Image: The new chairman of RDI REIT, Gavin Tipper. image by: Hyprop Investment
Image: The new chairman of RDI REIT, Gavin Tipper. image by: Hyprop Investment

RDI makes progress in reducing retail property exposure

By Edward West Time of article published Oct 24, 2019

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CAPE TOWN -  RDI, the income focused UK REIT, which has a secondary listing on the Johannesburg Stock Exchange,has made progress in reducing its retail property exposure, chairman Gavin Tipper said Thursday.

The dividend per share for the year to August 31 came to 10 pence, 3.5 pence lower than 13.5 pence last year.  

Group revenue fell 1.6 percent to 93.5 million pounds. Net operating income was down 2.8 percent to 70.3 million ponds and headline earnings fell 3.8 percent to 8.2 pence per share.

Loan to value was up marginally to 46.8 percent from 46.2 percent.

Chairman Gavin Tipper said in a statement that on a like-for-like basis, net rental income remained flat over the year. 

There had been stable income returns from the London Serviced Office portfolio with occupancy at 93.6 percent. Overall group occupancy remained high at 95.9 percent.

Revenue per available room in the managed hotel portfolio increased 2.9 percent to 84.9 pounds from 82.5 pounds at the 2018 year end.

Activity to reposition the property portfolio in the light of weak retail sector conditions in the UK included the 26.3 million pound acquisition of Southwood Business Park Industrial Estate, Farnborough.

In addition, 26.0 million was spent on forward funding of two distribution units at Link 9 in Bicester.

Disposals came to 121.5 million pounds, at an average premium of 2.5 per cent to market value.

Retail exposure reduced to 35.3 percent from 45.6 percent at August 31, 2018 with a further reduction to 31 percent based on disposals agreed post year end.

Exposure to UK retail had now reduced to 17.9 percent of the portfolio from 29 percent at the same time last year.

"A significant amount of work has been undertaken over the past twelve months, and particularly since we set out our intentions at the half year to further reduce leverage and accelerate the reweighting of the portfolio  through the disposal of certain retail assets,” said Tipper. 


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