GCP Student Living says returns on target

GCP Student Living says returns on target – GCP Student Living has published results for the year ended 30 June 2017. The highlights are:

• Total revenue for the year of £28.6 million.
• Annualised shareholder returns since IPO of 14.2%, in excess of the target return of 8-10%.
• Successfully raised £103.6 million through two oversubscribed placings of ordinary shares.
• Dividends of 5.75 pence per ordinary share for the period in line with target and up 1.6% on the previous year.
• EPRA NAV (cum income) per ordinary share of 139.08 pence, up 1.6%.
• Completed the acquisition of Woburn Place, London WC1, which following refurbishment ahead of the 2018/19 academic year, is expected to provide c.420 beds.
• At 30 June 2017, the portfolio comprised eight student accommodation assets, primarily in and around London, with c.3,000 beds which were either operational or expected to complete construction or refurbishment over the next two academic years. The portfolio valuation at that date was £634.6 million.
• On 16 September 2016, the company completed its Migration to a premium listing on the Official List of the UKLA. Trading in its ordinary shares was transferred from the SFS to the Premium Segment of the Main Market of the LSE with effect from that date.
• During the period, the company was admitted by the FTSE Group to the FTSE All Share and FTSE EPRA/NAREIT Global Real Estate indices, which, they say, has broadened the company’s appeal to a wider range of investors.
• Post year end, their first forward-funded development at Scape Wembley, London was completed on schedule for the 2017/18 academic year, providing a further c.580 beds and they completed on the acquisition of Circus Street, Brighton which is expected to provide 450 beds and 30,000 sq ft of commercial space for the 2018/19 academic year.

They say that their properties continue to benefit from the supply/demand imbalance for high-quality, modern student facilities in London, with all properties fully occupied and rental growth of 3.9% for the 2016/17 academic year.

The chairman, Robert Peto, said: “I am pleased to report a year of continued positive performance. The Company has grown its dividend to 5.75 pence per ordinary share in respect of the year and delivered annualised total returns since IPO in 2013 of 14.2%, exceeding its long term target of 8-10% per annum.

The Company’s core focus on student residential accommodation assets located in and around London, where, at the year end, 97% of the value of the portfolio was located, coupled with conservative levels of borrowings, provides shareholders with a portfolio of properties which benefit from strong supply and demand characteristics, which is the primary driver of rental growth in the sector and underpins the Company’s attractive income characteristics.

The two oversubscribed capital raises over the period are a reflection of the strong ongoing support for the Company’s investment mandate by new and existing investors alike, with admission to the FTSE All-Share and EPRA/NAREIT Global REIT indices further broadening the Company’s appeal.

Demand from overseas students for private student residential accommodation in the Company’s core market is likely to remain resilient relative to the rest of the UK given the attractions of London as a cosmopolitan, global centre of academic excellence. The Company continues to deliver on its objectives and its portfolio remains well positioned to provide shareholders with regular, sustainable dividends that should continue to grow over the long term.”

DIGS : GCP Student Living says returns on target