Our objectives and strategy

Our objectives

We aim to provide shareholders with an attractive total return, underpinned by secure income.

Total accounting return

Target

10% per annum, through a combination of dividends and growth in NAV.

12 months to 31 March 2023

(25.7)% total accounting return for the 12 months ended 31 March 2023

Dividends

Target

6.4 pence for the year ending 31 March 2022

As at 30 September 2023

Paid or declared dividends of 6.4 pence per share in respect of the 12 months ended 31 March 2023 in line with the target for the financial year

Sustainability

Our new environmental performance target is a 4.2% annual reduction in our like for like scope 1 and 2 emissions.

Our strategy

To achieve our objectives, we follow the strategy set out below:

Investment strategy

We look for

sites close to major transport links and large conurbations, with high occupier demand and a suitable workforce;
buildings or land with a range of uses and long-term flexibility, including the potential to change permitted use;
assets that match occupiers’ current and future needs, including their ESG objectives; and

multi-let estates spread risk and offer more asset management opportunities than single-let assets. Rental increases can also be reflected across the estate. We generally target buildings of less than 100,000 sq ft and have an average size of 12,000 sq ft.

Asset management strategy

We budget to spend 0.75% of our gross asset value (“GAV”) on capital expenditure each year, with a target return of at least 10%. We also target a vacancy level of 5-7%, since vacant properties allow us to carry out asset management activities.

Improving the sustainability performance of our assets, for example by improving their energy efficiency, is an important part of maintaining property values and occupier appeal.

Financial strategy

We fund the business through shareholders’ equity, bank debt and any disposal proceeds we generate. We look to raise equity at times when we can make investments that are accretive to shareholders.

Our strategy for debt financing is to maintain a prudent level of debt, with an LTV range of 30‑40% in the longer term. We look to hedge the interest on a significant proportion of our debt, to provide greater certainty over our financing costs.