Net Asset Value(s) and Divide

RNS Number : 2258K

ING UK Real Estate Income Trust Ltd

15 April 2010

 



ING UK Real Estate Income Trust Limited

15 April 2010

ING UK Real Estate Income Trust Limited (IRET) - Net Asset Value as at 31 March 2010 and Interim Dividend

The unaudited Net Asset Value ('NAV') per share of ING UK Real Estate Income Trust Limited (the "Company") as at 31 March 2010 was GBP 186.3m, reflecting approximately 56 pence per share. 

The Company also announces an interim dividend of 1 pence per share in respect of the period 1 January 2010 to 31 March 2010.  The dividend payment will be made on 28 May 2010 to shareholders on the register on 7 May 2010.  The ex-dividend date will be 5 May 2010.

The NAV attributable to the Ordinary Shares is calculated under International Financial Reporting Standards ('IFRS') and reflects an increase of of 2.9% compared to the previous quarter or approximately 1 pence per share.  At an underlying property level there has been a GBP 7.2m increase in the property portfolio valuation, representing a 2.1% increase over the period. It also includes a downwards adjustment in respect of the mark to market value of the interest rate swaps of GBP 3.0m. 

This NAV figure incorporates the external portfolio valuation as at 31 March 2010.  It includes income for the current quarter and is calculated after the deduction of dividends paid prior to 31 March 2010, but it does not include provision for the next quarterly dividend which is expected to be paid in May 2010.

The unaudited NAV is as follows:

	31 Mar 2010 £m	31 Dec 2009 £m	30 Sept 2009 £m	30 Jun 2009 £m
Investment properties	351.7	352.5	333.4	357.3
Other assets*	49.9	59.4	45.1	56.7
Other liabilities	(15.8)	(15.2)	(15.3)	(15.8)
Borrowings*	(185.9)	(204.0)	(190.0)	(225.0)
Market value of interest rate swaps	(13.6)	(11.6)	(12.4)	(11.2)
Net Asset Value	186.3	181.1	160.8	162.0

The movements in the NAV can be summarised as follows;

	Total	Per share	movement
	£m	pence	%
NAV at 31 December 2009	181.1	55
Gains in property values (realised and unrealised )	7.2	2	4
Movement in swap value	(3.0)	(1)	(2)
Gains on loan note repurchase	0.7	-
Net income for the period  (after distributions)	0.3	-	-
NAV at 31 March 2010	186.3	56	2

*This includes the liquidity facility of GBP 10.9m which is a requirement of the securitised loan.

An external valuer will next value the property portfolio during June 2010 and the NAV per share as at 30 June 2010 will be issued in July 2010.

Investment Manager Commentary

The IPD Monthly Index recorded positive capital growth in January and February of 1.0% and 1.3% respectively, albeit the rate of increase was substantially lower than the preceding 3 months. The rate of rental value declines in each sector also slowed markedly over January and February, compared with the end of 2009, albeit it is yet to reach an inflexion point.

The underlying movements in the property valuation and the current sector weightings are set out in more detail below:

Sector	Capital Valuation Movement	Weighting 31 March 2010
Retail	1.2%	13.9%
Offices - Central/Greater London	4.2%	13.9%
Offices - Rest of UK	1.3%	25.4%
Industrial	2.4%	33.1%
Leisure	0%	5.1%
Retail Warehouse	2.7%	8.6%
Total	2.1%	100.0%

As at 31 March 2010, the portfolio had a net initial yield of 7.40% and a net reversionary yield of 8.25%. The occupancy rate was approximately 93% and the average lease length was 8.1 years.

Notable transactions over the quarter included a new letting at Northampton Business Park to Ricoh at a rent of GBP 350,000 pa; the payment of over GBP 4 million by Merrill Lynch to surrender their lease at Lincoln Place, Farringdon; and the disposal of 171 Bath Road, Slough for a total consideration of GBP 8.91 million, reflecting a 19% premium to the December 2009 valuation.

Additionally, at the end of January the Company repaid GBP 15 million of its securitised debt at a 5% discount to the nominal value, enhancing both the underlying NAV and income accounts. The Company has a current outstanding loan balance of GBP 175 million.

The Company remains compliant with its principal banking covenants, with a current LTV for its securitised pool of 46.5% and an Interest Cover Ratio of 2.68 as at the Q1 2010 test date.  The Company continues to have operational funds outside the securitised pool.

Other Announcements

In addition to this NAV announcement, the Company has also announced today its full year results for the year to 31 December 2009 and the details of a recommended offer for Rugby REIT plc.  Please see the separate announcements for full details.

There will be an analyst meeting this morning at 0830 at the offices of J.P. Morgan Cazenove, 20 Moorgate, London, EC2R 6DA. There will also be a live conference call facility. Please contact Financial Dynamics for full details. A copy of the presentation will be made available on the Company's website www.ingreit.co.uk.

For further information:

All Enquiries

David Sauvarin

The Company Secretary

Northern Trust International Fund Administration Services (Guernsey) Limited

Trafalgar Court

Les Banques

St Peter Port

Guernsey

GY1 3QL

Tel:      [phone]

Fax:     [phone]

ING Real Estate Investment Management (UK) Limited

Helen Stott, 020 7767 5648 [e-mail]

Financial Dynamics

Dido Laurimore, 020 7831 3113, [e-mail] 

Laurence Jones, 020 7831 3113, [e-mail]

 

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