The defensive qualities of Aim-listed student accommodation real-estate investment trust (REIT) Empiric Student Property (ESP) served shareholders well following the EU referendum with its shares' fall limited to 10 per cent in the two days after the vote, compared with a 22 per cent decline by the FTSE All-Share REIT sector.
The nature of Empiric's investments is what allows it to keep its head close to the water while others sink and it sought to further reassure the market about its prospects with a post-Brexit trading update. A 2.75 per cent annual rental uplift is being implemented in September 2016 and 65 of its 75 assets across the country should be operational by the beginning of the next academic year, leading to a gross annual rent roll of approximately £49m.
Empiric addressed fears that stricter visa requirements and higher fees could discourage overseas students following Brexit, by pointing out that only 6 per cent of UK full-time students currently come from the EU and the devaluation of the sterling may make UK institutions more attractive.
