TIDMPRSR
RNS Number : 4123F
PRS REIT PLC (The)
10 July 2023
PRSR.L
The PRS REIT plc
("the Company" or "the PRS REIT")
Debt Refinancing and Trading Update
The PRS REIT, the closed-ended real estate investment trust that
invests in high-quality, new build family homes in the private
rented sector ("PRS"), is pleased to announce that it has completed
the refinancing of its GBP150 million revolving credit facility
("RCF") provided by The Royal Bank of Scotland plc ("RBS") and
Lloyds Banking Group plc. The RCF had been originally due to mature
in February 2023 and was extended on substantially the same terms
to mid-July 2023 (with an option to extend until October 2023). The
Board views the refinancing as having been completed on attractive
commercial terms in light of the current interest rate
environment.
The Investment Manager has secured a GBP102 million facility of
fixed-rate debt for 15 years, together with a further GBP75 million
of floating-rate debt agreed for two years, providing the Company
with the flexibility to refinance this element over that period. An
interest rate cap will be put in place on the floating rate debt to
hedge against downside risk on further interest rate movements.
These new facilities have been established with Legal and General
Investment Management and RBS respectively.
The Investment Manager will immediately deploy almost two-thirds
(GBP115 million) of the total debt, specifically the entire GBP102
million fixed-rate facility and GBP13 million of the floating-rate
facility, to fund already completed and stabilised sites. The
balance of GBP62 million of floating-rate debt is expected to be
drawn down to fund sites completing and stabilising before calendar
year 2024.
The refinancing and a near to completed construction programme,
alongside excellent fundamental performance in letting,
affordability, occupational levels and rental growth have
substantially reduced the risks facing the portfolio, reinforcing
its strong position as a market leader in the build-to-rent
sector.
Resultant total debt facilities
-- The PRS REIT now has total fixed long-term debt facilities of
GBP352 million, with an average blended interest rate of 3.8%. This
compares favourably with the average net initial valuation yield of
4.3% as at 31 December 2022.
-- Approximately 82% of the Company's overall debt is now
covered by long-term facilities, which have an average term of 16
years. This compared to 63% of overall debt previously covered by
long term facilities, with an average term of 17 years.
-- The two new facilities significantly lengthen the maturity of
the Company's overall debt facilities.
o The average term for all debt has increased to 13.7 years at
30 June 2023, from 10.9 years at 31 December 2022.
Portfolio performance
The Company's portfolio of completed rental homes continues to
perform well, in line with management expectations. Performance
data as at 31 May 2023, shows:
-- occupancy at 97%, and at 98% including applicants who had
passed referencing and paid rental deposits;
-- rent collection* at 100% for the 11 months ended 31 May 2023;
-- total arrears modest at c.GBP0.6m; and
-- like-for-like rental growth over the 12 months ended 31 May
2023 averaged 6.5%, an increase on rental growth of 5.7% over the
12 months ended 31 March 2023.
Affordability remains strong, with average rent as a proportion
of household income at c.25%. This is comfortably within Home
England's 35% target.
The Company expects to provide an update on trading in the
fourth quarter of its financial year in late July.
*Rent collection is defined as rent collected in the period
relative to rent invoiced in the same period.
For further information, please contact:
The PRS REIT plc Tel: 020 3178 6378
Steve Smith, Non-executive Chairman (c/o KTZ Communications)
Sigma PRS Management Ltd Tel: 0333 999 9926
Graham Barnet, Mike McGill
Singer Capital Markets Tel: 020 7496 3000
James Maxwell, Asha Chotai (Investment
Banking)
Alan Geeves, James Waterlow, Sam Greatrex
(Sales)
Panmure Gordon (UK) Limited Tel: 020 7886 2500
Alex Collins (Investment Banking)
Tom Scrivens (Corporate Broking)
G10 Capital Limited (part of IQ-EQ) Tel: 0207 397 5450
Paul Cowland
KTZ Communications Tel: 020 3178 6378
Katie Tzouliadis, Robert Morton
NOTES TO EDITORS
About The PRS REIT plc
www.theprsreit.com
The PRS REIT plc is a closed-ended real estate investment trust
established to invest in the Private Rented Sector ("PRS") and to
provide shareholders with an attractive level of income together
with the potential for capital and income growth. The Company has
investment of over GBP1bn in a portfolio of high-quality homes for
private rental across the regions, having raised a total of
GBP0.56bn (gross) through its Initial Public Offering, on 31 May
2017 and subsequent fundraisings in February 2018 and September
2021. The UK Government's Homes England has supported the Company
with direct investments. On 2 March 2021, the Company transferred
its entire issued share capital to the premium listing segment of
the Official List of the FCA and to the London Stock Exchange's
premium segment of the Main Market. Now comprising over 5,000
build-to-rent homes, the Company believes its portfolio is the
largest build-to-rent single-family rental portfolio in the UK.
LEI: 21380037Q91HU97WZX58
About Sigma Capital Group Limited (formerly Sigma Capital Group
plc)
www.sigmacapital.co.uk
Sigma Capital Group Limited ("Sigma") is a PRS, residential
development, and urban regeneration specialist, with offices in
Edinburgh, Manchester and London. Sigma's principal focus is on the
delivery of large-scale housing schemes for the private rented
sector. The Company has a well-established track record in
assisting with property related regeneration projects in the public
sector, acting as a bridge between the public and private
sectors.
Sigma has created an excellent property procurement and
management platform, which sources sites and brings together
construction resource to develop them, enabling Sigma to deliver an
integrated solution to partners. As well as sourcing sites and
managing all stages of the planning and development process, Sigma
manages the rental of completed homes through its award-winning
rental brand 'Simple Life'. The Company's subsidiary, Sigma PRS
Management Ltd, is Investment Adviser to The PRS REIT plc.
About Sigma PRS Management Ltd
Sigma PRS Management Ltd is a wholly-owned subsidiary of Sigma
Capital Group Limited and is Investment Adviser to The PRS REIT
plc. It sources investments and operationally manages the assets of
The PRS REIT plc and advises the Alternative Investment Fund
Manager ("AIFM") and The PRS REIT plc on a day-to-day basis in
accordance with The PRS REIT plc's Investment Policy. The AIFM is
G10 Capital Limited. Sigma PRS Management Ltd is an appointed
representative of G10 Capital Limited, which is authorised and
regulated by the Financial Conduct Authority (FRN:648953).
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