5 February 2025
Grainger
plc
("Grainger", the "Group", or the "Company")
TRADING
UPDATE
Delivering accelerated
growth; strong outlook
· 15%
growth in total net rental income
· Total
like-for-like rental growth strong at 4.7% YTD
· Stabilised PRS portfolio occupancy remains high at
96.0%
· Strong
lease up on new schemes continues well ahead of
underwriting
· New
schemes opening in Oxford, London and Bristol this year
· Continued strong rental demand
Grainger plc, the UK's largest
listed provider of private rental homes with a c.£3.4bn operational
portfolio of c.11,100 homes and a £1.4bn pipeline of a further
c.5,000 build-to-rent homes[1], today
provides an update on trading for the four months to the end of
January 2025, alongside its AGM which is being held today at its
head office in Newcastle upon Tyne. The Company will announce its
half year results for the six-month period ending 31 March 2024 on
15 May 2025.
Helen Gordon, Chief Executive of Grainger,
said:
"Grainger continues to perform
strongly, delivering 15% growth in total net rental income on the
same period last year, and up from 14% growth reported at FY24.
This reflects the growth in our portfolio, the strength in our
leasing and supportive Build to Rent ("BTR") market with excellent
fundamentals. We expect to deliver continued growth in strong,
reliable, cash-backed earnings for years to come, and our
conversion to a REIT later this year, marks Grainger's
transformation away from a trading business to a total returns
focused investment business underpinned by reliable, recurring
income.
"We expect earnings[2] to grow by 50% in the medium term through the
delivery of our committed BTR investment pipeline. Today's
announcement of 15% net rental income growth demonstrates the
progress in the delivery of this.
"Our leading operating platform
powered by our CONNECT technology platform enables us to keep
central costs relatively flat whilst we grow materially, driving
this significant compounding earnings growth over the coming
years.
"A supportive regulatory backdrop
alongside an increasing number of positive
statements in support of Build to Rent from the UK
Government further strengthens our outlook
for the future."
Robust rental performance continues
Our market-leading operational
platform, underpinned by CONNECT, continues to deliver
value.
PRS rental growth remains at good
levels, with very strong demand for our mid-market product and
excellent customer service. Occupancy remains high and is in line
with expectations given the seasonality of the lettings
market.
|
· Total
net rental income
|
15.0%
|
|
· Total
like-for-like rental growth YTD:
|
4.7%
|
|
· PRS
like-for-like rental growth YTD:
|
4.4%
|
|
· Regulated tenancy like-for-like rental growth YTD:
|
7.5%
|
|
· Occupancy in our PRS portfolio remains high (spot, as at 31
Jan):
|
96.0%
|
Strong sales performance funding BTR investment and future
growth
·
Sales generated from our regulated tenancy
portfolio as it unwinds continue to provide a reliable source of
capital for our continued growth and accelerating
earnings.
·
We are seeing good levels of liquidity and demand
in the residential sales market.
·
We continue to see strong pricing, achieving
average sales prices 0.5% ahead of valuations.
·
As our regulated tenancy portfolio reduces in size
over time, we expect to see volumes of vacant sales from this
portfolio to reduce too.
·
We continue to focus on our elevated asset
recycling activity, selling low yielding tenanted properties,
portfolios and land to reinvest the capital into our BTR pipeline
and new higher-yielding BTR opportunities.
Outlook
The fundamentals of the UK
residential rental market remain exceptionally supportive, as
demand continues to grow and rental supply continues to be
constrained as small, private landlords face increasing
headwinds.
The regulatory backdrop is
accelerating this trend, whilst we also have seen an increasing
number of positive statements in support for Build to Rent from the
UK Government.
We will deliver significant earnings
growth as we deliver our pipeline, leveraging our operating
platform. This growth is highly accretive as we fund it from the
disposal of low yielding non-core assets, including our regulated
tenancy portfolio, into new higher yielding BTR homes.
-ENDS-
For
further information:
Grainger plc
Helen Gordon / Rob Hudson / Kurt
Mueller
London Office Tel: +44 (0) 20 7940
9500
Camarco (Financial PR
adviser)
Ginny Pulbrook / Geoffrey
Pelham-Lane
Tel: +44 (0) 20 3757
4992/4985
