Sustainability We continue to make good progress on multiple fronts in respect of sustainability issues and during the year we joined the Better Buildings Partnership, a collaboration of the UK’s leading commercial property owners. Our focus for the coming year will be on establishing our pathway to achieving net zero carbon. We are mindful of the need to do this in a way that benefits all our stakeholders. During the year we celebrated our fifteenth anniversary by supporting grassroots charities, helping support the work they do in this particularly difficult period. Outlook It is clear that we are well positioned and have built up an impressive track record over the years. What is more important is that this is maintained, and that we can innovate and position the business to ensure that we capture the positive opportunities that are likely to arise following this long period of disruption. Thankfully there is now light at the end of the tunnel, but we are mindful of the changing landscape and longer-term impacts that the pandemic might have on both the economy and how real estate is used. Along with my fellow Board members, I am excited about the potential ahead.
Capital structure We are conservatively positioned with a Group loan to value ratio of 21%. We have £50 million available through our revolving credit facility and assuming the economic recovery strengthens we will be seeking to deploy this, at least in part during the forthcoming year. We recognise that the current market cost of debt is lower than our own and where opportunities arise to reduce this on attractive terms, they will be pursued. Governance We continue to maintain strong corporate governance and during the year several changes to the Board have been made including my own appointment as Chair and that of Richard Jones as Chair of the Property Valuation Committee. I would like to thank my predecessor, Nicholas Thompson, for his years of service and similarly Roger Lewis who also stood down in the year. Despite not being able to meet physically due to the constraints of lockdown, I am pleased to have been able to spend time virtually with the Picton team and a number of larger shareholders. I look forward to continuing open and constructive engagement as we return to some degree of normality. Dividends Our initial response to the pandemic was to introduce a more conservative distribution policy, recognising the uncertainty around the severity and impact of the pandemic on our cash flow. Since then, and based on robust performance, we have been able to increase the dividend in both November and February such that the current distribution is 91% of pre-pandemic levels. We will continue to work hard to further improve occupancy and income in order to get back to pre-pandemic levels, hopefully during the forthcoming year.
LenaWilson CBE Chair 26 May 2021
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