Home REIT Sells A Further 153 Properties At 65% Loss

In a stock exchange notice today (9 November), the embattled trust said the sales, which comprise 6.5% of its portfolio by number, were for a total value of £24.3m, representing an average of 35% of their purchase price.

The trust said the sold properties were identified as being in "poor condition", largely vacant and requiring significant capital expenditure to meet the required standards. Completion of the sales is expected in a month's time.

Home REIT sells 14 properties at average 49% loss as inspections prolonged

In total, the trust has now exchanged contracts for the sale of 344 properties for £60.8m. The first auction in early August delivered a 60.6% loss, while the value of the second sale at the end of September represented an average of just 32% of the properties' purchase price.

On Monday (6 November), Home REIT said it had exchanged contracts for 14 properties for a value of £8.9m, representing a 49% cut to the purchase price.

The proceeds of the sales will be used to reduce the trust's borrowings and provide working capital, as part of investment manager AEW's strategy to stabilise the portfolio. 

As at 31 October, Home REIT had total borrowings of £216.2m, comprising a £116.2m interest-only term loan, repayable in 2032, with a fixed all-in rate of 2.07% per annum, and a £100m interest-only term loan, repayable on 2036, with a fixed all-in rate of 2.53% per annum.

AEW re-tenants 10% of Home REIT portfolio as rent collection falls to 3%

The trust had cash balances of £15.3m, including amounts held on account with its lender, Scottish Widows, and subject to certain restrictions regarding its availability. In total, Home REIT had £2.7m of unrestricted cash.

Earlier this week, the board of the trust, whose shares have been suspended for nearly a year, said it currently anticipates publication of the outstanding accounts in early 2024. The publication of the accounts is a prerequisite for the restoration of trading.

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