Abrdn Property Income Trust Limited · LSE:API
Abrdn Property Income Trust — Shareholder Meeting (June 2023)
27 slides from Abrdn Property Income Trust's shareholder meeting presentation, June 2023
Slide 1: abrdn Property Income Trust (API) – AGM Presentation
abrdn Property Income Trust (API) – AGM Presentation Presented by Jason Baggaley – Fund Manager Mark Blyth – Deputy Fund Manager June 2023
Slide 2: Contents
Contents 01. API Team 3 02. 2022 Review 5 03. 2023 Expectations 12 04. API Environmental, Social and Governance 18 05. API Conclusion 22 06. Appendices 24
Slide 3: API Team
API Team 3 | abrdn.com
Slide 4: API Team
API Team Experienced and dedicated fund management team with expert support Independent Board Research and Name Role Strategy team RE ESG* Team Supported Research / underwriting by centralised ESG team, • Global macro providing strategic direction to Jason Baggaley Fund Manager • Quarterly real esta
Slide 5: 2022 A review of the year
2022 A review of the year 5 | abrdn.com
Slide 6: 2022 API Summary
2022 API Summary Year of two halves reflected rapid repricing, particularly within the industrial sector Margin over Gilts/Swap rates: All Sectors NAV as at 31 December 2022 84.8p 8% • H1 2022 NAV increase 9.6% 7% • H2 2022 NAV decrease 23.4% • 2022 NAV total return -12.8% 6% 5% 4% Share price Total
Slide 7: 2022 API Summary
2022 API Summary Focussed on providing a sustainable income • 2022 rent collection 98.9% Property Total Return • Occupancy Rate 90.2% 25% NAV Return • Share Buybacks £12.4m 20% Fund (ex cash) • 6 Rent Reviews settled securing an additional £237,560 p.a. 15% MSCI UK • Average increase of 11% on previ
Slide 8: API Share Price
API Share Price Share price continues to trade on a discount, as sector remains out of favour API NAV vs Share Price API discount vs Peer Group 20.0 1.20 10.0 1.10 1.00 0.0 0.90 -10.0 0.80 pence per share -20.0 0.70 -30.0 0.60 -40.0 0.50 0.40 -50.0 0.30 -60.0 API Share Price API NAV API Discount Pro
Slide 9: Identifying structural changes
Identifying structural changes Industrial transactions – improving quality to maximise future income potential Constant review and active management of the portfolio • Purchase: Glass Futures, St Helens (December 2021 – PC April 2023) • Funding of a new, high-specification unit pre-let to the local
Slide 10: Identifying structural changes
Identifying structural changes Office sales - repositioning the portfolio • Concern around office sector prompted asset review • Higher risk assets and those not deemed “future-fit” identified • Market liquidity reduced during and post-Covid, but early action taken • 6 assets sold, reducing office s
Slide 11: API debt refinancing
API debt refinancing Debt Maturity April 2023 – refinance completed October 2022 Existing Debt Facility • Expires April 2023 New Debt Facility: • Lender: RBSI • Lender: RBSI • 3-year tenor • Term Loan: £110m • Margin: 150bps (on both term loan and RCF) • Term Loan: £85m • Term Loan all in cost: 2.72
Slide 12: The year so far and what we are focussed on
2023 The year so far and what we are focussed on 12 | abrdn.com
Slide 13: Sectors value movements continue to diverge
Sectors value movements continue to diverge Valuations stabilising, with all sectors barring Offices showing positive capital value growth in March • Industrial: Following significant value falls through the latter half of 2022, Industrial values have started to stabilise. Sector fundamentals remain
Slide 14: 2023 API Update
2023 API Update Maintaining strong asset management momentum API Portfolio allocation by Sector • 2023 rent collection 97% • 3 Rent Reviews settled securing an additional £178,549 p.a. • Average increase of 30% on previous passing rent • 6 Lettings (including Agreements for Lease) securing rent of £
Slide 15: API Rental Income
API Rental Income Significant rental income growth available from existing portfolio RPI: Retail Price Index; CPI: Consumer Price Index; OMV: Open Market Value * Includes Agreement for Lease at Washington ** Includes pre-let development in St Helens *** Speculative development assets Source: abrdn,
Slide 16: API Portfolio Occupation
API Portfolio Occupation Occupation Rate 90.2% Vacancy Rate 9.8% (4.6% including contracted lettings) Area (Sq m) ERV ERV % Occupied 297,542 £ 29,416,283 87.7% Vacant 25,678 £ 3,290,410 9.8% Strong letting momentum in Q2 Birmingham, 54 Hagley Road 3,510 £ 842,000 2.5% • 54 Hagley Road, Birmingham: W
Slide 17: Recent Purchase – Welwyn Garden City
Recent Purchase – Welwyn Garden City Acquired: March 2023 Property Opportunities • Description: Morrison’s supermarket • Committed tenant improvement works are targeting a “B” EPC • Size: 58,953 sq.ft • Strong trading store, with a good specification and catchment • EPC: C • Restricted planning regi
Slide 18: API ESG
API ESG 18 | abrdn.com
Slide 19: Energy Performance – Changing Regulatory Environment
Energy Performance – Changing Regulatory Environment API EPC Exposure: % Estimated Rental Value (ERV) • “E” and “G” rated assets are mostly in Scotland, where there is a EPC Rating Mar 2023 Dec 2022 Dec 2021 different regime with no current timescale for achieving specific ratings A 6% 4% 2% • “A” b
Slide 20: Environmental Social and Governance – Putting Theory into Practice
Environmental Social and Governance – Putting Theory into Practice ESG is embedded in all decision-making on API Latest update: Photo voltaic (PV) and electric vehicle (EV) projects progressing • 10 operational PV installations, having already produced nearly 3 million kWh of power • 5 systems broug
Slide 21: Environmental Social and Governance – Putting Theory into Practice
Environmental Social and Governance – Putting Theory into Practice Pilot Study – Natural History Museum & EY API has formed a partnership with EY and the Natural History Museum (NHM) to pilot the museum’s Biodiversity Intactness Index (BII) at Far Ralia. The BII is a science-based assessment of an a
Slide 22: API Conclusion
API Conclusion 22 | abrdn.com
Slide 23: Summary
Summary API’s aim is to provide an attractive income to investors with the prospect of income and capital growth • Following the significant repricing of Q4 2022, Q1 2023 has seen a slowing in the capital declines • Despite the large capital value falls experienced in 2022, the industrial occupation
Slide 24: Discrete Performance
Discrete Performance To 31 March 2023 2023 2022 2021 2020 2019 Direct Portfolio Return (13.94) 24.82 5.99 (1.18) 7.70 NAV Total Return (19.61) 30.63 6.80 (3.78) 7.37 Share Price Total Return (33.50) 48.71 (23.52) (0.67) 5.74 MSCI Benchmark (12.60) 19.49 1.21 (0.43) 4.55 Objective To provide an attra
Slide 25: Important Information
Important Information Risk factors you should consider prior to investing: • The value of investments and the income from them can go down as well as up and investors significant proportion of leases may be re-let at rental values lower than those prevailing under may get back less than the amount i
Slide 26: Important Information
Important Information The MSCI information may only be used for your internal use, may not be reproduced or re- disseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute inves
Slide 27: Important Information
Important Information Past performance does not predict future returns. The value of investments, Party Data relates. and the income from them, can go down as well as up and clients may get back less than the amount invested. * abrdn means the relevant member of abrdn group, being abrdn plc together
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