Warehouse REIT Reports Resilient Results with Strong Rental Growth and Acquisitions

Strategic Insights -

Warehouse REIT, a specialist in multi-let warehousing, has announced a 2.0% increase in portfolio value to £810.2m, driven by growth in estimated rental values (ERV) of 7.7%. The company also reported a 5.1% like-for-like growth in contracted rents, with portfolio reversion increased to 13.1%. The company has diversified its portfolio with the acquisition of Ventura Retail Park, a 13-unit scheme in Tamworth, for £38.6m, which represents a net initial yield of 7.4%. This acquisition is a strategic move to expand its presence in the retail park sector, where it has "deep experience" and will benefit from its multi-let asset management expertise. The company has also completed 103 lease events during the year, with an average 28.6% uplift on previous rents.

Key Takeaways:

  • Warehouse REIT has reported a 2.0% increase in portfolio value to £810.2m, driven by growth in ERV of 7.7%.
  • The company has achieved a 5.1% like-for-like growth in contracted rents, with a portfolio reversion of 13.1%.
  • The acquisition of Ventura Retail Park, a 13-unit scheme in Tamworth, for £38.6m, represents a strategic expansion into the retail park sector.
  • The company has completed 103 lease events during the year, with an average 28.6% uplift on previous rents.
  • Warehouse REIT has sold £110.5m of assets during the year, bringing its disposal programme to £165m, which has supported an increase in dividend cover to 95%.
  • The company has refinanced its debt facilities, extending the term and improving covenants, with a new £320m facility comprising a £220m term loan and a £100m revolving credit facility (RCF).

Statistics:

  • Portfolio value: £810.2m (up 2.0% from previous year)
  • ERV growth: 7.7%
  • Like-for-like rental growth: 5.1%
  • Portfolio reversion: 13.1%
  • Number of lease events completed: 103
  • Average uplift on previous rents: 28.6%
  • Disposal programme completion: £165m
  • Dividend cover: 95%
  • Net debt: £320m
  • LTV ratio: 33.1% (up from 33.9% previous year)
  • Interest cover: 3.1 times

Sources:

  • Warehouse REIT press release, dated [not provided]
  • Warehouse REIT annual results to 31 March 2024
  • Neil Kirton, Chairman of Warehouse REIT, comments