Terrace Hill pares back debt and focuses on supermarkets

Property developer Terrace Hill slashed debts as it sold off most of its residential assets in the first half of the year to begin a new focus on developing stores for major supermarket groups.The AIM group saw triple net asset value (TNAV) increase 4.6% to 28.1p by the end of the six months to 31st March, having sold 919 units of its residential assets for £70.8m, largely completing the sale of its residential portfolio.The sales meant Terrace Hill made significant progress on strategy of reducing the its level of debt and gearing, slashing net debt by £36.8m to £10.4m during to bring gearing down to 16.8% from 78.2% at September 30th 2012.Chairman Robert Adair said: "The first half of the year has been transformational for Terrace Hill both in terms of significantly improving the group's financial position and in the delivery of a very solid operational performance." The group built three new foodstores in Sunderland, Sedgefield and Skelton that it pre-let to Sainsbury and Asda for a total capital value of £64.6m and noted that another four "substantial" supermarkets were in the planning process and other opportunities in the pipeline.On this, Chief Executive Philip Leech said: "We are now undoubtedly one of the market leaders of foodstore developments in the UK, with an impressive track record of completed schemes and a strong pipeline of sites in planning or under review." The company has been active in other sectors, having recently completed construction of a central London office and residential development, with a further project in Mayfair due to start in the summer, with a Darlington leisure complex expected later this year, and a forward funding agreement made for a large student accommodation scheme in Southampton that has already been pre-let and forward sold.Shares in Terrace Hill Group were down 5.2% at 20.5p at 14:00 on Wednesday.OH