UK industrial property REIT Segro has 20 developments under way or contracted as part of its strategy of reshaping its European portfolio.
UK industrial property REIT Segro has 20 developments under way or contracted as part of its strategy of reshaping its European portfolio.
Announcing its 2011 results, Segro said the new developments would generate rental income of £18.9 mln (EUR 22.6 mln), and an average expected development yield of 9.5%. The company completed 14 developments during 2011, generating £9 mln of annualised rental income.
However, Segro's share price dropped yesterday to 228 pence before recovering to 232 pence as the company announced a H2 2011 non-core portfolio valuation decline of £187 mln, compared to the £150 mln of writedowns predicted by CEO David Sleath in November. EPRA net asset value per share for 2011 dropped 9.6% to 340 pence.
The EPRA pre-tax profit was up 8.8% to £127 mln.
Segro carried out £111 mln of disposals of non-core assets in 2011, followed by the sale of five non-core UK industrial estates to Ignis Asset Management for £80.2 mln so far this year. Further disposals are expected during 2012. The UK REIT is also acquiring assets. The planned expansion of the logistics portfolio commenced with the £314.7 mln acquisition of the UK Logistics Fund in January 2012 in a 50/50 joint venture with Moorfield.
'As part of the revised strategy for the Group outlined on 8 November 2011, we have made a promising start to reshaping our portfolio with the completion since the year end of the acquisition of prime logistics assets with a joint venture partner and the disposal of a portfolio of non-core holdings in the UK,' Sleath said.
