Supermarket Income Reit Share Discussion Threads

[belgraviaboy] 15/11/2017 16:18

Fan of SUPR so far. Deployed cash quickly. Raised more successfully. Stuck to what they said they were going to do.

Most of the sites have a potential dual logistics purpose should we see a terminal decline in face-to-face grocery shopping.

I know a couple of the sites e.g. the Sainsburys on the M20 and they are prime retail real estate.

Happy holder.

[davebowler] 08/11/2017 13:55

Citywire;
Aviva targets 5% yield with £200m launch of first Reit
By Michelle McGagh 07 Nov, 2017
Aviva targets 5% yield with £200m launch of first Reit
Increasing demand from investors has seen Aviva Investors plan to float its first real estate investment trust (Reit).

The fund group is aiming to raise £200 million in the initial public offering of the Aviva Investors Secure Income Reit on the London Stock Exchange.

The Reit will hold a portfolio of long-lease property assets, typically with a minimum lease length of 10 years and a targeted weighted average length of 15 years to expiry.

It will invest in buildings across the UK that are rented to ‘investment grade’ tenants, such as well-known companies, to reduce the risk of defaults on rent payments that impact the income stream to investors.

Renos Booth, who will manage the Reit, said the fund would invest in ‘core’ property assets such as offices and industrials that were leased to ‘fit for purpose [businesses] and strong trading stores’ such as supermarkets.

It will also invest in the alternative property sector, identifying ‘university assets, hotels, and even healthcare’, said Booth.

Aviva Investors is already the UK’s largest real estate manager, with £24 billion of properties under management. It has already identified a portfolio of £85 million comprising of a hotel and GP surgery in the South East, an office in the North West and a supermarket in the South East. There is a follow-up pipeline of £400 million.

The fund will target a total return of 7% a year over the medium term, including a dividend yield of 5% a year, starting at 3% in the first year. It will aim to increase the dividend in line with inflation.

‘The product will provide a secure but growing income that will grow broadly in line with inflation and provide lower volatility,’ said Booth.

He added that the FTSE was at a record high while gilt yields were at a record low, leaving investors with nowhere to turn for income.

‘We’re offering an attractive yield supported by an alternative asset class and that yield does not come at any additional risk,’ said Booth.

‘It’s a defensive play, we’re not trying to capture double-digit growth, but offer predictable yield.’

Aviva Investors runs a similar property-focused fund called Lime Property. The £1.9 billion fund is only open to institutional investors such as pension funds.

Booth said the experiences of Lime Property, which is the ‘least volatile real estate fund in the market’, would be transferred to the Reit, although the institutional fund does not employ gearing while the Reit will.

‘It’s a different structure and ungeared but what we are looking to invest in is not dissimilar,’ he said.

The institutional fund invests in slightly longer leases, averaging 20 years, while the 10 years-plus leases being targeted by the Reit will mean the yield will be higher.

Launch of the Reit marks a return to the closed-ended trust space for Aviva, whose former Morley fund management group used to run the Morley Absolute Growth investment company.

Aviva has instead had an impact on the sector by its large-scale selling of a number of investment trust stakes acquires as part of its 2015 takeover of Friends Life.

[bscuit] 07/11/2017 00:32

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