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Hansteen plans £580m capital return

The industrial property investment group also acquired a portfolio of multi-let properties
August 23, 2017

Hansteen's (HSTN) management is a step closer to boosting shareholder income. After completing the €1.28bn (£1.18bn) sale of its German and Dutch portfolio in June, management has announced plans to return £580m to shareholders before the year’s out. The preferred method at present is via a share buyback, says co-chief executive Ian Watson.

IC TIP: Buy at 129.9p

The imbalance between supply and demand for industrial property in the regions continued to benefit Hansteen during the first six months of the year. Estimated rental values increased by 2.1 per cent on average across the portfolio, with the average rent £3.66 per sq ft compared with £3.41 sq ft over 2016. A rise in e-commerce has also helped, with around 30 per cent of its estate occupied for online delivery storage. Overall rental income from its continuing operations more than trebled to £29m.

Management is hoping to add to this via its acquisition of Industrial Multi Property Trust, which owns similar properties to Hansteen. The portfolio consists of 51 multi-let properties, offering 500 leasable units with a total floor of around 1.7m sq ft. Around 86 per cent is invested in light industrial property.   

Analysts at Numis expect adjusted net assets of 137p a share at 31 December 2017, up from 129p the same time in 2016.

HANSTEEN HOLDINGS (HSTN)  
ORD PRICE:129.9pMARKET VALUE:£1.07bn
TOUCH:129.8-129.9p12-MONTH HIGH:131pLOW: 104p
DIVIDEND YIELD:4.6%TRADING PROPERTIES:£10m
DISCOUNT TO NAV:2%NET DEBT:32%
INVESTMENT PROPERTIES:£795m  
Half-year to 30 JunNet asset value (p)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
201611624.83.42.2
201713312.61.72.3
% change+14-49-50+5
Ex-div: 28 Sep   
Payment: 27 Oct