Custodian REIT PLC Intention to issue equity (9417C)
23 1월 2015 - 4:01PM
UK Regulatory
TIDMCREI
RNS Number : 9417C
Custodian REIT PLC
23 January 2015
23 January 2015
Custodian REIT plc
("Custodian REIT" or "the Company")
Intention to issue equity
Following the Company's admission to the Official List on 26
March 2014 ("IPO") and further equity issue on 8 October 2014, the
Board today announces that in light of the level of cash deployed
since IPO and the pipeline of current investment opportunities, it
is making available additional new ordinary shares ("New Shares")
under the Placing Programme established in the Company's February
2014 prospectus ("the Issue"). The Board intends to raise
approximately GBP20 million (before costs and expenses) but
reserves the right to increase the issue size in light of
demand.
The company has contractually committed to deploy cash of GBP2.5
million on a pre-let development funding and has GBP6.5 million of
properties under offer, which subject to satisfactory acquisition
due diligence are expected to complete within the next two weeks.
These acquisitions, which would be funded from debt, will increase
loan to value to 18.2% (GBP35 million), compared to the target
gearing of 25.0% loan to value, leaving limited headroom for
further investment. However, the Board believes there is a
significant opportunity, in the context of market developments
explained below, to acquire further assets that can increase
diversification in the portfolio and enhance income yield.
The Company's target dividend is 5.25 pence per share in the
year ending 31 March 2015 and 6.25 pence per share in subsequent
years. Since IPO the Company has invested GBP87.5 million at an
average net initial yield of 7.5%, which has supported the
Company's ability to fully cover the target dividend. This has been
achieved without compromising the quality of property, location,
tenant or unexpired lease term despite yield compression in the
broader market and consequent price inflation.
The principal focus of investor demand from institutional or
open-ended funds, public property companies and overseas investors
has been for lot sizes greater than GBP10 million, leading to
strong competition for these larger assets. Many of these investors
have been simultaneously selling their smaller properties creating
a strong pipeline of high quality assets that fit Custodian REIT's
investment strategy. The Company has targeted these high quality,
regional property assets of lot size below GBP7.5 million and has
benefitted from a significant net initial yield advantage
accordingly. The Board believes these market dynamics will continue
through the first half of 2015 and that the property market is at
the beginning of a phase of rental growth, which will enhance
future income returns and support capital value growth over the
long-term.
This placing will therefore support the investment strategy and
allow the Company to maximise the current market opportunity.
The Issue will be made to Qualified Investors (as defined in
section 86(7) of the Financial Services and Markets Act 2000 (as
amended)) through Numis Securities Limited ("Numis"), and
application made for the admission of the New Shares to the premium
segment of the Official List of the UK Listing Authority and to
trading on the London Stock Exchange plc's main market for listed
securities.
The Issue is expected to close at 12.00 p.m. (London time) on 12
February 2015, with admission on 17 February 2015, but may close
earlier or later at the absolute discretion of the Company and
Numis. The issue price per New Share will be 104 pence which is a
premium of 5% to the net asset value ("NAV") per share at 31
December 2014, having deducted the proposed third quarter dividend
of 1.25p which is payable to shareholders on the register at the
close of business on 6 February 2015.
Qualified Investors are invited to apply for New Shares by
contacting Numis on the contact details below. The decision to
allot New Shares to any Qualified Investor and the actual issue
size shall be at the absolute discretion of the Company and
Numis.
The Board and the Fund Manager believe the Issue is in
Shareholders' interests as it will increase the Company's NAV and
offer the opportunity to further diversify its portfolio, with the
proceeds expected to be invested on a timely basis consistent with
the Company's published objectives.
- Ends -
For further information, please contact:
Custodian Capital Limited
Richard Shepherd-Cross / Nathan Tel: +44 (0)116
Imlach / Ian Mattioli 240 8740
www.custodiancapital.com
Numis Securities Limited
Nathan Brown / Hugh Jonathan Tel: +44 (0)20
7260 1000
www.numiscorp.com
Camarco
Ed Gascoigne-Pees Tel: +44 (0)20
3757 4984
www.camarco.co.uk
Notes to Editors
Custodian REIT plc is a UK real estate investment trust ("REIT")
listed on the London Stock Exchange. The Company launched on 26
March 2014, acquiring a portfolio of GBP95 million of UK commercial
property. This was sourced from an existing portfolio of 48
properties held by clients of Mattioli Woods plc in a syndicated
structure. The diverse portfolio consisted of properties let to
institutional grade tenants on long leases throughout the UK.
The Company raised gross proceeds of GBP55 million through an
initial public offering and raised a further GBP25 million via a
subsequent placing. It invests in a diversified portfolio of UK
commercial properties to achieve its investment objective of
providing shareholders with an attractive level of income together
with the potential for capital growth through a closed-ended fund.
Since IPO the Company has invested total funds of GBP87.5 million
in acquiring a further 34 UK commercial properties.
The target portfolio is characterised by small lot sizes with
individual property values of less than GBP7.5 million at
acquisition. Custodian Capital Limited is the discretionary
investment manager of the Company.
For more information visit www.custodianreit.com and
www.custodiancapital.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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