Picton Property Income Limited Annual Report 2021

Strategic Report Portfolio Review continued

Retention rates and occupancy

Our largest void is Stanford Building on Long Acre in Covent Garden, London, accounting for over a quarter of the total. The refurbishment was completed during the period. We were pleased to welcome our first occupier to the second floor and we have moved into the first floor, following an expiry of our lease in the City. This move has allowed us to reduce costs and provided us with flexibility going forward. We are continually focused on futureproofing assets from a sustainability perspective, which has resulted in an improvement in our EPCs with 92% now rated D and above. The average lot size of the portfolio is £14.8 million, 5% ahead of last year.

Longevity of income As at 31 March 2021, expressed as a percentage of contracted rent, the average length of the leases to the first termination was 4.9 years (2020: 5.5 years). This is summarised as follows:

Over the year, total ERV at risk due to lease expiries or break options totalled £6.6 million, consistent with the year to March 2020. Excluding asset disposals, we retained 88% of total ERV at risk in the year to March 2021. Of leases that were due to expire during the year, 93% of ERV was retained. Of leases that had a break clause in the year, 67% of ERV was retained. In addition, a further £4.2 million of ERV was retained by either removing future breaks or extending future lease expiries ahead of the lease event. Occupancy has increased during the year from 89% to 91%, which is slightly behind the MSCI UK Quarterly Property Index of 92% at March 2021. The increase primarily reflects the success of the refurbishment programme in 2020, meaning we were able to attract new occupiers and that occupancy increased in all sectors of the portfolio. At the year- end, over half of our vacant buildings were being refurbished and with the rest available to let and being actively marketed. Of our total void of £4.0 million by ERV, 85% is in offices, 14% is in retail and only 1% is in industrial.

%

0 to 1 year 1 to 2 years 2 to 3 years 3 to 4 years 4 to 5 years 5 to 10 years 10 to 15 years 15 to 25 years

11.9 13.8 13.5 13.6 18.9 20.0 6.9 0.1 1.3

25 years and over

Total

100.0

Top ten assets The largest assets as at 31 March 2021, ranked by capital value, represent 55% of the total portfolio valuation and are detailed below.

Acquisition date

Property type

Approximate area (sq ft)

No. of occupiers

Occupancy rate (%)

Assets

Tenure

Parkbury Industrial Estate, Radlett, Herts. River Way Industrial Estate, Harlow, Essex Angel Gate, City Road, London EC1 Datapoint, Cody Road, London E16 Tower Wharf, Cheese Lane, Bristol Shipton Way, Rushden, Northants. 50 Farringdon Road, London EC1 Lyon Business Park, Barking, Essex Colchester Business Park, Colchester *Denotes leasehold interest in excess of 950 years.

03/2014 Industrial 12/2006 Industrial 10/2005 Office 05/2010 Industrial 08/2017 Office 07/2014 Industrial 10/2005 Office 09/2013 Industrial 10/2005 Office

Freehold 343,800 Freehold 454,800 Freehold 64,600

21 100 10 100

20

68 33

Stanford Building, Long Acre, London WC2 05/2010 Office

Freehold Leasehold Leasehold* Leasehold*

20,100 55,100 312,900 31,300

2

6 100

Freehold 70,600

5

83

1 100 4 100 9 100

Freehold 99,400 Leasehold 150,700

22

97

36

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