketed to let. 
 
The store created for Deichmann Shoes (rent £168,000 per annum) is now open and 
trading, unfortunately the letting of the adjacent unit fell through and it 
will be remarketed after lockdown 3.0. 
 
Following exhaustive negotiations, we elected not to renew the leases with Next 
and New Look, the former offering uncompetitive terms and the latter subject to 
a CVA which resulted in a rent which was linked solely to turnover. These two 
units adjoin one another and comprise approximately 20,000 sq. ft. of retail 
space. In February 2021 contracts were exchanged with TJ Morris, trading as 
Home Bargains, to take both units on a new 20-year lease (no breaks) at a rent 
of £17.50 per sq. ft. Construction has commenced to combine the units. This new 
store will be an added attraction to the Park being a further move towards more 
convenience-based retailing which is expected to be more sustainable in out of 
town locations. There are other asset management initiatives that are in 
advanced negotiations and it is hoped that these can be wrapped up as we exit 
lockdown 3.0. 
 
Solihull (retail warehouse) 
The demolition and redevelopment of the former 36,500 sq. ft. Homebase unit 
progressed throughout the year uninterrupted by Covid restrictions. Marks & 
Spencer entered into a new 20-year lease (breaks at year 10 and 15) for a 
redeveloped 35,000 sq. ft. store combined with the adjacent M&S Food Hall. The 
combined unit creates 82,000 sq. ft. providing a new full provision general 
merchandise store, a larger food hall and M&S café. 
 
The construction of the new unit and refurbishment of the shopfront of the Food 
Hall completed on programme and to budget. The new M&S store was handed over to 
commence shop-fitting on 19 January 2021 and M&S is expected to be ready to 
open their new flagship store in June 2021. The new lease is at a rent of £ 
1.373 million subject to a rent-free period which expires in May 2021. 
 
M&S have announced they will be closing their town centre store in Solihull and 
as such this reinforces the strength and draw of Sears Retail Park and we have 
confidence that upon opening, footfall will increase and other retailers will 
be attracted to the location. 
 
Broadway, Wimbledon, London SW19 (retail/alternatives) 
The capital value of Wimbledon has fallen 24.2 per cent over the year. Rent 
collection for the asset has been significantly impacted, with a cinema and a 
gym accounting for 48 per cent of the rental value and being unable to trade 
for substantial periods of time. Rental concessions and deferred repayment 
plans have been agreed with both Odeon and Nuffield Gym and further concessions 
agreed with a number of the other tenants. As a consequence of the latest 
lockdown it is anticipated further concessions will be required. As an 
essential retailer, Morrisons continues to trade throughout the lockdowns and 
this supermarket accounts for 30 per cent of contracted rents. 
 
We continue to work closely with Merton Council in looking at the options for 
the Company's ownership, as part of the Wimbledon Town Centre Masterplan. This 
could provide the Company with a valuable redevelopment opportunity, enhancing 
future prospects for this asset. 
 
St. Christopher's Place Estate (retail/office/alternatives) 
During the past 12 months footfall across Central London has been severely 
supressed due to restrictions on movement and unnecessary travel, the decline 
in both domestic and international tourists and government advice to office 
workers to work from home. St Christopher's Place with its added reliance on 
public transport has been significantly impacted and disrupted by the measures. 
 
The non-essential shops and food and beverage (F&B) tenants are closed at 
present due to the current Lockdown, with the exception of takeaway and 
delivery services. The recently announced roadmap out of Lockdown advises that 
non-essential shops are expected to open 'not before' 12th April, with indoor 
hospitality earmarked for 17th May. There is an opportunity for F&B tenants to 
offer outside dining from 12th April if conditions allow. Since the first 
Lockdown non-essential shops will have lost approximately 8 months of trade and 
restaurants 9 months (excluding the opportunity to trade externally). This 
includes the busiest time of the year in the run up to Christmas. 
 
When Lockdown 1.0. restrictions were lifted in Summer 2020, the majority of the 
estate's tenants opened and footfall levels grew incrementally week on week, 
reaching around 50 per cent of the previous year's levels with weekly footfall 
growth outperforming the rest of the West End. The temporary road closure of 
James Street to vehicles was a success, providing the estate's F&B tenants with 
the opportunity to create additional external dining space and to accommodate 
safe physical distancing practices, which encouraged people to visit the area. 
The 'Eat Out to Help Out' scheme during August was particularly beneficial to 
restaurant turnover. 
 
By Autumn 2020, the estate was recovering reasonably well and becoming a 
vibrant destination once again, particularly with our restaurant offer. 
However, the second lockdown in November followed by the imposition of Tier 4 
controls in London and the introduction of Lockdown 3.0. meant that all 
non-essential retail and restaurants had to close once more and have remained 
shut ever since. 
 
Across the estate, rent support has been offered to tenants on a case by case 
basis with many of the concessionary agreements expected to remain in place 
until at least the end of this year. It is hoped this support will ensure our 
tenants will be in a position to benefit from re-opening and the expected 
bounce back and recovery during the second half of this year. 
 
The capital value of St Christopher's Place has fallen 17.0 per cent over the 
year. This is the result of pressure on both the retail and F&B sectors, with 
both a decline in headline rental values and capitalisation rates moving out. 
In particular, the holdings on Oxford Street have been hit with a significant 
rebasing of rents. 
 
The estate is the principal food and beverage destination for the area around 
the Bond Street/Oxford Street interchange and is a core investment with a 
history of strong performance. Oxford Street is currently experiencing many 
challenges with high profile retail failures resulting in increasing vacancy 
levels, especially amongst larger shops and department stores. Rental values 
along the street have rebased, falling from a peak of £990 per sf ft. to £750 
per sq. ft. 
 
Despite the challenges faced above and looking forward, there are positive 
developments for the Estate. Westminster City Council are supportive of 
extending the temporary road closure of James Street and separately, they have 
reportedly committed £150m to kick start the Oxford Street District Improvement 
programme, to encourage inward investment in advance of the Elizabeth Line 
opening in 2022. This investment and focus to support the immediate area 
surrounding St Christopher's Place is a positive response to promote the 
recovery of Oxford Street and London's West End. 
 
Unsurprisingly, there were some tenant casualties during the year. Of 
particular note were Carluccios at 3-5 Barrett Street who undertook a CVA with 
the Administrators securing a buyer for the business. Despite the new buyer, 
our preference was to agree a new lease with a different operator as reported 
below. Aldo at 372 Oxford Street is in Administration and the store remains 
closed and the rent was paid through a bank guarantee until January 2021. Pizza 
Express: 21-22 Barrett Street has undertaken a CVA but this restaurant is 
unaffected and will remain open with no impact on rent. 
 
Notwithstanding the challenges highlighted above, there has been a number of 
important and successful leasing deals centred around the repositioning of 
James Street which bode well for when the Estate is allowed to re-open. 
 
Letting Activity 
. New letting to Flat Iron at 42-44 James Street. Flat Iron is a steak 
restaurant accessible to all with eight sites in Central London. This offering 
will complement the existing choice of establishments along James Street. 
 
. 36 James St: following the surrender of the T Burrows lease, a new letting 
completed to 'Chrome' which is a coffee and sweet treats café concept. 
 
. Completed on a new letting to a southern Asia grab & go food concept, 
'Papa-dum' at 20 James St. in quarter 1 2021. 
 
. The contractor completed building works at 54/56 James St and a new letting 
to 'Sidechick' completed in March 2021. This restaurant is a new concept from 
the owners of Patty and Bun, an existing tenant on the Estate, and underwrites 
their support for the location. 
 
. Secured a new letting of office space at 3-5 Barrett Street and completed a 
number of lease renewals with office tenants. 
 
. A surrender of the Carluccio's lease was completed at the end of September 
simultaneously with a re-letting to San Carlo Holdings Ltd (part of the San 
Carlo restaurant group) on a new 15-year lease at rent in excess of £400,000 
pa. This will be a significant new operator for the estate, and it is 
encouraging that such a high-profile restaurateur recognises the long-term 
benefits and opportunity presented at the location. 
 
We are encouraged by these new leases which give an indication that some 
occupiers are looking beyond the short-term challenges presented by Covid for 
the Estate to the opportunities that should exist longer term. 
 
Offices 
The past 12 months have been challenging for the Office sector. Understandably 
Covid and the Government's advice to work from home has significantly affected 
office take up and performance is therefore well down on the long-term average. 
Availability has increased largely due to the amount of 'grey space' being 
brought to the market by occupiers wanting to reduce their total floor space 
exposure. Central London has seen availability increase twofold with a vacancy 
rate in excess of 7 per cent but this is biased towards small floors and poor 
specification space. More people will work in an agile fashion but the early 
prognosis of the death of the office appears exaggerated and many large 
corporates now confirm the expectation of a return to near normal office 
occupation citing, productivity, collaboration, culture and wellbeing as key 
reasons. It is expected that offices will be used slightly differently in the 
future, majoring on collaboration space, wellness, flexibility and a flight to 
quality. 
 
An office building that has been under the spotlight is The Leonardo Building, 
Crawley, let to Virgin Atlantic. Much of lockdown 1.0 was spent negotiating 
with Virgin as part of their corporate financial restructuring. We contracted a 
legal agreement granting them a 12-month rent free period, spread over 5 years 
by rebasing the rent from £23.00 to £18.90 per sq. ft. At the end of this 
5-year period Virgin have the option to take a 2.5-year reversionary lease on 
the property or to repay 50 per cent of the monetary value of the concession 
back to the Company. 
 
Notwithstanding the current challenges, the Company has a high quality and 
diversified office exposure with a mix of city centre and out of town locations 
and although the occupational markets were subdued there was some encouraging 
activity in the portfolio. 
 
Cassini House, London SW1 is now fully occupied following the letting to Mitsui 
Fudosan in February 2020. This is a refurbished freehold trophy asset in the 
heart of St James's providing a high-quality secure income stream. 
 
Substantial progress was made at Watchmoor Park, Camberley where the 
refurbishment of two floors and the reception completed. These works were fully 
funded by the settlement of a dilapidations claim with the former tenant. A 
letting of 7,200 sq. ft. on the second floor completed to Muller (Milk and 
More) at a rent of £23.00 per sq. ft. for a term of 5 years with a tenant 
option to renew for a further 10 years. The agreed rent is substantially ahead 
of the rent paid by the previous tenant of £14.00 per sq. ft. and an uplift on 
the rents achieved on lettings in 2019. Terms have been agreed to let the 
remaining 12,500 sq. ft. of vacant space in the property and this is now under 
offer. 
 
At 2-4 King Street, London SW1, a lease re-gear with one of the tenant's 
resulted in a further 5-year term certain on two of the floors. At 17a Curzon 
Street, London W1 the refurbished fourth floor let during the year. The first 
and second floors which are also refurbished are still available to let but 
with renewed interest since the New Year. 
 
Industrial and Logistics 
Negotiations with tenants on lease events were delayed during the first 
lockdown, however, these gained momentum later in the year and we are able to 
report a number of successful and value accretive outcomes where we have 
negotiated lease renewals, let properties and removed credit risk from the 
portfolio. 
 
During the year Mothercare fully honoured their Plc guarantor obligations on 
their logistics unit at Daventry by completing an assignment of the lease 
following their UK trading entity's administration. In June, Clipper Logistics 
took a short-term sub-lease of this 300,000 sq. ft. facility on behalf of the 
NHS to provide storage and distribution of PPE. In March 2021 Mothercare 
assigned their lease to Ceva Logistics, one of the largest third-party 
logistics operators in Europe. This will enable Ceva Logistics to service a 
major contract from the property which is highly accessible and adjacent to 
junction 18 of the M1 motorway. There has been no loss of income to the Company 
due to Mothercare's administration. 
 
A reversionary lease completed with the existing tenant at G Park, Liverpool, a 
360,000 sq. ft. distribution warehouse. The 10-year lease with DHL Supply Chain 
Limited from March 2021 has the benefit of a tenant break at the end of the 
fifth year and the rent contracted at £5.25 sq. ft. reflects an uplift in 
excess of 10 per cent on the current rent. DHL were granted a 6 months 
rent-free period by way of 12 months at half rent. This resulted in a valuation 
uplift of £4.475m and the Company has de-risked the portfolio to its second 
largest lease expiry in 2021. 
 
In February 2021, a new letting of Hurricane 47, Estuary Business Park 
contracted to an on-line rug retailer. This is good news as the leasing of this 
47,000 sq. ft. unit had taken longer than expected. Kukoon Rugs have entered 
into a 15-year lease (tenant break at 10 years) at a rent of £290,000 per annum 
and were granted 6 months' rent free with a further 6 months by way of 12 
months at half rent. 
 
At the Cowdray Centre, Colchester we secured detailed planning consent for the 
demolition of existing properties and the development of a new trade scheme 
totalling approximately 30,000 sq. ft. It is expected we will commence the 
first phase of this development during the course of this year. 
 
Elsewhere we have agreed to defer tenant break clauses for Amazon in 
Southampton and at Hams Hall, Birmingham where Jaguar Land Rover want the 
future flexibility to allow them to control and lease property direct. 
 
Good progress has also been made on a number of other leasing events. Terms 
have been agreed for the lease renewal of Kimberly Clark at their distribution 
warehouse located in Chorley and solicitors instructed to prepare the new lease 
which is expected to complete shortly. This lease event is the largest lease 
expiry due in 2021 and together with the DHL commitment at Liverpool removes a 
significant amount of risk from the portfolio. 
 
Industrial sale 
The sale of Phase 2 of the former Ozalid Works site in Colchester completed to 
Persimmon Homes at a price of £5.5 million on 30 July 2020. This was a disposal 
of non-income producing land and obsolete industrial buildings with planning 
consent for residential development. 
 
The Alternative property sector 
Alternatives comprise 10.2 per cent of the portfolio and relate to the 
purpose-built student accommodation in Winchester, residential properties at 
St. Christopher's Place and the leisure units at Wimbledon Broadway. Winchester 
continues to benefit from a long lease and annual RPI linked rent reviews. The 
University have paid their rent in full and on time. The occupation of the 
short-term residential units at St Christopher's Place was unsurprisingly poor 
during lockdown. 
 
Outlook 
The Company's largest holding has been severely impacted but we believe Central 
London will recover and prime West End real estate with strong hospitality 
linkages such as St Christopher's Place will benefit from both an initial 
bounce back when restrictions are lifted and from a longer term recovery. A 
substantial number of properties in the portfolio have significant asset 
management opportunities which need to be worked through over the next couple 
of years. We are confident these will be accretive to both income and value. 
 
As the vaccination rollout becomes more widespread and restrictions are finally 
eased or lifted, we will see greater certainty returning to the market, lifting 
confidence and valuations alike. Brexit has been somewhat overshadowed by the 
pandemic but, now triggered, it is causing some disruption which may be more 
than frictional. As an asset class, real estate will continue to be supported 
by a low interest rates environment, providing it with a yield advantage over 
most other domestic and overseas asset classes. 
 
While the adjustment in retail may have further to go, it is important to 
distinguish between pandemic-related change and permanent structural change. 
The Company's portfolio of retail assets is of high quality, with significant 
potential for further development as we re-position them to grocery and 
convenience led retail propositions. The office sector outlook is heavily 
dependent on the balance struck between home-working and the need for 
office-based collaborative working and social interaction. The way offices are 
used will change to a more agile model and to have more collaborative space. 
There has been much commentary over future demand for offices, but we are now 
seeing many companies restating the future need of offices to support the 
wellbeing of staff. The polarisation seen between prime and secondary office 
stock is likely to become more pronounced. The need for flexibility either in 
the lease structure, whether manifested as shorter lease lengths or turnover 
rents, or indeed as re-purposing, is expected to persist. Most importantly, is 
to acknowledge the variation in performance at the asset as well as sector 
level. Stock selection and a forensic attention to detail in asset management 
will be key to delivering performance. 
 
Whilst the portfolio positioning has been challenging during the pandemic, it 
remains invested in prime real estate with positive ESG credentials which will 
be further enhanced as ESG becomes critically important and a key determinant 
of performance. Portfolio positioning will be reviewed, and on the back of a 
robust investment process a number of targeted sales will be brought forward 
with proceeds re-invested into sectors and properties which have a long-term 
structural future. 
 
Richard Kirby and Matthew Howard 
Fund Manager 
BMO REP Asset Management plc 
 
 
 
 
BMO Commercial Property Trust Limited 
 
Consolidated Statement of Comprehensive Income (audited) 
 
                                                            Year ended     Year ended 
                                                           31 December    31 December 
                                                                  2020           2019 
 
                                                                 £'000          £'000 
 
Revenue 
 
Rental income                                                   65,273         64,380 
 
                                                             ---------      --------- 
 
Total revenue                                                   65,273         64,380 
 
(Losses)/gains on investment properties 
 
Unrealised losses on revaluation of investment               (121,306)       (63,045) 
properties 
 
(Losses) / Gains on sale of investment properties                 (22)          1,321 
realised 
 
                                                            ----------     ---------- 
 
Total (loss) / income                                         (56,055)          2,656 
 
                                                            ----------     ---------- 
 
Expenditure 
 
Investment management fee                                      (6,692)        (7,446) 
 
Other expenses                                                 (9,448)        (5,877) 
 
                                                            ----------     ---------- 
 
Total expenditure                                             (16,140)       (13,323) 
 
                                                           -----------    ----------- 
 
 
Operating loss before finance costs and taxation              (72,195)       (10,667) 
 
                                                           -----------    ----------- 
 
Net finance costs 
 
Interest receivable                                                 49             42 
 
Finance costs                                                 (11,210)       (10,916) 
 
                                                           -----------    ----------- 
 
                                                              (11,161)       (10,874) 
 
                                                           -----------    ----------- 
 
Loss before taxation                                          (83,356)       (21,541) 
 
Taxation                                                         (890)          (934) 
 
                                                            ----------     ---------- 
 
Loss for the year                                             (84,246)       (22,475) 
 
                                                            ----------     ---------- 
 
Other comprehensive income 
 
Items that are or may be reclassified subsequently 
to profit or loss 
 
Movement in fair value of effective interest rate                 (20)          (319) 
swaps 
 
                                                            ----------     ---------- 
 
Total comprehensive loss for the year, net of tax             (84,266)       (22,794) 
 
                                                            ----------     ---------- 
 
Basic and diluted earnings per share                           (10.5)p         (2.8)p 
 
All of the profit and total comprehensive income for the year is attributable 
to the owners of the Group. 
 
All items in the above statement derive from continuing operations. 
 
 
 
BMO Commercial Property Trust Limited 
 
Consolidated Balance Sheet (audited) 
 
                                                                As at           As at 
                                                          31 December     31 December 
                                                                 2020            2019 
                                                                £'000           £'000 
 
Non-current assets 
 
Investment properties                                       1,205,293       1,314,973 
 
Trade and other receivables                                    20,593          20,816 
 
                                                         ------------    ------------ 
 
                                                            1,225,886       1,335,789 
 
                                                         ------------    ------------ 
 
Current assets 
 
Investment properties held for sale                                 -           5,235 
 
Trade and other receivables                                    11,589           7,561 
 
Taxation receivable                                               134             112 
 
Cash and cash equivalents                                      34,896          25,894 
 
                                                         ------------    ------------ 
 
                                                               46,619          38,802 
 
                                                         ------------    ------------ 
 
Total assets                                                1,272,505       1,374,591 
 
                                                         ------------    ------------ 
 
Current liabilities 
 
Trade and other payables                                     (22,644)        (17,197) 
 
                                                         ------------    ------------ 
 
                                                             (22,644)        (17,197) 
 
Non-current liabilities 
 
Trade and other payables                                      (1,677)         (2,119) 
 
Interest-bearing loans                                      (308,303)       (308,366) 
 
Interest rate swaps                                             (237)           (217) 
 
                                                         ------------    ------------ 
 
                                                            (310,217)       (310,702) 
 
                                                         ------------    ------------ 
 
Total liabilities                                           (332,861)       (327,899) 
 
                                                         ------------    ------------ 
 
Net assets                                                    939,644       1,046,692 
 
                                                         ------------    ------------ 
 
Represented by: 
 
Share capital                                                   7,994           7,994 
 
Special reserve                                               589,593         589,593 
 
Capital reserve - investments sold                           (16,720)        (20,725) 
 
Capital reserve - investments held                            245,613         370,946 
 
Hedging reserve                                                 (237)           (217) 
 
Revenue reserve                                               113,401          99,101 
 
                                                         ------------    ------------ 
 
Equity shareholders' funds                                    939,644       1,046,692 
 
                                                         ------------    ------------ 
 
Net asset value per share                                      117.5p          130.9p 
 
 
 
BMO Commercial Property Trust Limited 
 
Consolidated Statement of Changes in Equity 
for the year ended 31 December 2020 (audited) 
 
                                       Capital     Capital 
                                     Reserve -  Reserve - 
                     Share Special Investments Investments  Hedging  Revenue 
                   Capital Reserve        Sold        Held  Reserve  Reserve      Total 
                     £'000   £'000       £'000       £'000    £'000    £'000      £'000 
 
At 1 January 2020    7,994 589,593    (20,725)     370,946    (217)   99,101  1,046,692 
 
Total 
comprehensive 
income for the 
year 
 
Loss for the year        -       -           -           -        - (84,246)   (84,246) 
 
Movement in fair 
value of interest        -       -           -           -     (20)        -       (20) 
rate swaps 
 
Transfer in 
respect of 
unrealised losses        -       -           -   (121,306)        -  121,306          - 
on investment 
properties 
 
Losses on sale of 
investment               -       -        (22)           -        -       22          - 
properties 
realised 
 
Transfer of prior 
years' 
revaluations to          -       -       4,027     (4,027)        -        -          - 
realised reserve 
 
Total 
comprehensive            -       -       4,005   (125,333)     (20)   37,082   (84,266) 
income for the 
year 
 
Transactions with 
owners of the 
Company recognised 
directly in equity 
 
Dividends paid           -       -           -           -        - (22,782)   (22,782) 
 
 
At 31 December       7,994 589,593    (16,720)     245,613    (237)  113,401    939,644 
2020 
 
 
 
Consolidated Statement of Changes in Equity 
for the year ended 31 December 2019 (audited) 
 
                                       Capital     Capital 
                                     Reserve -  Reserve - 
                     Share Special Investments Investments  Hedging  Revenue 
                   Capital Reserve        Sold        Held  Reserve  Reserve      Total 
                     £'000   £'000       £'000       £'000    £'000    £'000      £'000 
 
At 1 January 2019    7,994 589,593       1,708     410,237      102  107,814  1,117,448 
 
Total 
comprehensive 
income for the 
year 
 
Loss for the year        -       -           -           -        - (22,475)   (22,475) 
 
Movement in fair 
value of interest        -       -           -           -    (319)        -      (319) 
rate swaps 
 
Transfer in 
respect of 
unrealised losses        -       -           -    (63,045)        -   63,045          - 
on investment 
properties 
 
Gains on sale of 
investment               -       -       1,321           -        -  (1,321)          - 
properties 
realised 
 
Transfer of prior 
years' 
revaluations to          -       -    (23,754)      23,754        -        -          - 
realised reserve 
 
Total 
comprehensive            -       -    (22,433)    (39,291)    (319)   39,249   (22,794) 
income for the 
year 
 
Transactions with 
owners of the 
Company recognised 
directly in equity 
 
Dividends paid           -       -           -           -        - (47,962)   (47,962) 
 
 
At 31 December       7,994 589,593    (20,725)     370,946    (217)   99,101  1,046,692 
2019 
 
 
 
BMO Commercial Property Trust Limited 
 
Consolidated Statement of Cash Flows (audited) 
 
                                                             Year ended   Year ended 
                                                            31 December  31 December 
                                                                   2020         2019 
 
                                                                  £'000        £'000 
 
Cash flows from operating activities 
 
Loss for the year before taxation                              (83,356)     (21,541) 
 
Adjustments for: 
 
     Finance costs                                               11,210       10,916 
 
     Interest receivable                                           (49)         (42) 
 
     Unrealised losses on revaluation of investment             121,306       63,045 
properties 
 
     Losses / (gains) on sale of investment properties               22      (1,321) 
realised 
 
     Increase in operating trade and other receivables          (3,972)      (2,617) 
 
     Increase in operating trade and other payables               5,087        1,307 
 
                                                            -----------  ----------- 
 
Cash generated from operations                                   50,248       49,747 
 
                                                            -----------  ----------- 
 
     Interest received                                               49           42 
 
     Interest and bank fees paid                               (10,528)     (10,549) 
 
     Tax paid                                                     (890)      (2,076) 
 
                                                            -----------  ----------- 
 
                                                               (11,369)     (12,583) 
 
                                                            -----------  ----------- 
 
Net cash inflow from operating activities                        38,879       37,164 
 
                                                            -----------  ----------- 
 
Cash flows from investing activities 
 
Sale of investment properties                                     5,585       34,428 
 
Capital expenditure on investment properties                   (12,080)      (7,863) 
 
                                                            -----------  ----------- 
 
Net cash (outflow)/inflow from investing activities             (6,495)       26,565 
 
                                                            -----------  ----------- 
 
Cash flows from financing activities 
 
Dividends paid                                                 (22,782)     (47,962) 
 
Issue costs for Barclays £100m loan facility extension            (600)            - 
 
                                                            -----------  ----------- 
 
Net cash outflow from financing activities                     (23,382)     (47,962) 
 
                                                            -----------  ----------- 
 
Net increase in cash and cash equivalents                         9,002       15,767 
 
Opening cash and cash equivalents                                25,894       10,127 
 
                                                            -----------  ----------- 
 
Closing cash and cash equivalents                                34,896       25,894 
 
                                                            -----------  ----------- 
 
 
 
BMO Commercial Property Trust Limited 
 
Principal Risks and Future Prospects 
 
Each year the Board carries out a comprehensive, robust assessment of the 
principal risks and uncertainties that could threaten the Company's success. 
The consequences for its business model, liquidity, future prospects and 
viability form an integral part of this assessment. 
 
The Board applies the principles detailed in the internal control guidance 
issued by the Financial Reporting Council, and has established an ongoing 
process designed to meet the particular needs of the Company in managing the 
risks and uncertainties to which it is exposed. 
 
Consideration has been given to the impact from Covid-19 which has had a 
significant effect on the commercial real estate market. This has resulted in a 
number of the residual risks increasing as highlighted in the table below. 
 
Principal risks and uncertainties faced by the Company are described below. 
 
. Market - the Company's assets comprise direct investments in UK commercial 
property and it is therefore exposed to movements and changes in that market. 
This includes political and economic factors such as Brexit and the impact of 
Covid-19. 
 
. Investment and strategic - poor investment decisions and incorrect strategy, 
including sector and geographic allocations, use of gearing, inadequate asset 
management activity and tenant defaults could lead to poor returns for 
shareholders. 
 
. Regulatory - breach of regulatory rules could lead to suspension of the 
Company's London Stock Exchange listing, financial penalties or a qualified 
audit report. 
 
. Environmental - inadequate attendance to environmental factors by the 
Managers, including those of a regulatory and market nature and particularly 
those relating to energy performance, health and safety, climate risk and 
environmental liabilities, leading to the reputational damage of the Company, 
reduced liquidity in the portfolio, and/or negative asset value impacts. 
 
. Tax structuring and compliance - the Company should ensure compliance with 
relevant tax rules and thresholds at all times. Changes to tax legislation 
could have an adverse financial impact. 
 
. Operational - The Group outsources its operations to the Managers' and other 
third-party service providers. Any failure of those providers internal control 
systems, and in particular the Managers' accounting systems or general 
disruption to their businesses, through cyber or other threats could lead to an 
inability to provide accurate reporting and monitoring control or loss of data, 
leading to a loss of shareholders' confidence. 
 
. Financial - inadequate controls by the Managers or other third-party service 
providers could lead to misappropriation of assets. Inappropriate accounting 
policies or failure to comply with accounting standards could lead to a 
qualified audit report, misreporting or breaches of regulations. Breaching 
Guernsey solvency test requirements or loan covenants could lead to a loss of 
shareholders' confidence and financial loss for shareholders. 
 
The Board seeks to mitigate and manage these risks through continual review, 
policy-setting and enforcement of contractual obligations, as well as a review 
by the Audit and Risk Committee of the Internal Control reports prepared in 
accordance with AAF(01/06). 
 
To mitigate investment and strategic risks the Board regularly monitors the 
investment environment and the management of the Company's property portfolio. 
The Managers seek to mitigate the portfolio risks through active asset 
management initiatives and carrying out due diligence work on potential tenants 
before entering into any new lease agreements. All of the properties in the 
portfolio are insured. 
 
As well as considering current risks quarterly, the Board and the Investment 
Manager carry out a separate annual assessment of emerging risks when reviewing 
strategy and evaluate how these could be managed or mitigated. However, the 
Board considers that the line between current and emerging risks is often 
blurred and many of the emerging risks identified are already being managed to 
some degree where their effects are beginning to impact. 
 
The principal emerging risks identified are outlined below: 
 
. The structural changes in the retail market is a significant emerging risk, 
particularly as the prominence of online shopping continues to increase. Over 
the last two years the market has experienced a number of high-profile 
retailers going out of business, downsizing, closing stores and negotiating 
flexible leases at lower rents. With an increasing number of vacant stores, the 
challenge is to find different uses for commercial property, whether that's for 
residential, leisure, food and beverage, or other alternative uses. 
 
. There is also the potential for structural change in the office market as 
many companies look to the feasibility of implementing a hybrid model for 
staff, which would involve them working partly in the office and partly at 
home. There is uncertainty how this will play out and it continues to be 
monitored. 
 
. The ESG agenda is a very prominent one and will continue to grow in its 
importance to shareholders, future investors and our customers. We have already 
made significant strides in this area and we will continue to do so. The 
increasing market attention being paid to climate risk and social impact have 
been notable features of the evolving agenda over the last year, and those need 
to be considered more explicitly in property investment and management activity 
than has been the case previously. 
 
. The political climate continues to be uncertain and as well as the ongoing 
effects of Brexit, there are strong calls for another Scottish referendum. 
During times of heightened uncertainty, a key benefit to the Company is its 
closed-ended structure, in that it is not forced to sell property during 
stressed times. 
 
.Legislative changes are always a risk, particularly where they are politically 
driven and may cause changes in our property allocation. Such issues might 
involve some style of rent control or an escalation of regulatory oversight on 
ESG factors, particularly in responding to the climate emergency. 
 
. The impact of technology increasingly means that things change very quickly 
which is an opportunity as well as a risk, and it is important that we continue 
to keep abreast of what is happening in this space. This has been compounded 
over the last year as the reliance on technology, particularly with regards to 
home working has increased. 
 
. The effects of Covid-19 has been the dominant risk for the global economy, 
and by extension the UK property market. The effects have been extensive with 
significant disruption to all sectors worldwide. This has had an ongoing effect 
on many of our principal risks and the Board meet regularly with the Manager to 
assess these risks and how they can be managed. More detail is included in the 
Chairman's Statement and the Manager's Report. Of particular concern has been 
the Company's cash flow, given the number of expected defaults from tenants 
unable to trade or operating at restricted levels. Against this background, the 
Board took the decision to suspend the monthly dividend in April 2020 to 
maximise the cash reserves available. Collection rates have been at c.87 per 
cent since the outbreak, which is ahead of those anticipated and a dividend of 
50 per cent of the original monthly rate was reintroduced in August 2020 before 
being increased to 70 per cent in December 2020. In addition, the Group is in 
regular contact with its lenders in case the decline in rent collected causes 
certain covenants to be breached or become close to being breached. 
 
To help manage emerging risks and discuss other wider topics affecting 
property, the Board invites to Board Meetings various experts to give their 
views and promote discussion. The Board considers having a clear strategy is 
the key to managing and mitigating emerging risk. 
 
The highest residual risks encountered during the year, how they are mitigated 
and actions taken to address these are set out in the table below. 
 
Highest Residual Risks      Mitigation                  Actions taken in the year 
 
Unfavourable markets, poor  The underlying investment   The Board reviews the 
stock selection,            strategy, performance,      Manager's performance at 
inappropriate asset         gearing and income          quarterly Board meetings 
allocation and              forecasts are reviewed with against key performance 
underperformance against    the Investment Manager at   indicators and the ongoing 
benchmark and/or peer       each Board Meeting. The     strategy is reviewed and 
group. This risk may be     Company's portfolio is well agreed. 
exacerbated by gearing      diversified and of a high   The Board has met on a 
levels.                     quality. Gearing is kept at significantly more frequent 
A challenging retail market modest levels and is        basis since the outbreak of 
where rental growth is      monitored by the Board.     Covid-19 where it has 
generally negative and      The Manager provides        received trading updates 
capital values are falling  regular information on the  from the Manager and 
as capitalisation rates     expected level of rental    carefully reviewed cash 
rebase.                     income that will be         forecasts. 
This market has witnessed   generated from underlying   Rental collection in the 
many Company Voluntary      properties. The portfolio   retail and leisure sectors 
Arrangements and            is well diversified by      has been negatively impacted 
administrations in the last geography and sector and    by Covid-19. The Manager is 
two years.                  the exposure to individual  in regular contact with 
There is an increased risk  tenants is monitored and    tenants and rental 
of tenant defaults in the   managed to ensure there is  collection is a primary 
retail and leisure sectors  no over exposure.           focus. Collection rates 
since the Covid-19                                      since the Covid-19 outbreak 
outbreak, which has put the                             have been ahead of original 
level of dividend cover at                              expectations. 
risk. 
 
 
Risk increased in the year 
under review 
 
The share price has been    The discount is reported to Investors have access to the 
trading at a discount and   and reviewed by the Board   Manager and the underlying 
this has widened            at least quarterly. Share   team who will respond to any 
significantly since the     buybacks as a means of      queries they have on the 
Covid-19 outbreak. This     narrowing the discount or   discount. The level of 
imbalance, combined with    as an attractive investment discount is kept under 
the recent share price      for the Company are         constant review and the 
volatility can diminish the considered and weighed up   number of meetings to 
attractiveness of the       against the risks. The      discuss the discount 
Company to investors.       position is monitored by    increased during the year. 
                            the Manager on a daily      The use of share buybacks as 
                            basis and any material      a method of reducing the 
                            changes are investigated    discount were regularly 
                            and communicated to the     considered during the year 
                            Board more regularly.       and it was decided that the 
                                                        priority was the 
                                                        preservation of cash and not 
                                                        being a forced seller of 
                                                        property. The use of share 
Risk increased in the year                              buybacks remain under 
under review                                            consideration for the coming 
                                                        year. At the Board's request 
                                                        there has been increased 
                                                        reporting from the broker on 
                                                        the market and the 
                                                        shareholder feedback they 
                                                        are receiving. 
 
 
Insufficient cash resources The Manager reports         The Board have held 
to meet capital commitments regularly on ongoing        additional ad-hoc Board 
or to fund the monthly      revenue collection, cash    Meetings since the Covid-19 
dividend leading to         forecasting and compliance  outbreak which includes 
emergency sale of assets    with banking covenants. The revenue and cash 
and/or cutting of dividend  Group performs a solvency   forecasting. 
level.                      test in advance of each     A decision was made to 
                            dividend payment. A         suspend the dividend in 
                            detailed cash flow model is April 2020 to protect cash 
                            included in the Board       resources. Collection levels 
                            papers, as well as a        were ahead of expectations 
                            schedule on immediate cash  and a monthly dividend of 50 
                            commitments.                per cent of the original 
                                                        rate was reintroduced in 
                                                        August 2020. A further 
                                                        increase to 70 per cent was 
                                                        introduced from December 
                                                        2020. The rate and 
                                                        sustainability of the 
                                                        dividend remains under 
                                                        continual review. 
                                                        Compliance with the Group's 
                                                        banking covenants remain 
                                                        under continual review. All 
                                                        covenant tests attached to 
                                                        the Group's long-term debt 
                                                        with L&G were met throughout 
Risk increased in the year                              the year. Due to the 
under review                                            challenges associated with 
                                                        the pandemic and the impact 
                                                        this has had on rental 
                                                        collection, there was a 
                                                        technical breach on the 
                                                        projected interest cover 
                                                        covenant test under the 
                                                        Barclays £50 million loan 
                                                        facility for the final 
                                                        quarter of 2020. Barclays 
                                                        have been supportive 
                                                        throughout the year and have 
                                                        confirmed that they remain 
                                                        supportive in the current 
                                                        environment and therefore a 
                                                        waiver was provided from 
                                                        this test for that quarter 
                                                        which also covers the first 
                                                        two quarters of 2021. 
 
Improved shareholder        The Investment Manager and  The quality of communication 
communication is key in the broker regularly meet       continues to evolve. Actions 
current environment with    significant shareholders.   during the year include: 
valuations falling and the  The Chairman and Senior     . Further refreshing of the 
shares trading at a         Independent Director offer  Company's website which has 
significant discount.       to meet the largest         an enhanced look and feel, 
It is important that all    shareholder annually and    providing greater detail on 
shareholders have access to are available to meet other the Company's portfolio. 
information on how the      shareholders.               . Detailed quarterly trading 
Company is being run in     The website is kept up to   announcements. 
order to make informed      date and contains relevant  . An increased number of 
investment decisions, which information; complying with meetings with investors 
will help to mitigate       any regulatory              through meetings arranged by 
widespread selling of the   requirements.               the Manager's investor 
Company's shares.           A comprehensive Annual      relations team. 
                            Report is produced, and the 
                            consolidated financial 
Risk increased in the year  statements are 
under review                independently audited. 
 
 
Viability Assessment and Statement 
The Board conducted this review over a five year time horizon, a period thought 
to be appropriate for a Company investing in commercial property with a 
long-term investment outlook, with primary borrowings secured for a further 
four years, a continuation vote in 2024 and a property portfolio with an 
average unexpired lease length of 6.0 years. It is believed that it will be 
possible to satisfactorily refinance the principal loan in 2024 and an 
assumption is made that the continuation vote is passed. The assessment has 
been undertaken, taking into account the principal risks and uncertainties 
faced by the Group, as identified above; which could threaten its objective, 
strategy, future performance, liquidity and solvency. 
 
The major risks identified as relevant to the viability assessment were those 
relating to a downturn in the UK commercial property market and its resultant 
effect on the valuation of the investment property portfolio, the level of 
rental income being received and the effect that this would have on cash 
resources and financial covenants. The Board took into account the illiquid 
nature of the Group's property portfolio, the existence of the long-term 
borrowing facility, the effects of any significant future falls in investment 
property values and property income receipts on the ability to repay and 
re-negotiate borrowings, maintain dividend payments and retain investors. These 
matters were assessed over a period to April 2026, and the Directors will 
continue to assess viability over five year rolling periods, taking account of 
foreseeable severe but plausible scenarios. 
 
In the ordinary course of business, the Board reviews a detailed financial 
model on a quarterly basis, incorporating market consensus forecast returns, 
projected out for five years. This model uses prudent assumptions and factors 
in any potential capital commitments. For the purpose of assessing the 
viability of the Group, the model has been stress tested with projected returns 
comparable to the most extreme UK commercial property market downturn 
experienced in recent history. The model projects a worst case scenario of an 
equivalent fall in capital and diminution of rental values over the next two 
years, followed by three years of zero growth. The model demonstrated that even 
under these extreme circumstances the Group remains viable. 
 
The Group continues to monitor the potential impact of the Covid-19 virus on 
cash flows. Particular attention is paid to the circumstances of all the 
tenants in the portfolio and detailed modelling is performed on a day to day 
basis as events unfold. 
 
Rental collection since the outbreak has been in excess of the levels 
originally anticipated, with the level of rents collected since March 2020 to 
March 2021 averaging 87.3 per cent. In order to preserve cash resources, the 
Board made the decision to suspend the monthly dividend between April 2020 and 
July 2020 before reintroducing a monthly dividend at 50 per cent of the 
original level from August 2020 and 70 per cent from December 2020. 
 
Detailed modelling has been performed, which has looked at the impact of the 
current crisis under increasingly negative scenarios and the modelling 
demonstrates that the Company remains viable. 
 
The Group's £260 million long-term debt with L&G does not need to be refinanced 
until December 2024. We calculate that the market value of the properties 
secured under this loan would have to drop by 39 per cent before breaching the 
Loan to Value ('LTV') test on the facility. The loan interest cover test would 
only be breached by a fall in rental income of 71 per cent. We are comfortable 
that these covenants will continue to be met. 
 
The Group's Barclays £50 million loan facility is due to expire in July 2022 
with an option to extend by two further one-year periods on receiving Barclays 
consent. The LTV test should remain comfortable with a fall of 61 per cent of 
the market value of the properties secured under this loan being required 
before breaching. The assets secured under this loan are provided by the St 
Christopher's Place Estate and the level of rental income receivable from these 
assets has been significantly impacted with many tenants in the retail and 
hospitality sectors unable to trade for large periods since March 2020. There 
was a technical breach on the projected interest cover covenant test for the 
final quarter of 2020. Barclays have been supportive throughout the year and 
have confirmed that they remain supportive in the current environment and 
therefore a waiver was provided from this test for that quarter which also 
covers the first two quarters of 2021. The £50 million of borrowings currently 
drawn down from Barclays are not material to the operation of the Group. 
 
Based on this assessment, and in the context of the Group's business model, 
strategy and operational arrangements set out above, the Directors have a 
reasonable expectation that the Group will be able to continue in operation and 
meet its liabilities as they fall due over the five year period to April 2026. 
For this reason, the Board also considers it appropriate to continue adopting 
the going concern basis in preparing the Annual Report and Consolidated 
Accounts. 
 
 
 
BMO Commercial Property Trust Limited 
 
Going Concern 
 
After making enquiries and bearing in mind the nature of the Group's business 
and assets, the Directors consider that the Group has adequate resources to 
continue in operational existence for the next twelve months. In assessing the 
going concern basis of accounting the Directors have had regard to the guidance 
issued by the Financial Reporting Council. They have considered the current 
cash position of the Group, forecast rental income and other forecast cash 
flows. Based on this information the Directors believe that the Group has the 
ability to meet its financial obligations as they fall due for the foreseeable 
future, which is considered to be for a period of at least twelve months from 
the date of approval of the accounts. For this reason, they continue to adopt 
the going concern basis in preparing the accounts. 
 
 
Statement of Directors' Responsibilities in Respect of the Annual Report and 
Accounts 
 
In accordance with Chapter 4 of the Disclosure and Transparency Rules, we 
confirm that to the best of our knowledge: 
 
  * The financial statements contained within the Annual Report and Accounts 
    for the year ended 31 December 2020, of which this statement of results is 
    an extract, have been prepared in accordance with applicable International 
    Financial Reporting Standards as adopted by the EU, on a going concern 
    basis, and give a true and fair view of the assets, liabilities, financial 
    position and profit or loss of the Group and the undertakings included in 
    the consolidation taken as a whole and comply with The Companies (Guernsey) 
    Law, 2008; and 
 
  * The Chairman's Statement and Managers' Review include a fair review of the 
    development and performance of the business and the position of the Group 
    and the undertakings included in the consolidation taken as a whole, 
    together with a description of the principal risks and uncertainties that 
    they face; and 
 
  * The consolidated financial statements within the Annual Report and Accounts 
    for the year ended 31 December 2020 include details of related party 
    transactions; and 
 
  * The Annual Report and financial statements, taken as a whole, are fair, 
    balanced and understandable and provide the information necessary for 
    shareholders to assess the Group's position and performance, business model 
    and strategy. 
 
 
On behalf of the Board 
 
 
Martin Moore 
Director 
 
 
 
 
BMO Commercial Property Trust Limited 
 
Notes to the audited Consolidated Financial Statements 
for the year ended 31 December 2020 
 
1.         Financial Instruments and investment properties 
 
The Group's investment objective is to provide ordinary shareholders with an 
attractive level of income together with the potential for capital and income 
growth from investing in a diversified UK commercial property portfolio. 
 
Consistent with that objective, the Group holds UK commercial property 
investments. In addition, the Group's financial instruments during the year 
comprised interest-bearing bank loans, cash and receivables and payables that 
arise directly from its operations. The Group does not have exposure to any 
derivative instruments other than the interest rate swap entered into to hedge 
the interest paid on the Barclays interest-bearing bank loan. 
 
The Group is exposed to various types of risk that are associated with 
financial instruments. The most important types are credit risk, liquidity 
risk, interest rate risk and market price risk. There is no foreign currency 
risk as all assets and liabilities of the Group are maintained in pounds 
sterling. 
 
The Board reviews and agrees policies for managing the Group's risk exposure 
including an assessment of the impact of Covid-19. These policies are 
summarised below and have remained unchanged for the year under review. These 
disclosures include, where appropriate, consideration of the Group's investment 
properties which, whilst not constituting financial instruments as defined by 
IFRS, are considered by the Board to be integral to the Group's overall risk 
exposure. 
 
Credit risk 
 
Credit risk is the risk that an issuer or counterparty will be unable or 
unwilling to meet a commitment that it has entered into with the Group. 
 
In the event of default by an occupational tenant, the Group will suffer a 
rental shortfall and incur additional costs, including legal expenses, in 
maintaining, insuring and re-letting the property. The Board receives regular 
reports on concentrations of risk and any tenants in arrears. The Managers 
monitor such reports in order to anticipate, and minimise the impact of, 
defaults by occupational tenants. 
 
All of the Group's cash is placed with financial institutions with a long-term 
credit rating of A or better. Bankruptcy or insolvency of such financial 
institutions may cause the Group's ability to access cash placed on deposit to 
be delayed or limited. Should the credit quality or the financial position of 
the banks currently employed significantly deteriorate, cash holdings would be 
moved to another bank. 
 
Liquidity risk 
 
Liquidity risk is the risk that the Group will encounter in realising assets or 
otherwise raising funds to meet financial commitments. The Group's investments 
comprise UK commercial property. Property and property-related assets in which 
the Group invests are not traded in an organised public market and may be 
illiquid. As a result, the Group may not be able to liquidate quickly its 
investments in these properties at an amount close to their fair value in order 
to meet its liquidity requirements. 
 
The Group's liquidity risk is managed on an ongoing basis by the Managers and 
monitored on a quarterly basis by the Board. In order to mitigate liquidity 
risk, the Group aims to have sufficient cash balances (including the expected 
proceeds of any property sales) to meet its obligations for a period of at 
least twelve months. 
 
Interest rate risk 
 
Some of the Group's financial instruments are interest bearing. They are a mix 
of both fixed and variable rate instruments with differing maturities. As a 
consequence, the Group is exposed to interest rate risk due to fluctuations in 
the prevailing market rate. 
 
The Group's exposure to interest rate risk relates primarily to its long-term 
debt obligations. Interest rate risk on long-term debt obligations is managed 
by fixing the interest rate on such borrowings, either directly or through 
interest rate swaps for the same notional value and duration. Long-term debt 
obligations and the interest rate risk they confer to the Group is considered 
by the Board on a quarterly basis. Long term debt obligations consist of a £260 
million L&G loan on which the rate has been fixed at 3.32 per cent until the 
maturity date of 31 December 2024. The Group also has a £50 million 
interest-bearing bank loan with Barclays on which the rate has been fixed 
through an interest rate swap at 2.872 per cent per annum until the maturity 
date of 21 June 2021. The Group has agreed an additional revolving credit 
facility of £50 million with Barclays over the same period, which has not been 
drawn down as at 31 December 2020. The revolving credit facility pays an 
undrawn commitment fee of 0.72 per cent per annum. 
 
When the Group retains cash balances, they are ordinarily held on 
interest-bearing deposit accounts. The benchmark which determines the interest 
income received on interest bearing cash balances is the bank base rate of the 
Bank of England which was 0.1 per cent as at 31 December 2020 (2019: 0.75 per 
cent). The Company's policy is to hold cash in variable rate or short-term 
fixed rate bank accounts and not usually in fixed rate securities with a term 
greater than three months. 
 
Market price risk 
 
The Group's strategy for the management of market price risk is driven by the 
investment policy. The management of market price risk is part of the 
investment management process and is typical of commercial property investment. 
The portfolio is managed with an awareness of the effects of adverse valuation 
movements through detailed and continuing analysis, with an objective of 
maximising overall returns to shareholders. Investments in property and 
property-related assets are inherently difficult to value due to the individual 
nature of each property. As a result, valuations are subject to substantial 
uncertainty. There is no assurance that the estimates resulting from the 
valuation process will reflect the actual sales price even where such sales 
occur shortly after the valuation date. Such risk is minimised through the 
appointment of external property valuers. 
 
2.         Share Capital 
 
There were 799,366,108 Ordinary Shares in issue at 31 December 2020 (2019: 
799,366,108). 
 
At 31 December 2020, the Company did not hold any Ordinary Shares in treasury 
(2019: nil). 
 
3.         Earnings per share 
 
The basic and diluted earnings per Ordinary Share are based on the loss for the 
year of £84,246,000 (2019: loss £22,475,000) and on 799,366,108 (2019: 
799,366,108) Ordinary Shares, being the weighted average number of shares in 
issue during the year. 
 
4.         List of Subsidiaries 
 
The Company owns 100 per cent of the issued ordinary share capital of FCPT 
Holdings Limited, a company registered in Guernsey. The principal activity of 
FCPT Holdings Limited is to act as a holding company and it owns 100 per cent 
of the ordinary share capital of F&C Commercial Property Holdings Limited, a 
company registered in Guernsey whose principal business is that of an 
investment and property company, and 100 per cent of the ordinary share capital 
of Winchester Burma Limited, a company registered in Guernsey whose principal 
business is that of an investment and property company. 
 
The Company owns 100 per cent of the issued ordinary share capital of SCP 
Estate Holdings Limited, a company registered in Guernsey. The principal 
activity of SCP Estate Holdings Limited is to act as a holding company and it 
owns 100 per cent of the ordinary share capital of SCP Estate Limited, a 
company registered in Guernsey whose principal business is that of an 
investment and property company, and 100 per cent of the ordinary share capital 
of Prime Four Limited, a company registered in Guernsey whose principal 
business is that of an investment and property company. 
 
The Company owns 100 per cent of the issued ordinary share capital of Leonardo 
Crawley Limited, a company registered in Guernsey whose principal business is 
that of an investment and property company. 
 
The results of the above entities are consolidated within the Group financial 
statements. 
 
5.         Capital Commitments 
 
The Group had capital commitments totalling £5,200,000 as at 31 December 2020 
(2019: £2,100,000). These commitments related mainly to contracted development 
work at the Group's property at Solihull, Sears Retail Park. 
 
6.         These are not full statutory accounts. The full audited accounts for 
the year to 31 December 2020 will be sent to shareholders and will be available 
for inspection at Trafalgar Court, Les Banques, St Peter Port, Guernsey GY1 
3QL, the registered office of the Company, and from the Company's website: 
bmocommercialproperty.com 
 
 
 
 
Alternative Performance Measures 
 
The Company uses the following Alternative Performance Measures ('APMs'). APMs 
do not have a standard meaning prescribed by GAAP and therefore may not be 
comparable to similar measures presented by other entities. 
 
Discount or Premium - the share price of an Investment Company is derived from 
buyers and sellers trading their shares on the stock market. This price is not 
identical to the NAV. If the share price is lower than the NAV per share, the 
shares are trading at a discount. This could indicate that there are more 
sellers than buyers. Shares trading at a price above the NAV per share, are 
said to be at a premium. 
 
Dividend Cover - The percentage by which Profits for the year (less Gains/ 
losses on investment properties) cover the dividend paid. 
 
A reconciliation of dividend cover is shown below: 
 
 
                                                              2020        2019 
 
 
                                                             £'000       £'000 
 
Loss for the year                                         (84,246)    (22,475) 
 
Add back:           Unrealised losses on 
                    revaluation of investment              121,306      63,045 
                    properties 
 
                    Losses / (Gains) on sales of 
                    investment properties                       22     (1,321) 
                    realised 
 
Profit before investment gains and losses          (a)      37,082      39,249 
 
Dividends                                          (b)      22,782      47,962 
 
Dividend Cover percentage (c= a/b)                 (c)      162.8%       81.8% 
 
 
Annualised Dividend Yield - The dividends paid during the year divided by the 
share price at the year end. 
 
Net Gearing - Borrowings less cash divided by total assets (less current 
liabilities and cash). 
 
Portfolio (Property) Capital Return - The change in property value during the 
period after taking account of property purchases and sales and capital 
expenditure, calculated on a quarterly time-weighted basis. The calculation is 
carried out by MSCI Inc. 
 
Portfolio (Property) Income Return - The income derived from a property during 
the period as a percentage of the property value, taking account of direct 
property expenditure, calculated on a quarterly time-weighted basis. The 
calculation is carried out by MSCI Inc. 
 
Portfolio (Property) Total Return - Combining the Portfolio Capital Return and 
Portfolio Income Return over the period, calculated on a quarterly 
time-weighted basis. The calculation is carried out by MSCI Inc. 
 
Total Return - The theoretical return to shareholders calculated on a per share 
basis by adding dividends paid in the period to the increase or decrease in the 
Share Price or NAV. The dividends are assumed to have been reinvested in the 
form of Ordinary Shares or Net Assets, respectively, on the date on which they 
were quoted ex-dividend. 
 
 
 
 
All enquiries to: 
 
The Company Secretary 
Northern Trust International Fund Administration (Guernsey) Limited 
Trafalgar Court 
Les Banques 
St. Peter Port 
Guernsey GY1 3QL 
Tel:      01481 745436 
Fax:     01481 745186 
 
Richard Kirby 
BMO REP  Asset Management plc 
Tel:      0207 016 3577 
 
Graeme Caton 
Winterflood Securities Limited 
Tel:      0203 100 0268 
 
 
 
 
END 
 
 

(END) Dow Jones Newswires

April 12, 2021 02:00 ET (06:00 GMT)

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