Friday, 15 July 2016 18:15

Exposure to Germany helps shelter Redefine International amid post-Brexit jitters about UK

Written by
Rate this item
(0 votes)

Redefine International says its diversified portfolio has been less affected by the Brexit vote than other UK-focused property funds.

 Michael Watters Redefine International

Redefine International says its diversified portfolio, which has exposure to Germany, has been less affected by the Brexit vote than other UK-focused property funds.

The company has also managed to retain those investors who seek income payouts.

CEO Mike Watters said on Tuesday that the company had weathered the effects of the Brexit referendum better than a number of other UK-focused property groups.

“We firmly believe the diversified nature of the Redefine International portfolio, with 21% of market values located in Germany, together with our income focus and long average lease length, will prove to be defensive in light of the uncertainty following the UK’s vote to exit from the EU.

“We remain comfortable with our debt profile, with an average debt maturity of 7.4 years, and no significant debt maturing until 2020,” said Watters.

Redefine said it had made progress in generating returns from its recently acquired Aegon UK (AUK) portfolio that it bought for £490m.

After the EU referendum result, Redefine International completed two leases in the AUK portfolio totalling £600,000, which represented a 10% rise in estimated rental value.

Since exchanging contracts on the AUK portfolio in September 2015, the company has increased the portfolio’s weighted average unexpired lease term from seven-and-a-half years to eight years, saved £300,000 in vacancy costs, and achieved an additional uplift of £600,000 to annualised rental income, representing a 5% increase on estimated rental value.

Watters said completed refinancing activities since its halfyear results had reduced the cost of debt to 3.4%, from 3.6%.

“We are pleased with the level of income-enhancing activity achieved on the AUK portfolio to date. Investors are attracted to the fact that we distribute strong regular income payouts. I believe this is why post the Brexit vote, we have seen our shares sold down but, not as much as some other counters have,” said Watters.

source" Business Day

Last modified on Friday, 15 July 2016 18:26

Most Popular

Supporting solar energy solutions in South Africa

May 29, 2017
Parabolic Trough Solar Thermal Electric Power Plant
As part of the government’s Renewable Energy IPP Procurement Programme (REIPPP), that…

Echo Polska Properties completes acquisition of Warsaw retail development

Jun 01, 2017
Galeria Młociny
Echo Polska Properties, the dual JSE and LuxSE listed ‘pure Polish property play’…

Breathing new life into the CBD

May 29, 2017
Gustav Voigts Shopping Centre
Upmarket development in Windhoek’s central business district (CBD) is on the rise and has…

How junk status will affect the property market

Jun 08, 2017
Jacques van Embden
News broke last week that The Fitch ratings agency could affirm SA’s rand-denominated…

Green Building Council South Afica inspires South Africans to connect with nature on World Environment Day

May 30, 2017
Hotel Verde eco pool smaller
The Green Building Council SA (GBCSA) is celebrating World Environment Day on 5 June with…