RNS Number : 4077D
Mucklow(A.& J.)Group PLC
16 May 2012
A & J MUCKLOW GROUP PLC
Interim Management Statement
16 May 2012
A & J Mucklow Group Plc, the Midlands based Real Estate Investment Trust, issues its Interim Management Statement covering the period from 1 January 2012 to 15 May 2012.
Rupert Mucklow, Chairman, comments:
The Midlands industrial occupier market has shown some encouraging signs of improvement since our half year end, particularly from trade operators, where we have recently agreed new lettings to Howdens, Screwfix, Euro Car Parts, Floors 2 Go and City Electrical. However, our vacancy rate has increased marginally, from 6.5% to 6.9%, mainly due to the planned return of two large industrial units in Birmingham, totalling 60,000 sq ft.
Rental levels and letting incentives are starting to harden for better quality properties, as tenant demand picks up and availability of modern space reduces. However, property values appear to remain unchanged during the third quarter, as there has been very little investment activity, or decent buying opportunities.
Two investment properties were acquired during the period at a total cost of GBP5.8m, including stamp duty and professional fees. The properties currently generate a combined income of GBP0.54m per annum and show an average return on cost of around 9.3%.
First in February 2012, we acquired a 15,800 sq ft office building in Coventry for GBP1.5m, as previously mentioned in our Interim Report. The property was built in 2000 to a high specification and is currently let at a rent of GBP0.24m per annum.
Subsequently in April 2012, we acquired a modern 64,300 sq ft industrial unit in Tewkesbury for GBP3.95m. The property is located close to junction 9 of the M5 motorway and has recently been let on a 15 year lease at an initial rent of GBP0.30m per annum, increasing to GBP0.34m per annum at the end of the fifth year.
We sold our industrial land in Wakefield, Yorkshire on 15 May 2012 for GBP1.5m, marginally above book value. Any future developments are likely to be focused on the Midlands.
Our joint planning application with Helical Retail for a mixed use development in Tyseley, was approved by Birmingham City Council on 26 April 2012. We will benefit from having 5 acres of industrial land being rezoned for non-food retail and a new 'spine' road, which will greatly improve the prominence of our 20 acre site.
The Group's gearing level had increased to 38% at 30 April 2012, as a result of the two investment acquisitions and the final dividend payment made during the period. Other than stated above, there has been no significant change in the Group's financial position since 31 December 2011 and we remain on target for another satisfactory year to 30 June 2012.
Rupert Mucklow, Chairman
David Wooldridge, Finance Director
0121 550 1841
This information is provided by RNS
The company news service from the London Stock Exchange