MORNING NEWS: Battle lines drawn as PRS REIT fight heats up

Good morning. Here’s your daily round-up of the latest news and views from EG and a collection of industry-relevant headlines from the nationals, all perfectly curated to set you up for the week ahead. The board of PRS REIT has warned of “cost, disruption and potential reputational damage” if a group of shareholders push for the removal of two directors at a proposed general meeting. Last week a group of investors in the company – Harwood Capital, Waverton Investment Management, CCLA Investment Management, Alder Investment Management and CG Asset Management – requested a general meeting at which shareholders could vote to remove two of the five existing independent non-executive directors, chairman Stephen Smith and Steffan Francis.  The shareholders want to oust the directors after a prolonged period of the business trading at a discount to NAV. However, the firm said there had been “limited discussions” with the requisitioning shareholders and that any change to its board would result in costs, disruption and potential reputational damage to the business. PRS REIT has formed a sub-committee comprising the three independent non-executives not subject to the proposed votes – Geeta Nanda, Rod MacRae and Karima Fahmy – to lead the company’s response to the proposed restructure. It has also hired Rothschild & Co to advise on strategy and value maximisation for shareholders. While disruption to the listed REITs may have been a theme this year, with multiple M&A deals, new births are also on the up. Research out this morning shows that the number of new REITs formed in the UK increased by 61% last year, with 28 new listings. The volume of new REITs has been increasing steadily over the past six years, with the total number of REITs now at 157, compared with 74 in 2018. Accountancy firm Lubbock Fine, which compiled the figures, said the removal of the need for REITs to be stock exchange-listed had contributed to the rise. “A lot of new money is being injected into REITs – while at the same time a lot of existing commercial property investment is being converted into REIT structures. Many of the new REITs are existing investment funds converting and using the tax advantages to pass on more value to investors and increase the rate of return,” said Lubbock Fine partner Neil Williams. Elsewhere, deal flow is starting to pick up again after a not-so-quiet August. LondonMetric has completed £120m of transactions, offloading £50m of non-core assets from its LXi and CPTP portfolios and adding £70m of new warehouses to it business. Chief executive Andrew Jones said: “We have been very clear on our desire to monetise some assets acquired from our corporate takeovers. We have now sold around £100m of LXi assets, with 13 of the 16 non-core CTPT assets also sold at an average of 14% above our original underwrite values.” He added: “We have successfully reinvested these proceeds into high-quality properties in stronger sectors that will deliver accelerated income growth.” De Montfort University is headed back to school with 17,000 sq ft of space at LaSalle Investment Management and Trilogy Real Estate’s 135,00 sq ft the Amp. The deal means just 25,000 sq ft remains available in the Aldgate block. Regional flex operator Cubo has signed for almost 19,000 sq ft at Soho Estate’s IIona Rose House, Soho Estate’s redevelopment of the former Foyles bookstore on Charing Cross Road. It is paying around £100 per sq ft for the second floor of the 300,000 sq ft mixed-use scheme. Sticking with flex, former GPE flex expert Jack Kelly has been promoted to chief executive of Office Ready Tech, a technology advisory firm he joined as director of business development and strategic initiatives just six months ago. He takes over from founding partner John Vaughan. EG’s friends at Real Estate Balance are after the industry’s help this morning as they launch the biggest EDI survey in the sector.  The survey, proudly supported by EG, seeks to understand the experiences of people working in property and examine the drivers and barriers to progress. The results help to uncover key EDI issues, identify priorities and share best practice so action can be taken to accelerate change. The survey runs from today until 30 September. Results will be published in November, helping to build an accurate picture of where the industry currently stands on EDI and its direction of travel over time. You can take part in it here. And, this week’s EG news agenda is jam packed with activity as back-to-school season is upon us. There are planning meetings aplenty, results from housebuilders Barratt and Vistry and hotelier Dalata, plus EG’s monthly Demand Barometer, where we take a deep dive into the latest data from PropertyLink to understand exactly which property types and which locations are generating the most interest from potential customers. All of the news from EG, plus a selection of headlines from the nationals: PRS REIT warns of ‘disruption and damage from shareholder pressure’LondonMetric completes £120m of dealsBig Yellow gets green light on London storesAussie listings company makes approach for RightmoveEG’s news agenda: What to look out for this weekFlex tech advisory names new CEODe Montfort powers up at the AmpReal Estate Balance launches property industry’s largest EDI surveyNumber of new UK REITs jumps by 61%GMPF pumps £31m into BTRLISTEN: Ealing Council’s leader on investment, delivering homes and a Labour triumvirateCubo books into new London base at former Foyles storeUrban Pubs & Bars expands with administration buyCOMMENT: Why we should never underestimate the power of human connectionNew kids on the block revel in a shedload of money (£)Anyone for cricket? Pubs boss switches to competitive socialising (£)Creative destruction rips through US commercial property (£)Canary Wharf Group in talks to raise debt against shopping mall (£)Travelodge owner has front-row seat in Cineworld rent row (£)Swathes of green belt land could be used for building new homes (£)The woman tasked with fixing Britain’s housing crisis (£)M&S takes on Pret with grab-and-co coffee shops (£)Former deputy mayor Nicky Gavron dies City minister backed tax raid on landlords (£)Landlord Labour MP apologises for state of rental properties (£)UK councils demand extra cash and end of Right to Buy to boost social housing (£)Hotelier behind Hoxton hotels and Gleneagles warns European development ‘challenging’ (£)