Green Reit sees Brexit leases being signed by end of year

Company’s net asset value rises 4.2% on higher rent roll

 

Property investor Green Reit expects to see businesses moving to the Republic following Brexit to begin signing leases on premises by the end of the year.

The total value of the real estate investment trust’s properties rose 5.4 per cent to €1.31 billion in the final six months of last year as its rent roll increased and it continued to develop office and industrial property.

Net asset value, measured on a basis set out by the European Public Real Estate Association (EPRA), rose to €1.582 billion before the payment of a final dividend in November, the company said.

Stephen Vernon, who chairs the trust’s investment manager Green Property Reit Ventures, said both the firm itself and the Republic’s property market should benefit once the UK begins its exit from the EU in earnest this year.

Banks and other financial services firms that want to keep some operations within the EU are known to be considering moves to Dublin amongst other EU cities.

Mr Vernon said the extent to which this was likely to happen would become clearer in the coming months as the UK invoked article 50 of the European treaties and formally begins to leave the EU. “By the end of the year you will probably see some leases signed in relation to Brexit.”

Extra demand

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It said earnings per share on an EPRA basis rose 37 per cent to 2.6 cents as annual rent across 21 properties rose 6.2 per cent to €65.1 million.

Green Reit and rival Hibernia Reit launched initial public offerings in 2013 to raise cash to buy commercial property and take advantage of depressed prices after the crisis.

During 2016, Green Reit completed the letting of its first office development at 32 Molesworth Street in central Dublin, with financial firm Maples Fund Services having agreed in December to rent the entire 2,973sq m (32,000sq ft) property for €1.65 million a year.

The trust said three other office schemes it was working on were “progressing well, with an increased level of interest from prospective tenants”.

Good momentum

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“We remain confident that this development pipeline will enhance both the net asset value of the company and its rental income, thereby feeding into a strengthening dividend from our rental profits in the future,” Green Reit said.