£564m written off as Home REIT portfolio shrinks 58% in revaluation
The material reduction of £564m in valuation has been tied principally to a 'reassessment of the quality of assets', alongside the 'covenant strength of the tenants', many of which have entered liquidation.
According to a regulatory update today (20 December), the portfolio of 2,473 properties as of 31 August 2023 was worth £412.9m, a reduction of £564.1m (57.7%) from the unaudited historical acquisition costs, excluding purchase costs.
The update comes following the «substantial completion» of Jones Lang LaSalle's (JLL) external inspections, which has so far covered 2,391 (97%) of the trust's portfolio, however just 1,079 properties have been inspected internally.
Rent collection dwindles to 14% as further Home REIT tenant enters liquidation
Of these, 195 have been inspected by JLL, with 884 internal inspections carried out by Vibrant Energy Matters, which was appointed on 28 July 2023 to «inspect all properties and report on condition».
Combined with the preliminary findings of Vibrant and Countrywide Surveyors, which was appointed on 28 July 2023 to «provide building surveys in respect of required repairs and refurbishment on a selection of… properties», JLL has issued Home REIT with its draft valuation reports of the portfolio.
The material reduction of £564m in valuation has been tied principally to a «reassessment of the quality of assets», alongside the «covenant strength of the tenants», many of which have entered liquidation.
As such, 88% of the portfolio was based on a vacant possession basis as of 31 August 2023, and where properties were valued on an «investment basis», limitations on the duration of income streams and the rent levels have been applied.
This was a severe reduction from the valuation report's
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