Update on NAV and current trading
PRSR.L
THIS ANNOUNCEMENT HAS BEEN DETERMINED TO CONTAIN INSIDE INFORMATION. THE PUBLICATION OF THIS ANNOUNCEMENT MEANS THAT THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
The PRS REIT plc
("the Company" or "the PRS REIT")
Update on Net Asset Value and Current Trading
The PRS REIT, the closed-ended real estate investment trust that invests in high-quality, new build, single family homes for the private rented sector ("PRS"), is pleased to provide an update on its net asset value ("NAV") for the year ended 30 June 2022 and on its activity and performance for the first two months of the new financial year ending 30 June 2023.
Net asset value
As at 30 June 2022, the PRS REIT's unaudited NAV on an IFRS basis, is expected to be not less than 116.0 pence per ordinary share (31 December 2021: 104.3 pence (unaudited) and 30 June 2021: 99.0 pence (audited)), representing an increase of 11% and 17% over the six-month and 12-month periods respectively. The EPRA NTA per share (previously EPRA NAV per share) is expected to be the same as NAV on an IFRS basis.
Current trading
Portfolio expansion and asset performance
|
|
At 31 August 2022 |
At 30 Jun 2022 |
At 31 Mar 2022 |
|
Number of completed homes |
4,841 |
4,786 |
4,616 |
|
Current anticipated rent per annum* |
£49.1m |
£47.8m |
£45.5m |
|
Number of contracted homes |
669 |
693 |
822 |
|
Estimated rental value ("ERV") per annum |
£3.7m |
£4.4m |
£6.2m |
|
Completed and contracted sites |
70 |
68 |
67 |
|
Current anticipated rent of completed and ERV of contracted sites* |
£52.8m |
£52.2m |
£51.7m |
|
|
2 months July and Aug 2022 |
Year to 30 Jun 2022 |
9 months to 31 Mar 2022 |
|
Rent collected in period relative to rent invoiced for same period |
99 % |
99% |
99% |
*based on all completed units being occupied/income producing
Construction activity continued to progress well, with 55 new homes added to the portfolio since 30 June 2022, the end of the last financial year. This has taken the total portfolio to 4,841 completed homes with an estimated rental value ("ERV") per annum of £49.1m as at 31 August 2022. A further 669 homes were contracted at that point and are at varying stages of the construction process.
Of the 4,841 completed homes, 4,745 (98%) were occupied as at 31 August 2022, with a further 40 homes reserved for qualified applicants with rental deposits paid. Rental demand remains high, supported by a strong rental market and the attraction of the PRS REIT's high-quality, well located and managed homes. Rent collection was 99% in the two-month period. (This is rent collected as a percentage of rent invoiced in the period). Total arrears remain very low, at £0.6m on 31 August 2022.
Rental growth
The previously reported 5.1% like-for-like average rental growth over the year on stabilised sites reflected blended growth rates across both existing tenant renewals and re-lets to new tenants. Rental growth on lettings to new tenants at c.10% has been significantly higher than the average rental growth of 5.1% across the portfolio of stabilised assets. This has contributed to an increased ERV across the entire portfolio, with overall ERV in excess of aggregate current anticipated rent, and also accounts for the significant majority of the valuation uplift over the period. A smaller but additional portion of valuation uplift is attributable to the continued tightening of net yield from 4.2% at 31 December 2021 (30 June 2021: 4.25%) to 4.125% at 30 June 2022; a result of the reversionary nature of the rents and strong demand for PRS assets in the market.
Energy performance
All the Company's homes are built to be energy efficient, and approximately 86% of homes in the portfolio are rated 'A' or 'B' in terms of energy performance certification, with the remainder rated 'C'. As well as being environmentally desirable, this puts all homes in compliance with proposed new regulation requiring all rental homes to possess an energy performance certificate ("EPC") of 'C' or above from 2025.
Dividend
The Company declared dividends totalling 4.0 pence per share for the year ended 30 June 2022, and the annual dividend is now almost fully covered by earnings on an annualised run rate basis, with coverage continuing to grow during the financial year ending 30 June 2023 as construction, completions and lettings advance.
Audited full year results
The Company expects to publish its audited full year results on 11 October 2022.
For further information, please contact:
|
The PRS REIT plc
|
Tel: 020 3178 6378 (c/o KTZ Communications) |
|
Sigma PRS Management Limited
|
Tel: 0333 999 9926 |
|
Singer Capital Markets
|
Tel: 020 7496 3000
|
|
Panmure Gordon (UK) Limited Chloe Ponsonby, Alex Collins
|
Tel: 020 7886 2500 |
|
G10 Capital Limited (part of the IQEQ Group as AIFM) Paul Cowland
|
Tel: 020 3745 2826 |
|
KTZ Communications Katie Tzouliadis, Dan Mahoney |
Tel: 020 3178 6378 |
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 is investing over £1bn in a portfolio of high-quality homes for private rental across the regions, having raised a total of £0.56bn (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. At over 4,800 new rental 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, and is part of PineBridge Investments, a private, global asset manager with $146bn in assets under management at March 2022.
Sigma's principal focus is on the delivery of large-scale housing schemes for the private rented sector. The business 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 unrivalled property 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 also manages the rental of completed homes through its award-winning rental brand 'Simple Life'. The business's subsidiary, Sigma PRS Management Limited, is Investment Adviser to The PRS REIT plc.
About Sigma PRS Management Limited
Sigma PRS Management Limited 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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