Interim results for the period ended 30 September 2025

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A strong operational performance with active asset management driving valuation and earnings growth, underpinning fully covered dividend

Custodian Property Income REIT (LSE: CREI), which seeks to deliver an enhanced income return by investing in a diversified portfolio of smaller regional properties with strong income characteristics across the UK, today announces its interim results for the period ended 30 September 2025 (“the Period”).

Commenting on the interim results, Richard Shepherd-Cross, Managing Director of the Investment Manager, said: “The direct property market is continuing its recovery in the UK, with valuations improving quarter-on-quarter, driven by rental growth across all sectors. The strong performance of the underlying assets should be expected to steadily flow through to listed property companies’ share prices, but a further shift in market sentiment is required along with a willingness to consider the longer-term opportunity that exists in real estate.

“At a property level, Custodian Property Income REIT is delivering on all fronts to provide shareholders with strong income returns by capturing portfolio reversion and driving sustainable earnings growth. During the Period, our targeted asset management programme grew the rent roll from £43.9m to £45.9m, primarily driven by lease renewals picking up ongoing rental growth, as well as the new lettings of vacant units and positive rent review results.  In line with the growth of the rent roll and estimated rental value of the portfolio, we have witnessed continued valuation growth for the fifth consecutive quarter, with NAV per share increasing by 2.9% since 31 March 2025.

“The portfolio has continued to deliver a fully covered dividend of 6.0p per share, with future rental growth potential of 13% embedded, and offering a road map to further earnings growth.  Simultaneously, undertaking profitable sales ahead of pre-offer valuations has helped to fund various refurbishment initiatives within the existing portfolio, as well as proving valuations.  Our ongoing share buyback programme has executed the timely acquisition of shares at a discount to NAV.

“In the inflationary environment that is likely to persist, real assets that can be enhanced to deliver rental and capital growth will protect the real value of both shareholders’ investment and income.  At the same time, we will continue to look for opportunities to grow through corporate acquisitions similar to the Merlin transaction we announced at the start of the Period.”

Highlights of the Period:

  • 3.3% growth in EPRA earnings per share to 3.1p (30 September 2024: 3.0p) with a fully covered dividend per share of 6.0p, reflecting a 7.4% dividend yield as at 30 September 2025
  • Estimated rental value (“ERV”) increased by 3.4% from £50.2m to £51.9m, with ERV 13% ahead of passing rent, providing a significant opportunity to unlock further rental growth through asset management and at lease events
  • Leasing activity during the Period included eight new lettings and four rent reviews, helping grow the rent roll from £43.9m as at 31 March 2025 to £45.9m as at 30 September 2025
  • Occupancy increased by 1.1% to 92.2% (31 March 2025: 91.1%)
  • Like-for-like valuation of the Company’s portfolio of 175 properties increased by 1.9% to £625.0m, supporting a 2.9% NAV per share increase and contributing to a 6.0% NAV total return (30 September 2024: 3.6%). Encouragingly, valuations have improved at an accelerating rate, quarter-on-quarter, reflecting falling interest rates and the recovery of real estate market sentiment
  • £1.6m of solar panel valuation increases represent a 124% uplift on the cost of five of the Company’s operational arrays
  • £6.2m of capital investment during the Period, primarily relating to the refurbishment of industrial units in Plymouth and Biggleswade
  • £8.9m of proceeds from selective disposals achieved at an aggregate 12% premium to pre-offer valuation, with a further £2.4m of disposals since the Period end
  • Net gearing remains low at 26.3% (31 March 2025: 27.9%) with 69% at a fixed rate of interest
  • During the Period, the Company completed the purchase of a £22.1m portfolio via the all-share acquisition of a family property company. The ‘Merlin’ acquisition comprised a £19.4m portfolio of 28 smaller lot-size regional UK investment properties which are highly complementary to the Company’s existing assets, as well as c. £2.7m of newly built housing stock, the ongoing sales of which are expected to conclude by the end of the financial year, generating additional cash for the Company.

You can read the full update here.