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Standard Life Investments Property Income reports flat quarter

Standard Life Investments Property Income buys in Birmingham Swadlingcote

Standard Life Investments Property Income reports flat quarter – The NAV at the end of September 2020 was 78.8p, 1% down on the level at the end of June. This was offset by dividends declared and so the NAV return for the quarter was fairly flat at -0.1%. The quarterly dividend was maintained at 0.714p, 60% of the pre COVID level.

Rent collection

For Q2 2020 – 90%, Q3 – 84% and Q4 – 70% of rents have been collected. There is another 13% is expected to come in through monthly payments and late payments from tenants. The manager thinks the fund will end up collecting around 90% of the income in each corner.

The B&Q retail warehouse that they bought in Halesowen (for £19.5m) came with a yield of 7.5% and an 11-year lease. As a backstop, the manager thinks that the site could suit an urban logistics function.

The LTV at the end of the quarter was 29.4% – here the manager is prepared to see that rise to about the mid-30s level.

Some of the borrowing facilities will be applied to buying back shares in the company. The shares currently trade on a 33.3% discount – the same as saying that they could rise by 50% and still be trading at asset value.

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