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SHED Urban Logistics Reit Plc

114.40
-1.00 (-0.87%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Urban Logistics Reit Investors - SHED

Urban Logistics Reit Investors - SHED

Share Name Share Symbol Market Stock Type
Urban Logistics Reit Plc SHED London Ordinary Share
  Price Change Price Change % Share Price Last Trade
-1.00 -0.87% 114.40 16:35:21
Open Price Low Price High Price Close Price Previous Close
115.00 114.20 117.60 114.40 115.40
more quote information »
Industry Sector
REAL ESTATE INVESTMENT & SERVICES

Top Investor Posts

Top Posts
Posted at 21/3/2024 16:57 by giltedge1
Smaller property stocks left behind today, LAND, BLAND up 3 -4 %, guess institutional buying, retail investors on side lines still. SHED liked by IC & Mail, so will be recommended soon.
Posted at 24/2/2024 08:21 by ammons
Cant post the graphs in the FT article, sorry. Its dated 21 Feb
==================================================================
UK’s scramble for sheds could be the start of a deals boom.
Deals could beget deals, with bigger companies meaning increased share liquidity which should broaden investor appeal

"Men in sheds” usually refers to British retirees discussing gardening. A more active group is shaking up London’s listed property sector.

There has been a flurry of share-based takeovers focused on warehousing space. Urban Logistics REIT, whose stock ticker is SHED, is the latest to pounce, launching a counter-offer for Aberdeen Property Income Trust this week with aims to create a vehicle worth £800mn.

Commercial property is in the spotlight because of the turmoil that writedowns on US offices are causing lenders. Higher interest rates have slashed valuations across the sector. Industrial property values and logistics in particular are about a quarter lower since the pandemic-era boom in demand. But the scramble for sheds is a sign that the cycle is nearing its trough.

Shares in Segro reflect the decline — they are down about two-fifths since the start of 2022. Smaller peers have performed little differently but ambitions of replicating Segro’s success as the largest UK Reit need one thing; scale.

Hence consolidation. Before the Urban Logistics offer, API was considering a lower bid from Custodian Property. It was low enough, in fact, that some API shareholders were pushing for the fund’s liquidation over a sale.

Other deals are in the offing. LondonMetric’s all-share offer for LXi REIT, at the start of the year, will bring the urban logistics owner together with LXi’s diversified portfolio with a market value of just under £4bn.

Tritax Big Box, which owns larger out-of-town sheds, has agreed to buy UKCM to become the fourth-largest UK Reit worth about £4bn. Simply sticking property assets together doesn’t create much value; Green Street’s Rob Virdee thinks Tritax is overpaying given that UKCM’s more diversified portfolio may not fit well with its specialism.

But deals could beget deals in this sector. Bigger companies mean increased liquidity in the shares, which should broaden investor appeal. Higher valuations will be important in an expected wave of dealmaking, says Paul May at Barclays.

Assets equivalent to the size of the European-listed sector could come to market this year as private owners, including pension and insurance funds, bail out of commercial property. Private equity firms in particular are expected to shift out of less attractive property assets as funds approach their end dates.

This would reverse trends of the low-rate era whereby assets moved from public markets to private owners. The winners should be those with the ability to raise equity more cheaply: greater scale translates into lower costs of capital and improved prospects.

Unlike offices, the fundamentals of the warehouse market look solid in terms of demand for space and rental levels. That should mean plenty more action for the City’s men in sheds.
Posted at 22/2/2024 14:20 by spectoacc
CREI have just come out and said they're still keen - and made this point, similar to ours:

"...ULR provides investors a ‘pure play’ on exposure to logistics real estate, acquiring only ‘last mile’ assets which are well located close to urban areas(2) and the ULR Offer states the combined group would “focus on the last-mile / last-touch mid-box area of UK logistics”.
The API portfolio is highly diverse across Industrial (48%), Offices (25%), Retail warehousing (11%), High street retail (4%) and Other (12%) (% of API’s portfolio by income as at 31 December 2023)(3).
The CREI Board notes that 52% of the API portfolio (as a % of API's portfolio by income as at 31 December 2023) does not represent industrial properties;"


So more than half of API isn't a fit with SHED.
Posted at 22/2/2024 14:10 by jombaston
Surely the API-owned offices will already have been pitched to potential buyers.

The unfixed part of API's funding is through an RCF at SONIA +150bps i.e. 6.7%. If this could have been repaid through sales, particularly of offices, surely it would have been done.

Of course, the API NAV, or at least the office part will have fallen in Q4. So at least offices will be a smaller percentage than currently stated :-)

SHED have a better chance of sorting out the API mess that API have on their own (and they could be lucky with interest rate cuts) but I'd rather they didn't take that risk.

Investors bought SHED because of their clear strategy and sensible financing. Hopefully that means that any bid which threatens this will be voted down. If the SHED management are deemed to have lost their way and motivated purely by selfish considerations then this could make SHED vulnerable to a bigger and better-financed rival
Posted at 24/7/2023 06:04 by skinny
Trading Update

Asset Recycling & Active Management Drive Income

Urban Logistics (LON: SHED), the last mile logistics focused REIT, is pleased to provide an update on trading activity for the period from 1 April 2023 to 30 June 2023.

Highlights:

-- 4 new lettings signed in the period, generating over GBP0.85m of additional rental income
-- 2 rent reviews settled in the period, at a weighted average uplift of 20% generating an additional GBP0.3m of rental income

-- 2 assets sold in the period for gross proceeds of GBP15m, representing a 3.4% premium to March 2023 valuations

-- GBP57m of new fixed rate debt put in place to refinance existing floating rate debt, moving the total debt book to GBP367m drawn, with a further GBP51m of undrawn facility at an all-in rate of 4.2%, 93% hedged or fixed to term, with a weighted average maturity of 6.0 years. The debt is provided by Aviva Investors, and is a sustainably linked loan

-- Following the administration of Tuffnell's, 9 of the 12 leases are being re-assigned on the same terms, and 3 smaller units (representing 0.45% of the rent roll) are actively being marketed.

Richard Moffitt, of Urban Logistics, commented:

"Against a backdrop of a challenging economic and equity market environment our focus is on delivering strong operational and financial performance.

"Our active asset management continues to drive performance and is supported by continued demand from tenants alongside a low national vacancy rate. The rent reviews and new lettings signed in the period have delivered significant additional income to the portfolio and the Company has selectively sold a number of assets where our asset management initiatives are substantially complete. These assets were sold at a premium to their March 2023 valuation.

"The recent refinancing means the Company has a very secure debt position, with capital available to be allocated as opportunities arise. 93% of the debt is now hedged or fixed to term, with the earliest debt maturity is in August 2025.

"The market for assets in the Company lot size remains robust and over the coming months we intend to recycle additional assets, further validating our net asset value. The Board consistently reviews the best use of capital and, where appropriate, will use the funds to selectively acquire assets which have compelling value accretive asset management opportunities to deliver strong income and total returns."

- Ends -
Posted at 28/6/2023 05:11 by scruff1
COMMERCIAL PROPERTY
27 JUN, 2023
Urban Logistics swings to a loss but pricing 'equilibrium' in sight
The last-mile warehouse investor has been hit by the selloff in commercial property but says investors are being tempted back by repriced assets.
Michelle McGagh
BY
MICHELLE MCGAGH
Urban Logistics (SHED) swung to a full-year loss as the warehouse investor counted the cost of the commercial property selloff but says a pricing ‘equilibrium’ will return more quickly than in previous downturns.

The £556m real estate investment trust (Reit), led by chief executive Richard Moffitt, reported a 31 March net asset value (NAV) of 162.44p, which represents a 14% decline for the full year and an 11% drop over the six-month period since 30 September, when the disastrous mini-Budget caused a gilt meltdown and a sharp repricing in property markets.

The fall was, unsurprisingly, driven by a 9.8% decline in valuation over the year. The Reit fell to a pre-tax loss of £82.7m from a profit of £171.8m the year before.

As is the story with most commercial property trusts, while valuations took a hit, rental income was buoyant, with estimated rental value growing by 9.5% over the year. Rents increased most in the ‘active management’ part of the portfolio, up 10.9%, where tenant covenants were improved and leases lengthened.

Moffitt, whose management contract has been extended to 2027 on the approval of shareholders, said this helped ‘protect against the impact of negative yield shift’ in the portfolio.

‘By holding firm to the strategy first set out in 2016, we aim to mitigate the worst effects of the economic downturn,’ he said.

High demand
Despite the valuation write-down, Moffitt said the portfolio of last-mile, single-let logistics assets is ‘in high demand given the undersupply of assets of this type, driven by long-term structural shifts in our economy and a chronic lack of supply’.

‘This supports the occupational market and allows us to offset yield erosion with rising rental rates, captured in 42 lease events over the year, generating £6.1m in additional rental income,’ he said.

Property investors had hoped for a swift uptick in price after the selloff but Moffitt said the ‘macroeconomic and geopolitical picture for 2023 and beyond continues to evolve’.

‘Given the repricing of real estate assets and land values in 2022, we believe the equilibrium level where buyers and vendors will trade has been found more quickly than witnessed in previous cycles.

Investors are already returning to the market, attracted by re-based higher yields, rental value growth and the long-term drivers of the logistics sector.’

Moffitt said e-commerce, which powers much of the logistics sector, remains a ‘fundamental and growing part of the economy’ and therefore provides a ‘sound footing to our business model of last-touch, mid-sized logistics assets, let to financially resilient tenants’.

Low vacancy rates also provide confidence to investors wanting to buy properties and although the cost-of-living crisis is burdening the consumer, and higher labour costs and business rates are weighing on companies, Moffitt said the logistics sector remains ‘attractive217;.

‘We continue to take pride in what we have achieved in what has been a challenging 12 months,’ he said.

‘We have renewed leases with existing tenants, built warehouses for new tenants, and welcomed new team members and shareholders to the company. We see significant opportunity and value within the portfolio and look to the future with a mix of caution, ambition and excitement.’

Leasing success
Numis analyst Andrew Rees said the Reit has a ‘strong track record of leasing success’ that the trust should be ‘well placed to capture over the next 12 months’.

‘This runway for top line rental growth, combined with relatively low cost of debt, should help further improve dividend cover towards 100%,’ he said.

‘In the current environment transaction activity will be focused on the “active management” portion of the portfolio, and we would therefore not be surprised to see further disposals of “core” assets in addition to the £15m since year-end.’

Shares in the trust have been weak recently and are trading at a 27% discount to NAV, which Rees said is ‘not reflective of the attractive occupational demand story, notwithstanding the scope for further yield driven valuation weakness as interest rates look set to be raised further’.
Posted at 25/10/2022 06:10 by skinny
Strong demand for space drives significant new lettings as vacancy rate falls

Urban Logistics REIT (LON: SHED), the last mile logistics focused REIT, announces an update for the period from 1(st) April 2022 to 30(th) September 2022, ahead of the interim results which will be announced on 11(th) November 2022.

Highlights:

-- 99% of rents due and demanded collected in the period
-- 12 new lettings in the period covering 470,000 sq. ft. of space, generating GBP4.0m of additional rental income

-- 9 rent reviews or re-gears in the period, generating an additional GBP0.6m of rental income
-- 59% rental uplift across all 21 lease events for the period, on a like-for-like basis
-- 40% of the portfolio with an EPC rating of A or B, and 86% with an EPC rating A-C, up from 27% A or B and 76% A-C in March 2022

-- Occupancy rate across the portfolio rising to 95% at period end, with 5 further leases either let post period end or in solicitors' hands.

-- Recent deployment of a further GBP3.3m of capital, bringing the total deployed in the period to GBP112m, at a blended NIY of 4.8%

-- GBP122m of debt drawn in the period with Aviva Investors, fixed for 10 years at a cost of 3.8%, bringing total debt to GBP310m, of which 97% is hedged or fixed, and has a blended cost of 3.3% and a weighted average term of 6.4 years

-- Built additional flexibility into our debt facilities during the period, allowing the Company to draw a further GBP51m on demand at a marginal rate of 3.5%, with a term until 2025

Richard Moffitt, Chief Executive, commented:

"In the first half of the year we have continued to demonstrate how we can drive value throughout the property cycle, achieving a 59% like-for-like increase in rental rates. Our approach enables the business to thrive across market cycles due to our core strategy of acquiring mid-box, single-let logistics properties with significant asset management potential.

"Lettings have been strong across the portfolio, as we see a robust occupational market with high demand and low vacancies. In particular, we're very pleased that our new development at Blenheim Park has let so quickly, with the final unit expected to be let shortly, and providing an expected 6.6% yield on cost across the project. Our new lease at Brent Road, Southall, shows the rapid implementation of our asset management plans following acquisition.

"We also have been working hard to demonstrate our commitment to our ESG agenda and goals, which can be seen at the recently completed development at Blenheim Park, where all buildings have an EPC of A and very good BREEAM ratings.

"Looking to the future, we see the potential for continued capital market turbulence, but are reassured by the continuing demand in the occupational market for our asset class. We remain well placed with our largely fixed debt cost, low LTV, and immediately available debt facilities at an attractive cost, to acquire assets when the time is right. Our strategy will continue to be based on value creation through active asset management, leaving us well-positioned in a volatile market."

more.....
Posted at 19/2/2022 08:37 by trekker60
This article may be of interest to Urban Logistics investors:

[...]
Posted at 08/12/2021 09:05 by maiken
the shares haven't traded consistently above NAV,they've recently moved to a premium.They may stay there,they may not.Nobody knows.

Also the ability to renovate and maintain portfolio value is entirely independent of raising new money.Just pay for an ongoing programme from rentals.Of course this fact also renders your point about ability to raise loans redundant.

All previous share issues,apart from the latest,have been dilutive and expensive to existing holders.The fees to the broker.lawyers etc at least 3% of money raised,1% to the agency purchasing,cash drag,and let's not forget stamp duty.Furthermore the placings have been at a discount to NAV and private investors have mostly been excluded.I recall one of them had a 1 for 273 participation offer for existing investors !!!

There are advantages to scale and a main listing including potential institutional interest and maybe the suggestion of a 250p NAV fron nimbo1 is a tad optimistic but the points raised remain valid in my opinion.I remain a holder.
Posted at 02/12/2021 18:49 by metis20
"Due to the strength and quality of demand from investors, the Board has determined to increase the size of the Issue from £200 million to £250 million. Notwithstanding this increase, investor demand significantly exceeded the maximum size of the Issue and a scaling back exercise was undertaken."

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