GCP Student Living Net Asset Value, Portfolio Update and Dividend
30 April 2018 - 4:00PM
UK Regulatory
TIDMDIGS
GCP Student Living plc
("GCP Student" or the "Company", together with its subsidiaries the "Group")
LEI: 2138004J4ID66FK38H25
Net Asset Value, Portfolio Update and Dividend
Net Asset Value
GCP Student Living, the UK's first REIT focused on student residential assets,
today announces that at close of business on 31 March 2018, the unaudited
estimated EPRA net asset value per ordinary share of the Company was 146.92
pence. The EPRA net asset value includes income for the period (cum-income) and
does not include a provision for an accrued dividend for the quarter to
31 March 2018.
The EPRA net asset value (ex-income) was 145.44 pence per ordinary share as at
that date, representing a quarterly increase of 0.4%.
Portfolio update
At 31 March 2018, the valuation of the Company's portfolio was GBP759.1 million,
95% of which was located in and around London, representing a like-for-like
increase over the quarter of 0.6%.
The portfolio comprised ten assets with c.3,600 beds. Eight of the assets are
currently operational whilst two of the assets are under construction / in
refurbishment. The Net Initial Yield on the operational portfolio was 5.01%.
Operational Portfolio:
The focus on assets in and around London has delivered stable NAV performance
over the period. Whilst the Company has not benefitted from any material yield
compression over the period, it notes the recent sale of a portfolio of c.3,600
beds primarily located in London which was achieved at a net yield estimated by
the Investment Manager of c.4.3%.
Assets under construction / in refurbishment:
During the period under review, the Company's Woburn Place asset, which has
been rebranded as Scape Bloomsbury, remained closed in order for it to be
reconfigured and refurbished, as set out at the time of its acquisition in
April 2017. The refurbishment of Scape Bloomsbury involves diversifying the mix
of accommodation units, offering modern studios and single and double occupancy
apartment-style accommodation, which is expected to increase the annual rental
income previously generated by the property prior to its acquisition by the
Company. Scape Bloomsbury remains on track to re-open in September 2018,
in-line with forecast, with the refurbishment costs currently in line with
budgeted expectations. The property, which is located in central London, WC1,
will provide c.430 beds.
The Company's forward-funded construction at Circus Street, Brighton - which
was acquired in August 2018 - remains on track for completion in September
2019. The property will provide c.450 beds and c.30,000 square feet of
commercial office space. The student accommodation will be contracted on a 21?
year lease, with upward only annual uplifts of RPI plus 50 basis points capped
at 5% and floored at 2%, to a subsidiary guaranteed by Kaplan, a global
education provider.
Additional information on the Company's portfolio can be found in the factsheet
for the period ended 31 March 2018 which will be published shortly and
available at www.graviscapital.com/funds/gcp-student/literature.
Dividend
The Board is pleased to announce a third interim dividend of 1.48 pence per
ordinary share, in respect of the quarter ended 31 March 2018. The third
interim dividend will be paid on 11 June 2018 to ordinary shareholders on the
register at 11 May 2018. The dividend will be paid as 0.92 pence per ordinary
share as a REIT property income distribution ("PID") in respect of the Group's
tax exempt property rental business and 0.56 pence per ordinary share as an
ordinary UK dividend ("non-PID").
The Company targets a fully covered dividend over the longer term. Where assets
in its portfolio are being refurbished or are under construction (as is the
case with Scape Bloomsbury and Circus Street, Brighton), cover may be lower
over the short term. The acquisition of such assets enables the Company to
secure properties located in areas which benefit from favourable supply and
demand characteristics, where appropriate operational assets may not be
available, and which the Directors believe will provide regular, sustainable
dividends with rental growth prospects over the longer term.
The dividend was 65% covered by adjusted EPS for the six-month interim
accounting period to 31 December 2017. On the basis of an investment portfolio
which is fully operational, and assuming current occupancy levels across the
portfolio, the Directors expect the dividend to be fully covered.
Where the Company acquires forward-funded assets that are under construction,
it seeks to benefit from licensing fees providing revenue through the
construction phase which supports its objective of regular, sustainable
dividends over the longer term. The Circus Street asset provides a 5.5% coupon
during its construction phase.
30 April 2018
For further information please contact:
Gravis Capital Management Limited +44 020 3405 8500
Tom Ward tom.ward@graviscapital.com
Nick Barker nick.barker@graviscapital.com
Dion Di Miceli dion.dimiceli@graviscapital.com
Stifel Nicolaus Europe Limited +44 020 7710 7600
Neil Winward neil.winward@stifel.com
Mark Young mark.young@stifel.com
Tom Yeadon tom.yeadon@stifel.com
Buchanan +44 020
7466 5000
Charles Ryland charlesr@buchanan.uk.com
Vicky Watkins victoriaw@buchanan.uk.com
About GCP Student Living
The Company was the first student accommodation REIT in the UK, investing in
modern, purpose-built, private student residential accommodation and teaching
facilities. Its investments are located primarily in and around London where
the Investment Manager believes the Company is likely to benefit from supply
and demand imbalances for student residential accommodation.
GCP Student's property portfolio comprises ten assets with c.3,600 beds which
are either currently fully operational or expected to complete construction/
refurbishment over the next two academic years. At 31 March 2018, its property
portfolio was valued at GBP759.1 million.
The Company's standing properties are mainly occupied by international students
and offer high specification facilities and hotel-level concierge type services
which the Investment Manager believes are attractive to overseas students.
END
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