Urban Logistics REIT increases rental rates amid strong demand

(Alliance News) - Urban Logistics REIT PLC on Tuesday said trading in its first half was strong, as demand strengthened and vacancies fell.

The UK logistics real estate investor said, in the six months to September 30, 99% of rents due and demanded were collected. Around GBP600,000 in further rental income was generated following nine rent reviews or re-gears in the period.

On a like-for-like basis, the trust increased rental rates by 59% across all 21 lease events. Further, the occupancy rate rose to 95% at the end of the period, with five further leases let post period, "or in solicitors' hands".

Shares in Urban Logistics were up 3.6% to 130.00 pence each in London on Tuesday morning.

"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," said Chief Executive Richard Moffitt.

Looking ahead, Moffitt said there is the potential for further turbulence in capital markets, but is "reassured" by the resilient demand for its asset class in the occupational market. The firm is keeping an eye out for assets that can create value.

"We remain well placed with our largely fixed debt cost, low loan-to-value [ratio], and immediately available debt facilities at an attractive cost, to acquire assets when the time is right," CEO Moffitt added.

By Elizabeth Winter; [e-mail]

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