LONDON (Alliance News) - Ediston Property Investment Co PLC on Tuesday said its net asset value per share rose over its financial year, despite increases in stamp duty charges and the UK's vote to leave the European Union.
Ediston Property said its EPRA net asset value per share at the end of its financial year on September 30 was 107.07 pence, up from 106.49p per share the prior year, and generating a net asset value total return of 6.1% for the year.
The trust said the increase in stamp duty land tax in March affected "all properties in England, Wales and Northern Ireland", and caused property valuations to be adjusted downwards to reflect higher acquisition costs to the buyer.
Ediston also noted the "widespread market volatility" witnessed after the Brexit vote. However, despite both market challenges, Ediston said the value of its property portfolio increased 2.2% over the year ended September 30 to GBP181.4 million.
After the referendum outcome, Knight Frank placed a valuation caveat in place, though Ediston Property said the valuer has since removed this caveat due to market conditions becoming clearer from a pricing visibility perspective.
The trust said the occupational market in the UK was "relatively robust", despite it being "too early to tell what the full impact of Brexit might be", though said rental growth has slowed over the course of 2016 and this trend is likely to continue during 2017.
Ediston said any changes which occur in the market will not be universal but will be fragmented by geography and by sectors, "with central London, where we are not currently invested, predicted to bear the brunt of Brexit".
"As a result of this, and with investors being more risk averse, new construction is likely to be muted. This will help maintain low vacancy rates in many markets," the group said.
Ediston said the way in which investors choose to access property "might be changing", pointing to the advantages a closed-ended company has over open-ended daily-traded property funds in the aftermath of the Brexit vote, and said there has been an increase on the share register of small investors.
The trust said there is likely to be more short-term volatility in yields than normal, which "may create some buying opportunities" which it said it "would like to exploit".
Despite this, Ediston said timing a capital raise to take advantage will "not be easy" and said it was therefore focused on investing capital into the market over a period of time with an emphasis on stock selection.
Shares in Ediston were up 2.5% at 107.67 pence on Tuesday morning.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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