Real Estate Investors (RLE) really started to gain traction last year after a string of acquisitions pushed rental income up by more than a third to £8.4m. This, and a £8.6m valuation uplift, helped to push up adjusted net asset value by 5 per cent to 64.5p.
The company specialises in buying distressed assets in and around Birmingham with a view to refurbishing and maximising rental income, and there have been plenty of attractive deals coming to the market as the big US finance houses start to dispose of non-core assets picked up at the time of the financial crash. As a consequence, acquisitions during the year nearly doubled to £57.7m. There have also been opportunities to pick up assets that normally would have been snapped up by large institutional investors, but the big players have left the market in the run-up to the EU referendum.
With record inward investment and continued strong demand from a new generation of retail outlets, founder and chief executive Paul Bassi reckons there is more yield compression to come outside the inner city centres, but higher rental income will provide the key driver for growth.
Analysts at Liberum are forecasting adjusted net asset value at the December 2016 year-end of 68.4p, up from 64.5p in 2015.
| REAL ESTATE INVESTORS (RLE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 64p | MARKET VALUE: | £119m | |
| TOUCH: | 62-66p | 12-MONTH HIGH: | 71p | LOW: 59p |
| DIVIDEND YIELD: | 3.1% | TRADING PROPERTIES: | nil | |
| PREMIUM TO NAV: | 1% | NET DEBT: | 30% | |
| INVESTMENT PROPERTIES: | £155m | |||
| Year to 21 Dec | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 54.6 | -6.7 | -8.6 | nil |
| 2012 | 54.6 | 1.0 | 0.5 | 0.5 |
| 2013 | 58.6 | 5.0 | 5.0 | 1 |
| 2014 | 57.9 | 6.0 | 4.1 | 1.5 |
| 2015 | 63.1 | 12.2 | 7.5 | 2 |
| % change | +9 | +104 | +84 | +33 |
Ex-div: 24 Mar Payment: 29 Apr | ||||
