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Custodian Property Income REIT PLC said 2024 could be a turning point for real estate investment, as it reported a decline in net asset value in its recent financial year. The real estate investment trust focused on UK commercial property said net asset value per share fell 5.9% to 93.4 pence as at March 31 from 99.3p a year prior. NAV total return was negative 0.4% compared to negative 12.5% a year ago. Looking ahead, Chair David MacLellan said the company’s portfolio is well placed to benefit from any upwards re-rating in sector valuations as interest rates come down and the UK economy improves. He highlighted: ‘The first move down in interest rates should be the real catalyst for a positive shift in sentiment towards real estate investment, so later in 2024 could be a turning point in the market.’ He added: ‘In an inflationary environment and with a lack of supply of modern, smaller regional properties we expect to see continued rental growth over the year ahead. Furthermore, where we can provide space that meets the modern environmental standards demanded by both legislation and tenants, we expect to see additional rental growth. ‘It will be this growth in income that is likely to form the greater component of total return over the next phase of the property market and we believe that Custodian Property Income REIT’s strong income yielding portfolio, supported by higher-than-peer group EPRA [earnings per share], will continue to underpin shareholder returns.’ The company paid total dividends of 5.8 pence per share for financial 2024, including a 0.3p special dividend. It plans to pay a 6.0p ordinary dividend for financial 2025, up 9.1% from 5.5p. Custodian Property shares were 0.1% lower at 72.30 pence each on late Thursday morning in London. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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