TR Property Investment Trust PLC on Friday said its annual performance was worse than its benchmark, citing macro-economic volatility.

The London-based property investor said its net asset value per share for the financial year that ended March 31 was down 38% to 305.13 pence at year-end from 492.43p a year before.

NAV total return for the year was negative 35% from a positive 21%, and below the benchmark of negative 34%, FTSE EPRA Nareit Developed Europe.

The company swung to a loss of £549.4 million on investments from a gain of £249.0 million the prior year. It said that it had been ‘a very difficult year for the property market, for property shares and for the company’, highlighting macro-economic disruption, with the trajectory of inflation remaining everyone’s focus.

TR Property Investment said that portfolio turnover totalled £477 million in the year, less than £549 million the prior year, and that turnover was 40% of net assets which was higher than the previous year’s figure of 36%; reinforcing the volatility in the markets.

It swung to a pretax loss of £543.7 million from a profit of £283.6 million the prior year.

The company declared a final dividend of 9.85 pence per share, bringing the total dividend to 15.50p which marked a 6.9% rise from 14.50p the previous year.

In determining the dividend, the company said it was ‘very sensitive to investor appetite for income’ but aware of the ‘potential impact of interest and exchange rates on future earnings’.

Looking forward, the investment trust said it expects to report a fall in earnings, with the impact of higher interest rates feeding through to earnings as fixed or capped debt structures come up for refinancing.

‘Macro considerations continue to dominate. Markets have had to absorb a huge adjustment in the cost of capital and real estate equities have certainly borne their share of price adjustments. However, this is an unusual cycle where both rates and rents are rising,’ said Chair David Watson.

‘The sector has been hit hard and many of our companies are trading at large discounts to asset values that have also been recalibrated.’

Shares in TR Property Investment were up 2.3% at 287.50 pence in London on Friday morning.

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