Midlands-based investor ‘open to offers’ as it prepares for market uplift
Midlands-focused Real Estate Investors chief executive Paul Bassi has said the business is open to offers for corporate or portfolio deals as it seeks to accelerate its disposal strategy.
Bassi said: “It is business as usual for REI as we approach the final quarter of 2024 and await to see the effects of the summer’s interest rate reduction and the impact of the Labour government.
“We will continue to focus our efforts on selling assets to the existing buyer pool, maximising our income and capital values for future disposals and continuing to pay a fully-covered quarterly dividend to shareholders.”
Midlands-focused Real Estate Investors chief executive Paul Bassi has said the business is open to offers for corporate or portfolio deals as it seeks to accelerate its disposal strategy.
Bassi said: “It is business as usual for REI as we approach the final quarter of 2024 and await to see the effects of the summer’s interest rate reduction and the impact of the Labour government.
“We will continue to focus our efforts on selling assets to the existing buyer pool, maximising our income and capital values for future disposals and continuing to pay a fully-covered quarterly dividend to shareholders.”
He said the REI management team remained “open to evaluating any portfolio or corporate transaction that is in the best interests of shareholders, in order to maximise shareholder returns.”
The comments come as the group prepares for a “period of positivity” after a subdued first half of 2024.
REI saw revenue fall from £6.1m in the six months ended 30 June 2023, to £5.6m in the same period this year. Pretax losses increased from £800,000 to £3.3m, caused primarily by a circa £9m reduction in the value of its portfolio. Like-for-like rental income dipped from £10.6m to £10.3m.
The group also recorded a sizeable increase in its average cost of debt, up from 3.7% to 6.5%.
To manage its debt, the group has been disposing of assets and in the year to date has paid down some £6.7m, with a further £3.6m paid off since the period end. REI now has total drawn debt of £44.4m, down from £67.9m in H1 2023.
Bassi said it had been a “satisfactory period of activity, despite negative market sentiment”.
He added: “We are likely at or near the bottom of this cyclical property decline and look forward to a period of positive activity and the potential for capital and rental growth, supported by lower interest rates and improving investor and occupier demand.
“A normalising market backdrop will contribute to more rapid sales and debt repayment, allowing us to execute our strategy and return capital to shareholders, while continuing to pay a covered dividend.”
