Schroder’s property portfolio remains prudently geared for 2021

Schroder European REIT's Boulogne-Billancourt office asset in Paris.
Boulogne-Billancourt in Paris.

Schroder European Real Estate Investment Trust has provided an update on rent collection, alongside a quarterly independent valuation of the company’s property portfolio as of the 31st of December 2020.

Approximately 89% of rent due for the quarter ending on the 31st of December 2020 has been collected which is ahead of the amount collected in the previous two quarters of 87%. As of the closed quarter, the property portfolio was independently valued at €276.1 million, an increase of 2.8% or €7.51 million, on the 30th of September 2020 valuation of €268.6 million. Net of the €4.6 million capital expenditure invested in the refurbishment of Boulogne Billancourt over the quarter, the valuation increase is €2.91 million or 1.4%.

Excluding the Boulogne-Billancourt capital investment, the like-for-like valuation increase during the quarter was driven by numerous asset management initiatives which included:

  • Two new lease agreements for five and six years respectively for a further floor and part floor of its Hamburg office investment, representing c.10% of the lettable area. This resulted in a valuation increase of €1.2 million or 6.5%.
  • Yield compression and ERV growth across numerous industrial assets in the portfolio resulted in a valuation increase of €1.41 million or 3.0%.
  • The value of Schroder European Real Estate Investment Trust’s 50% interest in the Seville shopping centre declined marginally by €50 000 or 0.2%. The opening of the recently expanded and refurbished Mercadona supermarket has assisted in limiting the decline. This asset is the only asset in the portfolio where the valuers continue to adopt a material uncertainty clause.

The company remains prudently geared within a loan-to-value (LTV), net of cash, of approximately 25% as of the 31st of December 2020 with no debt maturity before 2023.

The 31st of December 2020 unaudited NAV and dividend will be announced in early March 2021.