August 2024
- 07 August 2024
- QuotedData
August 2024
Winners and losers in July 2024
| Best performing funds in price terms | % |
|---|---|
| Tritax EuroBox | 13.3 |
| Balanced Commercial Property Trust | 10.5 |
| TR Property | 10.4 |
| AEW UK REIT | 9.9 |
| Shaftesbury Capital | 9.9 |
| Picton Property | 9.4 |
| Schroder REIT | 9.1 |
| Tritax Big Box REIT | 8.9 |
| Capital & Regional | 8.3 |
| Unite Group | 7.9 |
Source: Bloomberg, Marten & Co
| Worst performing funds in price terms | % |
|---|---|
| Regional REIT | (18.1) |
| Real Estate Investors | (8.1) |
| Conygar Investment Company | (7.2) |
| Grit Real Estate Income Group | (5.6) |
| Helical | (5.1) |
| Macau Property Opportunities | (3.3) |
| Palace Capital | (1.7) |
| IWG | (0.9) |
| Ground Rents Income Fund | 0.0 |
| Ceiba Investments | 0.0 |
Source: Bloomberg, Marten & Co
Best performing funds
It already feels a long time ago that Labour won a landslide election at the start of July, but this seems to have had a calming influence on the market. The long-awaited interest rate cut occurred at the start of August, but even before this, the average share price move amongst the listed property sector was +3.1%. Corporate activity was again the driver behind many of the largest share price gains, with European logistics landlord Tritax EuroBox revealing that it was in discussions with more potential suitors following initial interest from Brookfield. A conclusion to Balanced Commercial Property Trust’s strategic review seems to be close, with a bid still on the cards. European property securities trust TR Property posted a double-digit uplift in its share price, mirroring the performance of its portfolio companies during the month. Values were back trending upwards for many of the diversified REITs, with AEW UK REIT (which also reported progress on dividend cover), Schroder REIT and Picton Property all seeing impressive share price gains. Capital & Regional continues to be the subject of takeover discussions, with a second party entering the fray. Meanwhile, student specialist Unite Group raised £450m in a placing.
Worst performing funds
Office landlord Regional REIT saw another sizable drop in its share price following a dilutive £110.5m rights issue in June. The company now languishes on a monstrous discount to NAV of almost 80%. Real Estate Investors is in wind down mode and reduced its dividend to reflect lower earnings from its diminishing portfolio. Three other companies at various stages of winding up – Macau Property Opportunities, Palace Capital and Ground Rents Income Fund – also feature. The residual value of the latter’s portfolio continues to be negatively impacted by leasehold reforms, but in a much more buoyant environment, a flat NAV was enough to earn its and Cuban property investor Ceiba Investments’ places in the table. Many other thinly traded real estate companies also made the worst performing funds table in July, reflecting the volatile nature of their share prices. This was the case for UK investor/developer Conygar Investment Company, and pan-African real estate investor and developer Grit Real Estate Income Group. Having staged a mini share price revival in the wake of its strategic review, in which it vowed to continue in its pursuit of development returns, London office developer Helical gave up those gains and now trades on a circa 35% discount to NAV.
Valuation moves
| Company | Sector | NAV move (%) | Period | Comments |
|---|---|---|---|---|
| AEW UK REIT | Diversified | 3.1 | Quarter to 30 June 24 | 2.4% like-for-like valuation increase for the quarter to £215.8m |
| Schroder REIT | Diversified | 0.5 | Quarter to 30 June 24 | Portfolio value increased 0.3% to £461.6m |
| Picton Property | Diversified | (0.1) | Quarter to 30 June 24 | Like-for-like portfolio valuation increase of 0.4% to £700.2m |
| Balanced Commercial Property Trust | Diversified | (2.1) | Quarter to 30 June 24 | Value of portfolio fell 1.5% to £943.3m |
| Unite Group | Student accom. | 5.3 | Half-year to 30 June 24 | Portfolio valued at £5.7bn, up 2.7% on a like-for-like basis |
| Shaftesbury Capital | Retail | 1.6 | Half-year to 30 June 24 | Portfolio valuation increased by 1.4% on a like-for-like basis to £4.8bn |
| SEGRO | Logistics | (1.8) | Half-year to 30 June 24 | Values were flat; however, NAV fall was largely due to the impact of an equity placing |
| Primary Health Properties | Healthcare | (2.8) | Half-year to 30 June 24 | Value of portfolio declined 1.4% to £2.75bn |
| Hammerson | Retail | (25.5) | Half-year to 30 June 24 | NAV hit by sale of Value Retail stake at 24% discount to book value (see page 4 for details) |
Source: Marten & Co
Leave a Reply