Shares in real estate investor LondonMetric Property (LMP) gained 1.5% to 185.5p as it updated on trading, confirmed it would pay a dividend and announced plans to raise £100m to fund acquisitions.
CEO Andrew Jones says: ‘These uncertain times are starting to give rise to quality investment opportunities that are seldom available in a normalised market.
‘Through our occupier relationships we have identified some excellent assets, at attractive pricing, which would further strengthen our portfolio's long term income characteristics.
‘Not only do we expect to see further opportunities arise but also we expect the pitch to be much less crowded than before.’
LondonMetric said it expected to report a rise in earnings for the year to 31 March 2020, but a slight fall in net asset value amid costs related to its acquisition of A&J Mucklow.
EPRA net asset value per share was down to 172p from 175p year-on-year, after deducting 2.5p of costs relating to the A&J Mucklow deal.
EPRA earnings per share were expected to rise 24% to 9.3p on-year, driven by a 24% increase in net rental income to £116m.
The company said its dividend for 2020 was expected to be 8.3p, up from 8.2p last year, with a fourth quarterly dividend of 2.3p per share expected to be declared with its 2020 results in June.
LondonMetric, which specialises in industrial and logistics assets such as warehouses, said 92% of rental payments due by 1 April had been collected or were being collected monthly.
Commenting on the fundraise, Jefferies analyst Mike Prew said: ‘The current market conditions are seeing increased opportunities to acquire assets let to high-quality tenants.
‘Notably, Next (NXT) has been selling and leasing back distribution assets and its head office to create liquidity and cash to ride out the COVID-19 disruption.
‘LMP's equity placing is sensible for opportunistic acquisitions while also containing gearing, which has crept higher to 37.7% or 35.9% after completion of exchanged disposals and will likely leave LTV (loan to value) in the low 30s per cent.
‘Prior to the raise, LMP was in a strong solvency position with £220m of cash and undrawn facilities available.’
