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Trading update
Estimated 100% increase in gross income from Osprey residential portfolio

15 May 2017

K&C REIT plc (AIM: KCR), the residential real estate investment trust group, is pleased to provide an update on its trading and operations in its Osprey portfolio.

Highlights

  • Following K&C's active management over the first 12 months of ownership of the Osprey residential portfolio:
    • year-on-year turnover from this portfolio is projected to more than double
    • year-one return (net of operating costs) on cash investment is expected to be 15 per cent

K&C (Osprey) Limited

The Company is pleased to report that, since acquiring the Osprey freehold retirement portfolio in May 2016, the asset has outperformed expectations, generating a return after operating costs of 15 per cent on the cash invested in the first 12 months since acquisition.  Osprey's revenue has more than doubled compared to the previous twelve-month period under its previous ownership, following active management that includes significantly improved marketing activities.

The Osprey portfolio was acquired for £1.6m, including three million ordinary shares at 10p per share.  The portfolio consists of 254 flats, 79 houses and 13 commercial units, of which K&C owns the freehold of 159 flats and 13 houses.  Since acquisition, K&C has made significant improvements to how the Osprey portfolio is managed, which has led to a much-improved asset performance. The Company is also looking at opportunities to acquire property leaseholds within Osprey in order to build further value and generate yield. 

Strategy

K&C is continuing to broaden its activities in the residential space.  The Company is looking at a number of opportunities to significantly extend its portfolio within this area which will support its target of delivering growth in net asset value and providing a sustainable, long term dividend yield.

Dominic White, Chief executive, commented: "The performance of the Osprey portfolio, since its acquisition, demonstrates K&C's ability to identify opportunities within the residential sector and significantly enhance asset performance through improved management and strategy.  The Company is currently looking at several targets across the residential space where it believes it can deploy its skills to boost yields, and looks forward to updating the market in due course."

 

Contacts:

K&C REIT
Dominic White, Chief executive
Tim James, Property director
info@kandc-reit.co.uk
+44 20 3793 5236
+44 7768 833 029
Stockdale Securities (nominated adviser and joint broker)
Antonio Bossi / Robert Finlay / El Hanan Lee
+44 20 7601 6100
Peterhouse Corporate Finance (joint broker)
Lucy Williams / Heena Karani
+44 20 7469 0933
Yellow Jersey PR
Charles Goodwin / Katie Bairsto
+44 7747 788 221

 

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

Notes to editors:

K&C's objective is to build a substantial residential property portfolio that generates secure income flow for shareholders through the acquisition of SPVs (Special Purpose Vehicles) with inherent historical capital gains. The Directors intend that the group will acquire, develop and manage residential property assets in London and other key residential areas in the UK.

 

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