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Custodian REIT says property investors looking beyond pandemic

Snapshot

  • Market valuation up considerably since IPO
  • Industrial property booming
  • Recently gained new largest tenant
Custodian

Quick facts: Custodian REIT plc

Price: 95.8 GBX

LSE:CREI
Market: LSE
Market Cap: £402.41 m
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What it does

Custodian REIT PLC (LON:CREI) is a real estate investment trust with a portfolio of assets made of industrial, retail, office and other properties.

The company listed on the main market of the London Stock Exchange in 2014.

Since then, its market capitalisation has grown substantially on the back of investment into UK regional real estate.

 

How it's doing

Custodian REIT raised its latest quarterly dividend by 19% as rental collections including deferrals totalled 96% in the three months to end-December 2020.

The property investor said the higher dividend payout is fully covered by net cash receipts and reflected continuing levels of rent collection seen since the onset of the coronavirus (COVID-19) pandemic.

Richard Shepherd-Cross, the trust’s managing director, said recent levels of commercial property investment activity had also demonstrated that investors are looking beyond the pandemic.

The value of Custodian’s portfolio rose to £545.8mln (£532.2mln end-September 2020) during the three month period, while NAV per share was 96.4p per share (95.2p).

 

What they say: Richard Shepherd-Cross, manager

“Investment activity is increasing and appears to be tracking the emerging picture of forecast occupier demand,” said Richard Shepherd-Cross, managing director of the trust’s investment manager, Custodian Capital.

“There is confidence in the industrial and logistics market where record investment volumes have been matched by record occupational demand for warehouse space. This occupational demand, driven by the continued growth of e-commerce and onshoring of supply chains, combined with low vacancy rates has led to the continuation of rental growth.

“Much of the investment capital that might have been focused on the office or retail sectors has been redirected to industrial and logistics. We see continued opportunity in this sector as the UK has yet to build a sufficient logistics network to support the continued growth in e-commerce.".

 

Proactive Research - Ed Stacey

Inflexion points

  • Dividend for year to March 2022 will be at least 5p 
  • NAV per share of 96.4p at last valuation
  • Rental collections improving

 

Click here to read Ed Stacey's latest report on Custodian REIT

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Proactive Analyst Ed Stacey offers a positive research note on Custodian REIT

Commercial property landlords are having a rough time right now, there's no doubt about it. So, how come Custodian REIT seems so Covid-resilient, releasing a positive quarterly valuation update and a healthy-looking dividend announcement? Proactive Analyst Ed Stacey outlines for investors...

on 4/2/21

2 min read