Midlands-focused Real Estate Investors has underlined robust performance from its convenience store and essential services portfolios, as reduced demand for offices hits its occupancy levels.
The REIT has collected nearly 90% of rent owed for Q1 this year, including 2.1% in deferred payments. For its full 2020 year, it has received 95.3% of rent owed.
The firm, which has 263 tenants across 53 properties, saw occupancy fall to 91.6%, from 96.3%.
This was blamed on known lease events, mainly in the office sector, that “in a normalised marketplace would provide opportunities to increase lease terms and improve our average lease length, along with the potential for capital uplifts”.
During the year it completed 34 lease events, including seven renewals. The WAULT of its portfolio has improved to 4.8 years to break and 6.5 years to expiry, from 3.8 years to break and 5.8 years to expiry in the previous year.
The company highlighted its convenience and neighbourhood portfolios as particularly strong performers, noting rises in occupier requirements from national c-store and essential services operators.
“The pandemic-driven increase in turnover experienced by these businesses has seen many seek to rapidly expand their presence,” said the company. “Our focus on convenience and neighbourhood assets will continue as opportunities emerge.”
Chief executive Paul Bassi said: “The diversity of our portfolio and intensive asset management has resulted in resilient levels of rent collection, and has allowed us to combat much of the impact of Covid-19, which has devastated many other businesses.
“With a growing occupier demand resulting in new pipeline lettings for our void space, combined with portfolio lease renewals, we believe that we will move forward with a stable and secure property business, to make opportunistic sales and acquisitions that support a continued progressive dividend policy.”
The company paid out a 0.5p quarterly dividend during its financial year ending December 2020. The level of the final dividend is expected to be confirmed in March.
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