Civitas Social Housing Reit (CSH) has declared a fourth quarter dividend in respect of the last financial year and raised its dividend target for 2021, after collecting almost all rent due by the end of March.
The group, which provides social housing for those with complex care needs, intends to pay a fourth quarter dividend of 1.325p a share and has met its target of fully covering the dividend by EPRA earnings on a run-rate basis. Management has also set a goal of paying dividends totalling 5.4p for the 2021 financial year.
The group has received more than 99 per cent of rent due by the end of March and the annual rent roll increased by 2.5 per cent to £48.4m over the quarter. The net initial yield attached to the portfolio also compressed to 5.26 per cent, from 5.29 per cent, although that valuation is subject to the material uncertainty clause being applied by valuers following the pandemic outbreak.
Civitas signs leases with housing associations, which are appointed by a care provider to service the plan put in place for its tenant. Rent is ultimately funded from central government’s welfare budget.
Concerns around potential financial strain on care providers have risen because of the impact Covid-19 has had on care homes and the elderly. Yet catering to younger tenants, which have an average age of 32 and generally do not suffer from the type of underlying health conditions that would fall under the NHS definition of those at high risk, should limit the impact on the care providers Civitas deals with.
“In that whole marketplace there have been very, very few instances to date of Covid-19, thankfully,” said Civitas director Andrew Dawber.
Among a tenant base of almost 4,500, there have been just 10 confirmed cases of Covid-19 within Civitas’ facilities.
The group has also made available a number of units to house homeless people, following the government’s advice that local authorities get as many individuals as possible off the street in the wake of the pandemic.
