The PRS REIT, the vehicle set up to create a portfolio of newly-built rental homes, is on course to commit £900m to development by early 2019, it said today, issuing both its maiden full-year results and a Q1 trading update.
In the results covering the 13 months to 30 June 2018, PRS REIT committed £685m, since when a further £71m has been committed to development. In total, the portfolio covers 5,100 homes to date.
A second equity placing in February this year saw a further £250m raised, equalling the sum raised in the initial public offering. Debt facilities of £250m were secured in June, and the group said that additional debt facilities of £200m are under discussion.
PRS REIT, set up by Sigma Capital and based out of Sigma’s Manchester office, reported profit after tax of £3.2m, reflecting an operating profit of £2.7m. Net rental income generated in this first year was £1.5m. The dividend target of 5p per share was achieved. Net assets at 30 June 2018 stood at £486m.
As of 30 September, 595 homes have been completed, generating £5.7m per year. The total rental value of completed, contracted and committed development combined is £47.1m.
The PRS REIT said that over and above the £900m committed or earmarked, a further £689m of opportunities have been identified.
Sigma subsidiary Sigma PRS Management acts as Investment advisor to the REIT, with properties delivered through Sigma’s PRS platform, with the support of partners including Countryside Properties, Engie, Keepmoat, Galliford Try and Homes England.
Chairman Steve Smith said: “We have performed well over our first thirteen months of trading and, while there were some site-specific delays in the period, we are pleased with overall progress. About £756m of our funding resource has now been committed to the delivery of new rental housing, which represents some 5,100 new homes.
“Of this, 595 homes are completed and let, approximately 2,000 are under construction, and the balance is due to start construction after procurement processes have been completed.
“Our access to land and development opportunities is one of our key strengths, and we remain on track to have committed £900m – our full resource when additional gearing is included – to sites early in 2019.
“The rental market for family homes remains especially undersupplied and we have experienced strong demand for our professionally-managed family housing. Overall, therefore, we believe that the Company is in an extremely good position to deliver our planned programme of new family homes, and to prosper as the UK rented housing sector continues to grow.”