Segro asset value hit by write-downs
SEGRO, the industrial property developer, said that it was hit by a 9.6 per cent decline in its net asset value (NAV) last year after bigger-than-forecast write-downs on its portfolio.
The real estate investment trust said its NAV per share fell to 340p after the group wrote down the value of its non-core assets by £187m. Analysts had been expecting a write-down of around £160m.
Segro announced plans in November to focus its UK multi-let industrial portfolio on London and south east and dispose of non-core assets across Europe worth about £1.6bn over the next three years.
Analysts said the increase in write-downs reflected the difficulty to sell the six larger assets in the portfolio.
The group completed the sale of five smaller UK assets yesterday to Ignis Asset Management for £80.2m, adding to the £111m sales completed in 2011.
“We have got a number of negotiations ongoing so we expect to be able to make £300-500m of disposals this year,” chief executive David Sleath told Morning Wire
On the operational side, the picture was brighter. Sleath said void rates fell below 10 per cent for the first time in four years, from 10.2 to 9.1 per cent in the fourth quarter of 2011.
Underlying pre-tax profit rose 8.8 per cent to £138.5m while earnings per share rose 7.6 per cent to 18.4p.