RNS Number : 0724R
Stenprop Limited
25 October 2019


(Registered in Guernsey)

(Registration number 64865)

LSE share code: STP    JSE share code: STP


("Stenprop" or the "Company")




25 October 2019


Stenprop, the UK multi-let industrial property company, today publishes a trading update for Q3 2019, the period from 1 July 2019 to 30 September 2019.


Continued leasing success and significant rental growth


Multi-let industrial (MLI) portfolio lettings:


-       We completed 22 new lettings and 9 lease renewals generating £ 648,142 of contractual income over 104,633 sq ft.  The average rental uplift on the previous passing rent was 21% on new lettings (Q2 2019: 24%) and 19% on lease renewals (Q2 2019: 16%). The average rental incentive given across all new lettings and renewals was 2.5 months on a 5.08-year average term

-       The average rent on the MLI portfolio is now £5.14 /sq ft (Q2 2019: £5.08/sq ft), reflecting a 1.2% increase in passing rent from the previous quarter. The current passing rent is 7.8% below the average estimated rental value of the portfolio of £5.57/sq ft (Q2 2019: £5.50/sq ft)

-       The vacancy rate stands at 6.1% (excluding the space currently under refurbishment at Coningsby Park, Peterborough), up from 5.5% as at the end of Q2 2019.

-       The most significant transactions completed were a letting of 27,000 sq ft at Compass Industrial Park in Liverpool on a five-year term with three months' rent free and a letting of 21,000 sq ft at Eurolink 31 in Wakefield for a 10-year term with three months' rent free

Attractive MLI acquisitions

-        We acquired eight MLI estates for an aggregate purchase price of £23.9 million, reflecting an average capital value of £75/sq ft:

·    comprising 317,923 sq ft with an average occupancy rate of 92% and 89 tenants; and

·    providing an additional £1.6 million of rental income, averaging £5.54/sq ft

-        We acquired the freehold interest in a 3,000 sq ft unit on our existing Holbrook Enterprise Park, Sheffield, further consolidating our ownership of the estate




Non-MLI portfolio performs in line with business plan


-       We completed six lettings, totalling 34,421 sq ft, which will provide total annual rent of £380,655; the average term on the new lettings was 5.2 years

-       The vacancy rate stands at 1.0%, down from 1.2% as the end of Q2 2019


Paul Arenson, CEO of Stenprop, said:


"The MLI occupational market remains strong with demand outstripping supply. Lease incentives remain limited and we are realising significant rental uplifts when leases are renewed. 


"We have also had a good quarter of individual MLI acquisitions after an unusually quiet start in the first quarter of the financial year.  There was marginally less competition in the market over the period, largely as a result of the UK's political instability.


"Finally, we continue to make progress on the development and implementation of our Industrials operating platform. Over the quarter we commenced a substantial upgrade of our financial and customer engagement systems, which we expect will deliver material cost and efficiency gains in due course, as well as supporting our serviced-industrial business plan".


Stenprop is continuing its transition into a focused UK MLI company, with the aim of becoming the UK's leading MLI business. Stenprop has set out a transition plan which involves transitioning the portfolio to at least 60% MLI and reducing overall leverage to a loan-to-value (LTV) ratio of no more than 40% by March 2020, with the plan to transition to 100% MLI over the following 12 to 24 months.


At 30 September 2019, MLI comprised 45%1 of Stenprop's portfolio and the LTV was 42%1. When unrestricted cash is added to this measure the overall LTV was 39%2.


The financial information on which this trading update is based has not been reviewed or reported on by the Company's external auditors.


1.    These figures are based on our 31 March 2019 valuations adjusted for subsequent acquisitions and disposals and changes in foreign exchange rates.

2.    Calculated as gross borrowing less unrestricted cash, divided by gross asset value based on our 31 March 2019 valuations adjusted for subsequent acquisitions and disposals and changes in foreign exchange rates.




For further information:

Stenprop Limited                                                                                        44(0)20 3918 6600

Paul Arenson

Julian Carey

James Beaumont


Numis Securities Limited (Financial Adviser)                                       44(0)20 7260 1000

Hugh Jonathan

Vicki Paine   


Tavistock (PR Adviser)                                                                               44(0)20 7920 3150

James Whitmore

James Verstringhe


Java Capital                                                                                                  27 (0)11 722 3050

(JSE sponsor)            


About Stenprop:

Stenprop is a Guernsey-registered UK REIT. The objective of the Company is to deliver sustainable growing income to its investors. Stenprop's investment policy is to invest in a diversified portfolio of UK multi-let industrial (MLI) properties with the strategic goal of becoming the leading MLI business in the UK. For further information, go to www.stenprop.com.



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