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(Alliance News) - UK Commercial Property REIT Ltd on Wednesday reported a slightly decreased net asset value but a positive quarterly return, as it and Picton Property Income Ltd confirmed discussions of a potential merger.
UKCM reported an NAV total return of positive 0.6% for the third quarter of 2023, up from negative 7.9% for the same period last year. NAV per share at September 30 was 80.7 pence, down from 81.1p at June 30 and from 101.5p at September 30, 2022.
UK Commercial Property shares were down 0.4% at 55.77p in London on Wednesday morning.
The company declared a dividend of 0.85p per share for the third quarter, unchanged from the second three-month period.
"The third quarter results show a further stabilisation in values as the Company continues to benefit from the quality of its well let and diverse portfolio," proclaimed UKCM Chair Peter Gray. "This, together with our leasing momentum... [has] led to a positive total return for the period as well as growth in earnings over the same period last year."
The trust's total property portfolio was valued at GBP1.27 billion at September 30. Occupancy increased slightly to 97% on the same date from 96% at June 30, while rent collection "remains strong" at 99%.
Gray commented: "While we continue to be aware of the broader macro conditions and the uncertainty that these present, we remain optimistic about the company's ability to drive value, income and earnings through successful asset management and capturing the near term reversionary potential in the portfolio."
Also on Wednesday, UKCM and Picton both confirmed that talks are ongoing regarding a possible all-share merger of the companies, while Picton said that under the terms of its proposal the combined firm would be internally managed.
However, both companies noted that there can be no certainty of an offer being made.
Picton Property shares were up 1.3% at 67.33p on Wednesday morning in London.
By Emma Curzon, Alliance News reporter
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