Pacific Industrial & Log REIT PLC Trading Update (9449L)
October 07 2016 - 1:00AM
UK Regulatory
TIDMPILR
RNS Number : 9449L
Pacific Industrial & Log REIT PLC
07 October 2016
Pacific Industrial & Logistics REIT plc
("Pacific Industrial & Logistics", the "Company" or the
"Group")
Trading update
Pacific Industrial & Logistics REIT plc (AIM:PILR), a Real
Estate Investment Trust focused on sub GBP10m lot size industrial
and logistics properties, is pleased to issue a trading update
following the close of the first interim reporting period to 30
September 2016.
HIGHLIGHTS
-- Adjusted NAV* up 24% to 123.87p from issue price of 100p
-- GBP29.9m valuation, a 10.7% uplift on the Company's portfolio
since acquisition (on purchase price of GBP27m)
-- Pipeline of further suitable investment opportunities
identified with similar characteristics to the Company's initial
portfolio
-- Rent review and lease extension with one tenant has been
agreed with a 38% uplift in annual rent
-- The Company intends to embark on a capital raise by way of an equity placing shortly
Richard Moffitt, CEO of Pacific Industrial & Logistics,
commented:
"We are delighted to report that the Company has significantly
exceeded expectations in the interim period to 30 September 2016,
through upward-only rent reviews and active asset management in a
sector that continues to benefit from strong fundamentals post-EU
referendum".
PORTFOLIO UPDATE
The Company completed its successful IPO and acquisition of an
initial portfolio in April 2016. Working in conjunction with the
tenants of the initial portfolio, and in line with their strategy,
the Company's management team has carried out the following asset
management activities: (i) signed a rent review memorandum and
lease extension with one tenant in Bedford at a market leading
local rent of GBP6 psf., increasing the annual rent psf. by 38%;
(ii) introduced new lease terms on a leasehold property allowing
for the build out and use of the existing property as a retail
outlet; and (iii) signed a new long lease following a full
refurbishment by a tenant in Bedford.
Following the close of the initial interim period, the Board
commissioned an independent valuation report from CBRE. The Board
is pleased to report that the gross assets increased by 10.7% from
GBP27m at purchase to GBP29.9m delivering a return on investment of
c. 24% from a 100p issue price to 123.87p adjusted NAV per share.
Management believe there is further significant upside for the
portfolio.
The Board expects the interim results to be released in
November.
*NAV at 30 September 2016 is 122.18p. Adjusted NAV is 123.87p
(adding back the fair-value movement of an interest rate swap).
Diluted NAV (adjusting for warrants in issue) is 116.47p and
Adjusted Diluted NAV is 117.78p.
MARKET OUTLOOK
There has been considerable commentary in the press on the
commercial property sector as a whole. The sub sector that the
Company operates in, industrial and logistics, has shown little
change since the EU referendum in the view of the Directors, and
the Directors are aware of a number of transactions closing at
pre-referendum valuations.
The Directors believe that this sector remains less vulnerable
than other real estate sectors as consumers continue to migrate
online and demand for logistics remains high. With growing demand
from consumers who continue to rely on e-commerce, companies have
to adapt their strategies. Supply in key locations across the
Midlands, and other regional locations, remains constrained and
development opportunities are limited.
The Directors have identified a strong pipeline of attractive
assets that are complementary to the Company's existing portfolio
and located in logistical locations. The Board believes these
assets present the Company with a good opportunity to grow its
portfolio in the coming months, subject to the necessary
financing.
For further information regarding Pacific Industrial &
Logistics REIT plc please call:
Pacific Industrial & Logistics
REIT Plc
Richard Moffitt +44 (0) 207 591
CEO 1600
finnCap - Nominated Adviser
and Broker
Stuart Andrews/ Grant Bergman/ +44 (0)20 7220
Giles Rolls 0500
Corporate Finance
Christian Hobart
Corporate Broking
Radnor Capital Partners -
Capital Advisory +44 (0)20 7073
Tom Durie / Joshua Cryer 7860
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014
This information is provided by RNS
The company news service from the London Stock Exchange
END
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