Solid results from GCP Student Living

GCP Student to pay dividend despite reduced revenues

Solid results from GCP Student Living – Scape Bloomsbury ready for business – GCP Student Living has published its annual report, covering the year that ended on 30 June 2018. Highlights are:

  • EPRA NAV (cum-income) per ordinary share of 149.12 pence and EPRA NAV (ex-income) per ordinary share of 147.61 pence at 30 June 2018 – up from 139.08p at the end of June 2017.
  • Share price rose to 147p from 145p
  • Dividends of 5.95p – up 3.4%.
  • Value of the property portfolio rose to £784.4m from £634.6m – boosted by fundraise (see below).
  • Like-for-like valuation uplift over the year of 7.3%
  • Annualised shareholder return since IPO of 12.5%, in excess of the company’s target return of 8–10%.
  • Total rental income for the year of £35.8 million.
  • Net operating margin stable at 78%.
  • Successful equity raise of £70 million through a substantially oversubscribed placing of ordinary shares.
  • First forward-funded development at Scape Wembley, London, completed on schedule for the 2017/18 academic year, generating a material valuation uplift of c.£12 million at completion and providing a further c.580 modern beds.
  • Second forward-funded development asset, Circus Street, Brighton, commenced construction, which is expected to provide 450 beds on completion ahead of the 2019/20 academic year.
  • Acquisition of Podium, which offers 178 beds in the same locality as the company’s ‘The Pad’ asset, together providing c.400 beds adjacent to RHUL.
  • High-quality portfolio of ten assets with c.3,600 beds located primarily in and around London, with a valuation of £784.4 million at 30 June 2018.
  • Portfolio fully occupied and student rental growth of 4.1% for the 2017/18 academic year.
  • Completion of the refurbishment of Scape Bloomsbury in time for the 2018/19 academic year, providing 432 beds.
  • Post year end, completion of a redrawable credit facility of £45 million with Wells Fargo & Company and entry into a forward-funding agreement to fund Scape Brighton.

Robert Peto, DIGS’ chairman, commented: “Recent market transactional activity provides further evidence of the attraction of London for investors in private student residential assets, with yields continuing to tighten, driven by investor demand and restrictive planning. In this respect the company’s ability to deliver its own pipeline through future contractual arrangements has been a key factor in its success since IPO. The company’s current assets under development or refurbishment are well placed to provide potential rental and earnings growth, in addition to NAV growth prospects, over the short to medium term. In particular, the Board is pleased to note that the refurbishment of Scape Bloomsbury, located in the heart of London WC1, will be complete in time for the 2018/19 academic year.”

DIGS : Solid results from GCP Student Living

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