UKCM delivered a return of 21.5% in 2021 as its net asset value rose to £1.3bn.
The Abrdn REIT made net pretax profit of £236m, up from a £10m loss in 2020, largely bolstered by a £200m gain on its investment properties, up from 2020’s £45m loss. The investment portfolio rose in value from £1.17bn to £1.5bn over the year.
UKCM, which owns more than 8m sq ft across 40 properties, said performance had been strong across the portfolio, but particularly in the industrial sector, where 63% of its portfolio is invested.
The year marked the REIT’s final exit from high street retail, as it spent £216m on five acquisitions, ranging from forward funding deals to a £94m science park.
The REIT is unlikely to shift its weighting from its overwhelming industrial bias, said chair Ken McCullagh. This is despite the fact that “The extremely strong capital growth achieved by industrials is unlikely to continue at the same level.” However, he added: “Total returns are expected to remain robust for the year ahead.”
McCullagh also said the “bifurcation within the office market” would deepen during 2022, leading to a clear distinction between “the best, with strong ESG credentials, and the rest”.
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