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Creating a virtuous Circle for enhancing shareholder value

A well-managed regional office property company is selling down its portfolio and plans to return cash to shareholders.
February 24, 2022
  • £34.5mn disposal of Kents Hill Park Conference Centre to subsidiary of LXI REIT scheduled to complete on 25 March 2022, subject to shareholder approval
  • £20mn sale of One Castle Park, Bristol completed at 3.9 per cent premium to book value
  • Contracts exchanged for disposal of 51 per cent interest in 141 Moorgate, London for £3.6mn, a 26 per cent premium to carrying value

Circle Property (CRC:225p), an internally managed Jersey-registered property company, has announced £58.1mn of disposals from its £130m portfolio of well-located regional office properties since mid-December 2021. Importantly, all the sales have been made at premiums to book value.

The board plans to continue selling down the portfolio over the next two to three years – and are incentivised to do so far sooner – with a view to returning the cash to shareholders. The first of two minimum capital returns will be made either through tender offers or share buy-backs within 12 months of the completion of the sale of its flagship asset, Kents Hill Park Conference Centre, Milton Keynes. The 159,872 sq ft property is fully let to Compass Group on an unexpired 19.5-year lease term. The £34.5mn sale price equates to three times the price Circle paid for the asset in December 2013.

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