Despite challenging trading conditions, a strong asset management performance delivered robust operational results across the majority of the RDI REIT’s portfolio and their management team has made notable progress towards achieving key strategic objectives, including a reduction in retail portfolio exposure (following a substantial sale in Germany) and strengthening the balance sheet, to deliver a more streamlined, simplified investment proposition with a lower leverage capital structure:
- Balance sheet strengthened with proforma leverage reduced to 42%.
- Retail exposure reduced by circa 15% to 30%.
- 131 leasing events completed during the year at 4.7% above ERV.
- Further positive letting transactions post year end have increased portfolio occupancy to 97.2%.
- Resilient performance from Hotels and London Serviced Office operational platforms.
- Exposure to the distribution and industrial sector further enhanced through £52.3 million of acquisitions during the year.
Chairman, Gavin Tipper commented:
“A significant amount of work has been undertaken over the past twelve months, and particularly since we set out our intentions at the half-year to further reduce leverage and accelerate the reweighting of the portfolio through the disposal of certain retail assets. I am pleased to report that important steps have been taken towards reaching these goals, with our retail holdings as the date of this report having been reduced by approximately 15 per cent, and that, despite the difficult market backdrop, operational results across the business remain robust, reflecting the portfolio’s increasing exposure towards growth sub sectors and stronger economic locations.”
Chief Executive, Mike Watters commented:
“While it has been a challenging year, we are proactively taking every step available to quicken the delivery of our strategic objectives so that the business is well-positioned as we move towards 2020. Operationally, our asset management team continues to produce a good performance, with over 130 leases completed in the period at 4.7 per cent above ERV, and the disposal programme is well underway, including the sale of the Bahnhof Altona Centre in Hamburg at an almost ten per cent premium. Once that is concluded we will have a more streamlined, structurally resilient portfolio that is well-positioned for the long term.”