Growing portfolio pays off for Atlantic Leaf Properties

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Atlantic Leaf Properties  has grown its assets under management, from £270m at the end of May 2016 to £303m at the end of May 2017. [ FILE PHOTO] Atlantic Leaf Properties has grown its assets under management, from £270m at the end of May 2016 to £303m at the end of May 2017. [ FILE PHOTO]

The injection of a substantial property portfolio into JSE-listed Atlantic Leaf Properties the past years is paying off.

The Mauritian-based real estate company that invests in light industrial nodes in the UK, says it has grown its assets under management, from £270m at the end of May 2016 to £303m at the end of May 2017.

CEO Paul Leaf-Wright said the group had timed its entry into light industrial real estate well in a competitive market.

"We entered the market at a clever time. The market was at a weak point and we saw the potential in light industrial properties," said Leaf-Wright on the sidelines of the release of the group’s financial results for the quarter to May. 

"These results reflect a solid performance for the quarter where the company achieved its forecast earnings target and is on track for the full-year forecast distribution of 9p.

"Our focus remains firmly on the UK, which still presents numerous good opportunities for us to consider. Notwithstanding the elections and Brexit talks, we see occupier and investment demand. 

Income and capital growth continue to show value in the industrial and logistics sectors," he said.

The company’s portfolio consists of 48 properties, each of which has long-term single-tenant leases with blue-chip occupiers, with an average yield of 7.3% and an average lease term of about 11 years.

Atlantic Leaf’s chief investment officer, Shaun Fourie, said that although no new acquisitions had been made in the reporting period, the group continued to see significant activity in the UK property market.

Paul Duncan, an investment manager at Catalyst Fund Managers, said that Atlantic Leaf had assembled a reasonable portfolio, although its external management structure meant management and shareholders’ incentives were not necessarily aligned well enough.

"Investors have always had negative experiences with such corporate structures," he said.

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Listed Property / REITs  |  United Kingdom Property Market  |  Paul Duncan  |  Atlantic Leaf Properties  |  Paul Leaf-Wright
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