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Very Secure Income

Secure Income Reit has refinanced its balance sheet and expects to pay a maiden dividend next year
September 30, 2015

Comparatives are not straightforward with half-year results from Secure Income Reit (SIR), because the landlord's initial public offering came just last June. However, measuring its progress from the December 2014 year-end provides ample evidence of the group's impressive performance, with net asset value since then jumping by 29 per cent.

IC TIP: Buy at 250p

Mindful of its Reit status, Secure Income expects to start dividend payments in the autumn of next year, with a proposed yield of over 4 per cent, thanks to a revised debt structure. Over £900m of fresh financing has been secured, replacing existing borrowings due in 2017 with nine-year debt, and reducing the weighted average cost of debt from 6.8 per cent to 5.2 per cent. Asset sales in the first half also fetched £382m - an 8 per cent premium to December 2014 book values - and included the freehold on Madame Tussauds and the New Hall Hospital in Salisbury.

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