- IPO proceeds deployed ahead of schedule
- Dividend of 5.5p a share targeted for the year to August 2022
Home Reit (HOME) has ploughed the £240m raised in October's IPO into accommodation for those that would otherwise be homeless, ahead of schedule. It is not just the social impact credentials that may appeal to investors.
The net asset value (NAV) of the portfolio rose almost 5 per cent since the IPO, a reflection of the relative security associated with 25-year leases and investment manager Alvarium’s ability to source all deals off-market.
Rent collection rates have remained at 100 per cent throughout the pandemic, as the Reit’s charity tenants are reimbursed by local government and, ultimately, central government.
The Reit paid a first half-year dividend of 0.83p a share in March, and is on track to pay a minimum total of 2.5p for the financial period from IPO until 31 August and a 5.5p dividend for the 2022 financial year. The shares might be trading at a premium to NAV or more than a tenth, but those income prospects look attractive. Buy.
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