Refinancing costs pushed Schroder Real Estate Investment Trust to a £32.5m loss in the year to 31 March, although the group’s property chief said the business remains well-positioned to face the ongoing challenges of the Covid-19 pandemic.
SREIT posted a 13% fall in NAV and a 9.4% drop in NAV total return for the year. The company pinned these falls and the overall loss on a one-off debt breakage and refinancing costs of £27.4m. In October the REIT refinanced a £129.6m term loan with Canada Life to save £2.5m a year.
Duncan Owen, Schroders’ global head of real estate, told EG: “There were three things that were important over the year, which now look heroic. We sold 20% of the portfolio at £95m, a huge premium, and that’s a 3% initial yield. We used some of those proceeds to refinance. We couldn’t get those sales proceeds now if we were selling the assets, and we couldn’t get the debt terms on the refinancing if we did it now. And we outperformed by 170 basis points the listed peer group in the MSCI index.”
