Property investor establishes solid platform for post-Brexit opportunities

Paul Bassi, chief executive of Real Estate Investors

Birmingham property group Real Estate Investors (REI) believes it is well positioned to take advantage of opportunities in an uncertain post-Brexit market after it unveiled a solid performance in the first half of 2019.

REI said it has “a number of advanced discussions” ongoing as it looks for acquisitions which would enable the investor to add value.

It did not acquire any investment properties in the period because it judged “vendors’ aspirations have been unrealistic”.

REI chief executive Paul Bassi said: “Transactional activity has been relatively low but there is pent-up requirement to trade and we have positioned ourselves with cash and agreed bank facilities of £25m to capitalise on any suitable opportunities that arise.”

He pointed to Coventry 2021 and Birmingham 2022 as drivers of the region’s vibrancy.

“As the UK’s only Midlands focused REIT, REI is well placed to capitalise on opportunities within the buoyant Midlands market,” added Bassi.

REI has a Midlands-focused portfolio of 1.53m sq ft. Occupancy is currently 96.2% and contracted annual rents have increased to £17m.

Underlying pre-tax profit was up 18% to £4m in the six months to June to £4m, with revenue up 8% to £8.1m.

Statutory pre-tax profits saw a significant drop, which was because of a £3.6m reversal in the fair value of investment properties.

Bassi added: “The fundamentals of investing in the UK real estate remain sound, but uncertainty over the Brexit outcome and a lack of distress in the current market is stifling activity.”

REI has declared a half year dividend of 1.875p, up 7.1% on the same period in 2018.

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