UK Commercial Property Trust Limited (LSE: UKCM), the largest UK focused, Guernsey based, commercial property trust, announces its Interim results for the half year ended 30 June 2015.
· NAV per share of 85.4p (31 December 2014: 83.0p), a rise of 2.9% driven by 2.4% capital growth in the property portfolio which is now valued at £1.24 billion;

· NAV total return of 5.2% in the six month period to 30 June 2015, behind the MSCI benchmark (6.2%) but ahead of the FTSE All-Share Index (3.0%);

· Positive share price total return of 5.4% driven by the continued strong rating of the Company's shares which stood at a premium to NAV of 6.7% as at 30 June 2015, reflecting ongoing attractiveness of the asset class;

· Following debt refinancing, gross gearing of 18.5% (net 9.6%) and blended interest rate of 2.89%, both the lowest in the Company's peer group;

· Significant cash resources of £132 million available to invest;

· Attractive and secure dividend yield of 4.0%, supported by a high quality property investment portfolio, comparing favourably to yield on the FTSE REIT Index (2.8%) and the FTSE All-Share Index (3.5%);

Property Highlights
· Portfolio total return of 4.9% with all sectors delivering positive performance;

· In-line with portfolio strategy, extensive portfolio repositioning undertaken including the following:

· Sale of the Sovereign Centre, Weston-super-Mare, Pall Mall Court, Manchester, North Street, Brighton and Kensington High Street, London (post period end) for a combined consideration of £133 million, above that of valuation thereby reducing exposure to retail and removing assets with limited future return prospects;

· Post the period end, purchase of Eldon House for £28.6 million (including stamp duty), giving the Company exposure to the vibrant City of London office market and offering a number of asset management opportunities;

· Successful asset management activity in the period generating valuation and rental income increases during the first six months of the year including:

· Two new flagship stores for H&M created at The Parade, Swindon and High Street, Exeter on long term leases which maintains income and should result in future capital uplifts;

· Securing Primark as a new anchor tenant to The Charles Darwin Centre, Shrewsbury;

· Negotiating lease surrender with a tenant on George Street, Edinburgh to facilitate a new flagship letting to the Clydesdale Bank Plc generating a total return of 15.8% on this asset in the six month period;

· A void rate of 3.3% at 30 June 2015 compared to a benchmark figure of 6.9% plus strong rent collection rate of 99% after 28 days, affirming the prime nature of the Company's portfolio and testament to successful asset management activity.

Commenting on the results, Christopher Hill, Chairman of UKCPT, said:
"During the first half, UKCPT continued to deliver positive shareholder returns, albeit at a steadier pace than in 2014. The portfolio generated positive income and capital returns of 2.5% and 2.4% and the Investment Manager took advantage of the strong market to sell a number of assets which had limited future return prospects."

"Following the significant portfolio repositioning out of such properties, the current focus is to re-invest in assets that offer the potential, through the deployment of expert asset management, for a growing and sustainable income stream and capital appreciation. These assets are also expected to benefit from the strengthening of the UK economy, while still maintaining the prime nature of the portfolio. In the short term, this may mean acquisition costs and higher than normal cash levels impact performance. However, over the medium to longer term, we expect this strategy to continue to deliver the strong returns it has produced for shareholders since inception."

StockMarketWire.com
UK Commercial Property's H1 pretax profit has fallen to £27.3m, from £44.5m. Total income was £38.4m, from £64.4m.

"In a year which has so far been dominated by the political and economic uncertainty of the EU Referendum, UKCPT delivered a creditable performance in the first six months of 2016," said chairman Andrew Wilson.

"UK commercial real estate continues to provide a significant yield premium to other assets and, with lower gearing levels, higher occupancy rates and muted levels of new supply, the asset class should remain resilient.

"Furthermore, and whilst it is too early to point to any definitive trends post referendum, we have seen occupier demand in our own portfolio remain stable in most sectors."

Net asset value per share was at 86.5p on June 30, from 86.7p on Dec. 31, 2015. Dividend per ordinary share was 1.84p, unchanged.