Standard Life Investments

Standard Life Investments Property Income Trust Limited

Mex ID: ITSLI SEDOL: 3387528 Reuters: SLI.L

Price
89.50
NAV
83.90
Premium/(Discount)
6.67%
Daily Price Change
-0.25p (-0.28%)
Change date
21/08/2017

Figures above are updated every business day after the close of trading and those displayed are to the close of the previous business day. Figures are shown in pence (GBP) and the data is provided by, and copyright @2016, FE.

General Trust Information

Objective

The companies investment objective is to provide Ordinary Shareholders with an attractive level of Income with the prospect of income and capital growth.

Profile

The companies investment objective is to provide Ordinary Shareholders with an attractive level of Income with the prospect of income and capital growth.The fund will acheive the investment objective by investing in a diversified fund consisting of UK commercial properties. The majority of the portfollio will be invested in direct holdings within the three main commercial property sectors of retail, office and industrial.

Fund Manager

Jason Baggaley

Jason Baggaley

Jason Baggaley, a qualified chartered surveyor, joined Standard Life Investments in 1996 and has over 17 years of real estate fund management experience. In addition to managing the Standard Life Investments Property Income Trust Limited, Jason also manages two major segregated property funds offering strong performance track records.

Awards

Moneywise Investment Trust Awards 2017 – Property Direct UK - Standard Life Investments Property Income Trust.

What Investment – Best Investment Trust for Income – Standard Life Investments Property Income Trust

Performance

Trust Performance (on a bid to bid basis)

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Past performance is not a guarantee of future returns. The value of investments may go down as well as up and you may receive back less than you invested. Your capital and income is not guaranteed.

Trust Performance & Returns

(on a bid to bid basis)
Fund performance
Sector performance
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Fund performance
Sector performance

Past performance is not a guarantee of future returns. The value of investments may go down as well as up and you may receive back less than you invested. Your capital and income is not guaranteed.

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Monthly Valuation

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Performance (on a bid to bid basis)

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Trust Performance(on a bid to bid basis)

(on a bid to bid basis)
Fund performance
Sector performance
 Last 1 month*Last 6 months*Last 1 year*Last 3 years*Last 5 years*
Fund performance
Sector performance

Past performance is not a guarantee of future returns. The value of investments may go down as well as up and you may receive back less than you invested. Your capital and income is not guaranteed.

* Values to -

** n/a indicates that fund performance information is not available for this period due to the date the fund was launched.

Current details

All prices displayed in p (GBP). Figures below updated at 05:30 pm. Figures are provided by, and copyright @2016, FE on a delayed basis.
EPIC code:SLI
Market sector:IT Property - Direct UK
Mid price:89.5000
Bid price:89.5000
Offer:90.5000
Opening price:90.0000
Daily high:91.0000
Daily low:89.2500
Previous day's close:89.7500
Daily change:-0.2500 (-0.28%)

LSE Announcements

Video

Jason Baggaley talks about investment trusts in general, the specifics around the Property Income Trust he manages and gives a short-term outlook for the asset class.

SLI Property Income Trust

How to Invest

How to Invest

Shares in Standard Life Investments' range of investment trusts are listed on the London Stock Exchange. As with any public quoted company, investment trust shares can be bought and sold on the stock market. This can be done through directly through a platform provider such as Standard Life or via a stockbroker, financial adviser or wealth manager.

We recognise professional financial advice is important before taking any investment decision. We recommend investors seek financial advice before taking any decisions. If you'd like to find an adviser in your area, take a look at www.unbiased.co.uk.

Alternatively, there are a number of platform providers who offer an online ‘execution only’ service, some of these are listed below.

You should note that by clicking any of the above links, you will leave Standard Life Investments' website and go to another website. We are not responsible for the content or accuracy of external websites.

The value of investments and the income from them can go down as well as up and is not guaranteed; an investor may get back less than their original investment.

Insight

The key to real estate investing in an uncertain world

June 2017

Property funds have bounced back from a sharp sell-off following the EU referendum, and sentiment and returns in the sector have improved despite the lingering political uncertainty. Furthermore, the sector continues to provide an elevated yield compared to other assets.

Development continues to be relatively constrained by historic standards and existing vacancy rates are below long term average levels, which should all help to maintain the positive returns the sector is currently recording. In this environment, the steady secure income component generated by the asset class is likely to be the key driver of returns going forward.

Emphasising the recovery, almost all investment trusts in the Property – Direct UK sector are now trading at a premium, having recovered from double-digit discounts following the ‘leave’ vote last summer. The average premium stands at 5.2% – a far cry from the sector’s 12-month discount high of 17.2%, data from Winterflood Securities shows.

In terms of sector allocation, the Standard Life Investments Property Income Trust (SLIPIT) remains tilted towards the industrial sector, which continues to benefit from supply chain reconfiguration as more goods are bought online and the favourable fundamentals of elevated demand and limited supply within the sector. In line with the ‘house view’ that advocates taking profits in the Central London market where prices have more than doubled from 2009, SLIPIT’s manager, Jason Baggaley recently exited City of London offices with the sale of the company’s then largest asset, White Bear Yard in Farringdon, for £19 million, having bought it in 2004 for £6.75 million.

‘White Bear Yard has been a wonderful investment for the company, but it was time to sell as it had increased downside risk given its location and lease profile,’ said Baggaley.

‘As a result of the sale, the company has no exposure to City of London offices and will be reinvesting into assets that offer a stronger income return with less volatile capital expectations.’

One of his recent purchases is a multi‐let industrial scheme in Bristol for £5.27 million. The eight unit property is fully let to seven tenants and provides the opportunity for asset management through lease re‐gears and renewals over the next three years.

Gavin Haynes, managing director of Whitechurch Securities, believes it to be a sensible strategy. ‘The yield on many areas of UK property is looking attractive at present versus low bond yields, but such rich valuations [as per the Cheesegrater deal] certainly provide some concerns and it seems a prudent move by Jason Baggaley of the Standard Life Property Income Trust to have exited London offices,’ he said. In an uncertain world, experienced property fund managers are focusing on the following factors:

Good quality tenants

As the source of income, tenants are reflective of the value of the property.

‘The better the tenant the more likely they will be around to pay rent each month and year,’ said Adrian Lowcock, an investment director at Architas, the multi-manager. ‘The other issue here is the vacancy rate: the lower the vacancy rate the better as it means more of your property is generating an income for longer.’

Long leases

Long leases give greater certainty over current and future income. Another approach is to buy slightly shorter leases and re-gear these to grow the income stream.

‘I need to find an attractive pricing entry point and do that through buying slightly shorter leases than the market average,’ said Baggaley.

SLIPIT is trading on one of the highest premiums in the sector at 10.1%, possibly because it has one of the highest dividend yields in the sector at 5.3%. The dividend is fully covered (117% covered in 2016).

Good quality property

Good quality property stands to better weather any storms.
‘In the event of recession secondary property is more likely to fall further in value as it has poorer quality tenants who may go bankrupt and costs more to maintain over the longer run as it needs investment,’ said Lowcock.

Buying/selling price

The most active managers in the sector have been taking profits where they see the chance to realise value and reinvesting the proceeds elsewhere.
Buying good quality property at a good price is critical. ‘If the price becomes expensive or the outlook for those properties changes then there is always a right price at which to sell an investment,’ added Lowcock.

‘The City of London had been seen as prime real estate as demand for property was growing, but with a number of large properties having been built in the area, the threat of Brexit to the city and technology making it easier for staff to work from home or elsewhere in the UK, it is easy for some to reach the view that the City of London has peaked.’

Risk

Managers of property investment trusts can also limit the amount of risk they are taking by taking a measured approach to their borrowing.

‘If investing in property trusts then the level of gearing needs to be considered in assessing the risk profile,’ said Haynes. ‘Whilst gearing enhances yield and the highly geared trusts have performed very strongly in a positive climate it is important that investors understand how gearing can amplify losses when the cycle turns.’

Tony Yousefian, investment trust research specialist at FundCalibre, points to the long-term prospects of managers who take a robust approach to risk management.

‘Longer term the relative stability of the income stream from property cannot be faulted,’ he said. ‘As an income generating asset class it remains a valid proposition especially with managers who have been positioning their portfolios defensively.’