LONDON (Alliance News) - Schroder Real Estate Investment Trust Ltd Monday said its unaudited net asset value was GBP238.9 million, or 50.7 pence per share, at the end of June, a 4.3% increased from the end of March.
In a first-quarter statement, the REIT said that the increase was driven by a 3.4% increase in the unrealised change in valuation of the direct property portfolio, prior to capital expenditure and acquisitions.
The REIT also reported earnings for the financial year ended March 31. The results showed a swing to a GBP20.9 million pretax profit, from a GBP10.8 million pretax loss a year earlier.
"We expect the sustained recovery in the UK economy to support continued growth in some commercial property values and demand from occupiers to lease properties. Whilst increasing demand for higher yielding assets is likely to result in further yield compression in parts of the market, future returns will be more influenced by rental value growth for well-located properties in strong commercial centres. The company's growth strategy will therefore continue to focus on property in supply-constrained locations offering strong underlying fundamentals," Chairman Lorraine Baldry said in Schroder REIT's year-end results statement.
"Increasing capital flows into UK commercial property also means the company is well placed to benefit from expediting the growth strategy in order to optimise the arbitrage between the company's cost of capital and property yields," Baldry added.
In January, Schroder REIT raised GBP17.2 million of new equity, followed by an additional GBP40.2 million through a further placing and offer for subscription in the first-quarter, which it is using to fund new deals.
Schroder REIT shares were Monday quoted up 1.3% at 52.40 pence.