(Alliance News) - UK Commercial Property REIT Ltd on Tuesday reported a decline in net asset value total return as NAV was up marginally quarter-on-quarter.
The UK-focused real estate investment trust said net asset value per share at June 30 was 81.1 pence per share, up 0.6% from 80.6p at March 31, but down 28% from 112.9p a year prior.
NAV total return deteriorated to 1.7% in the second quarter from 2.2% in the first quarter and from 2.3% a year ago.
Rent collection remained unchanged from a year ago at 99%.
The company maintained its second quarter dividend at 0.85 pence per share.
Looking ahead, Chair Peter Gray said: "While uncertainty surrounding future inflation and interest rates remains, there is a cautious but increasing feeling that the worst of the market valuation declines are behind us and that we can look forward with more confidence. Our team continues to drive value and income through the successful asset management of the company's high quality portfolio and we look forward to this continuing into the second half."
The company cautioned however: "Looking forward, given the risks of significantly overtightening policy, we remain sceptical rates will follow the market curve which currently sees [Bank of England] rates climbing close to 6%. With the interest rate regime likely to tip the UK economy into recession, our base case forecast sees an easing of monetary policy to begin during 2024, reducing rates. Risks to this base case exist around both a surprise burst of stronger inflation than expected, forcing the Bank into a more aggressive rates stance, and mounting pressure on the government to ease fiscal policy, particularly around introducing substantial mortgage relief."
UK Commercial Property REIT shares were 0.3% higher at 52.23 pence each on Tuesday morning in London.
By Tom Budszus, Alliance News reporter
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UK Commercial Property Trust (UKCM)