10 May 2012
ALPHA UK MULTI PROPERTY TRUST PLC
(the "Company" or together with its subsidiaries the "Group")
INTERIM MANAGEMENT STATEMENT
Alpha UK Multi Property Trust Plc today publishes its interim management statement for the quarter ending 31 March 2012 and the period up until the date of this announcement. The information contained herein has not been audited.
Highlights:
· Adjusted Net Asset Value per Ordinary Share* of 304 pence at 31 March 2012 (311 pence at 31 December 2011)
· Further reduction in debt of £0.3 million during the quarter
· The loan to value ('LTV') on secured debt was 67.8% as at 31 March 2012
· Excellent progress in letting of vacant units with 26 new lettings and 10 lease renewals completed in the period ending 31 March 2012
· Occupancy levels continue to improve with 81.5% of the property portfolio let, based on estimated rental value, as at 31 March 2012, compared with 78.9% as at 1 January 2012
· Ongoing portfolio review to identify value enhancement opportunities
The Group's strategy continues to focus on preserving and improving the profile of the income from its property portfolio. This should place the Group in a stronger position to obtain acceptable refinancing terms when its principal loan facilities are due to be refinanced later this year. The continuing reduction of borrowings from cash flow going forward is a key part of this strategy.
CHIP (Six) Limited ("CHIP (Six)")
As previously reported one of the Group's subsidiaries, CHIP (Six), was in breach of its banking covenants with the lender (Nationwide). CHIP (Six) had net liabilities at 31 December 2011. Following the appointment of Law of Property Act Receivers by Nationwide on 1 March 2012 the Directors of CHIP (Six) recommended to the Company, as sole shareholder of CHIP (Six), that an extraordinary general meeting of CHIP (Six) Ltd should take place on 26 April 2012 to commence a creditors' voluntary winding up. The resolution has been passed and Mazars LLP was appointed as liquidator.
Accordingly all reference (unless otherwise stated) under the headings; Highlights, Revaluations and Net Asset Value, Property Update and Financing, within this interim management statement excludes CHIP (Six).
Revaluation and Net Asset Value
The Company's Adjusted Net Asset Value per Ordinary Share* was 304 pence at 31 March 2012 (311 pence at 31 December 2011).
The Company's property portfolio was valued at 31 March 2012 by DTZ Debenham Tie Leung Limited at £89.6 million; this represents a £0.2 million (0.2%) fall on a like for like basis compared to the valuation excluding CHIP (Six) at 31 December 2011. The property portfolio will next be valued by an independent valuer at 30 June 2012.
* The adjusted net asset value per share is presented to provide what the Board believes is a more relevant assessment of the Group's net asset value per share. The net asset value per share has been adjusted for the effect of interest rate derivatives.
Property Update
The Investment Adviser and Manager continues to progress the published strategy to deliver shareholder value namely:
· To enhance net rental income
· To deploy capital when 'value add' opportunities are identified
· To undertake limited strategic sales
· To amortise borrowing through surplus rental income and to reduce the LTV
Occupancy across the portfolio has increased with 81.5% of the Portfolio let as at 31 March 2012, based on the estimated rental value, compared with 78.9% as at 1 January 2012. Good progress continues to be made in letting void units; 26 new lettings and 10 lease renewals have been successfully completed in the period to 31 March 2012 at a final achievable annual rent, including stepped rent, of c £0.44 million per annum.
Tenant/letting activity can be summarised as follows:
Period 1 January to 31 March 2012 | Number of Tenants | Rent p.a £ | As % of annual Estimate Rental Value |
Tenant lease breaks exercised | 2 | 33,750 | 0.33% |
Tenant vacated at lease end | 7 | 32,223 | 0.31% |
Tenant insolvency | 3 | 40,750 | 0.40% |
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|
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New lettings completed | 26 | *441,224 | 4.31% |
Tenant leases renewed | 10 | *88,255 | 0.86% |
*Final achievable annual rent including stepped rent |
Financing
During the quarter to 31 March 2012, the Company reduced borrowings by a further £0.3 million. As a result of these loan repayments, the total secured debt of the Company has been reduced to £60.8 million.
The LTV of the Group's secured debt was 67.8% at 31 March 2012.
As previously reported the loan facilities provided by Bank of Scotland (in respect of CHIP (One) Limited, CHIP (Three) Limited, CHIP (Four) Limited and CHIP (Five) Limited) and Nationwide (in respect of CHIP (Two) Limited) are due to expire on 31st October and 23rd October 2012 respectively.
Discussions are continuing with Bank of Scotland and Nationwide to extend the existing facilities. Discussions are also continuing with a number of other banks which have expressed interest in refinancing tranches of the Group borrowings. The Board will continue to pursue all refinancing options available to the Group.
Contact:
Jonathan Clague
Chairman, Alpha UK Multi Property Trust Plc
+44 (0) 1624 681250
Tom Pissarro
Fund Manager, Alpha Real Capital LLP
+44 (0) 20 7268 0300
For more information on the Company please visit www.alphaukmultipropertytrust.com.
For more information on the Company's Investment Adviser and Manager please visit www.alpharealcapital.com.
Forward-looking Statement
This interim management statement contains forward-looking statements which are inherently subject to risks and uncertainties because they relate to events and depend upon circumstances that will occur in the future. There are a number of factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements are based on the Board's current view and information known to them at the date of this statement, whether as a result of new information, future events or otherwise. Nothing in this interim management statement should be construed as a profit forecast.
