Yew Grove reports first pretax profit as portfolio triples in size

Property reit Yew Grove generated a pretax profit of €2.3 million between April and December last year.

In its maiden set of results, the company said it had now fully invested the €75 million generated from its IPO last June.

The firm specialises in office and industrial properties primarily outside Dublin’s central business district that can be leased to State entities and State-backed firms.

As of December 31st, its portfolio was valued at €77.9 million, which represented a year-on-year value gain of €1.6 million.

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Last year Yew Grove grew its portfolio to 18 buildings in 14 properties. This includes 12 buildings in the 10 seed portfolio properties acquired at the time of the IPO.

The company said it had effectively tripled the size of its property portfolio since the IPO in June, and the valuation gain recorded for the period represented “a significant achievement” given the current market assumptions and the associated costs of commercial property investments here.

Construction

In July, the group acquired two office buildings – Building One and Three Gateway – on East Wall Road, just north of the Dublin docklands for €29 million.

In October, it purchased the Blackwater House in Mallow for €1.85 million while in November it agreed terms with IDA Ireland and a tenant in its Athlone property to acquire land and begin construction of a car park adjacent to that property.

And in December, it completed the acquisition of three buildings, on an IDA park outside Letterkenny in Donegal, for an aggregate purchase price of €16 million. The Reit's annualised rent roll stood at €6.3 million as of the end of last year.

“On current trends, demand for office space is increasingly being driven by the requirement from multinationals for large footplate, grade A or modern space,” it said.

In line with previous guidance, the company’s board said it was proposing an interim dividend for the period of 0.964 cents per share. It said its Net Asset Value (NAV) per ordinary share increased by 3.6 cents to 100.18 cents at the end of 2018.

Delighted

"We are delighted to announce that by the end of the year the company had invested all of the net proceeds raised in our IPO," chief executive Jonathan Laredo said.

“The fact that this was achieved despite the company absorbing all of the costs of flotation and tripling the size of its property portfolio is a testament to the quality of those purchases,” he said.

“The headroom under our revolving credit facility will allow the company to buy further attractive properties and continue to improve returns to shareholders,” he added.

“The current strong rental levels in our geographic target market support a growing dividend and, as previously disclosed, the company will announce its first quarterly dividend at the end of March,” Mr Laredo said.