Real Estate Investors highlight positives in ‘sluggish’ market

Real Estate Investors Paul Bassi

Real Estate Investors (REI) chief executive Paul Bassi will tell the AGM later today of the Midlands-focused REIT’s solid performance in a “sluggish” property market.

In January the Birmingham-based property group put its entire portfolio up for sale, giving itself a three-year window to sell its properties.

Bassi will say: “In a challenging market we are pleased to report the ongoing lettings progress across our portfolio, which will maximise our rental income and occupancy levels, supporting our ongoing dividend commitment.

“The portfolio is continuously subject to active asset management which provides quality assets for disposal as part of our strategic sales programme and increases occupancy, revenue and capital values. Although private investors and special purchasers continue to invest, we anticipate that the market for larger property investment transactions will pick up once interest rates decrease and this year’s General Election concludes.

We remain focused on sales and debt reduction and have a strong sales pipeline in legals.  The key objective of the Board is to deliver on the stated strategy of an orderly sales programme to maximise the return of capital to shareholders.”

Key leases include Birch House in Oldbury, where DHU Health Care CIC has leased the entire 35,749 sq ft for ten years at £625,608 per year, following refurbishment by REI.

Leases awaiting finalisation at Jasper Park, Tunstall, include a 20-year agreement with McDonald’s at £55,000 per year on a previously vacant unit.

At Market Centre, Crewe, the British Heart Foundation has agreed to a ten-year lease at £57,500 per year for the ground floor and part of the first floor of the former Argos unit.

In 2023, Costa signed a lease for £89,000 per year at Topaz Business Park, Bromsgrove. This lease has been sold for £1.6 million, with construction of the Costa unit expected to be completed by September 2024.

At The Maypole in south Birmingham, InHealth Ltd has leased the former Halfords unit of 4,500 sq ft for 15 years at £65,000 per year.

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