London-focused property regeneration specialist Quintain Estates said its balance sheet is looking in a much healthier state following an influx of cash from disposals.
The group has pocketed £90m in cash since April 1st as it offloaded a couple of assets and received a payment from its joint venture partner on the Greenwich peninsula regeneration project. A further £54m is due to roll into the firm's coffers in August, following the completion of the iQ Shoreditch student scheme, of which £24.5m will be used to meet final development costs. After receiving the net proceeds from iQ Shoreditch, on a pro-forma basis gearing (for banking covenant purposes) will reduce from 87% at the year end (March 31st) to around 75%.
"This increases further the financial strength and flexibility of the company as we seek to benefit from our extensive exposure to the resilient London market," said Max James, Chief Executive of Quintain.
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The group's specialist property asset management business, which focuses on student accommodation, healthcare and London's West End property market, has had a good start to the financial year, the company said.
The iQ Fund, a 50-50 joint venture with the Wellcome Trust, saw rental levels across the portfolio for the 2012/3 academic year up 5.5% on average than last year and, at 88%, while like-for-like lettings are in line with the same stage of the marketing cycle in 2011/2.
The Quercus fund, which is focused on the healthcare sector, saw a marginal quarter-on-quarter improvement as a result of the recommencement of rental payments from homes formerly let to Southern Cross, the collapsed operator of care homes.
Shares in Quintain Estates & Development were up a halfpenny to 50p following the interim management statement, having hit a new 52-week high of 52.5p at one stage of the morning.
JH
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