Industrial property specialist Hansteen's key indicators have all been heading in the right direction in the second half of the year.
Cash flow has been strong, with normalised income profit continuing to grow in line with the board's expectations, while absolute and like-for-like occupancy and rental income on the wholly owned portfolio have all improved.
The group said the industrial property market is starting to unclog, particularly in Germany, enabling the group to get shot of 13 properties in the second half of 2012, raising £17.8m.
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That money and more has been recycled into £26.4m of property acquisitions with a combined annual rent of £2.4m. So far, these acquisitions are performing in-line with, or better than, Hansteen's projections at the time of acquisition. In addition, the group has committed £13.6m to two substantial pre-let developments in Germany which will, on completion, produce running yields of around 10%, from strong tenants on long leases.
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"We are seeing an increasing number of interesting acquisition opportunities in all of our core regions. Acquisition opportunities in this market take a long time to conclude and are often complex but there has recently been a noticeable increase in such discussions in all of our geographic regions and in several situations we are in detailed due diligence albeit this is no guarantee that a deal will be consummated," the company's interim management statement said.
"The portfolio and the business should continue to generate high and growing returns over the next few years which is expected to manifest itself in a progressive, but prudent, dividend distribution," the company added.
JH
