Just group PLC | Annual Report and accounts 2022
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
15 INVESTMENT PROPERTY
Year ended 31 December 2022 £m
Year ended 31 December 2021 £m
69.6
At 1 January
–
–
Recognised on acquisition of the Jersey Property Unit Trust (see note 35)
70.6
(29.3)
Net loss from fair value adjustment
(1.0)
At 31 December
40.3
69.6
Investment properties are leased to tenants. Investment properties are valued using discounted cash flow analysis using assumptions based on the repayment of the underlying loan. The valuation model discounts the expected future cash flows using a discount rate which includes a credit spread allowance associated with that asset. The redemption and default assumptions are derived from the assumptions for the Group’s bond portfolio.
Minimum lease payments receivable on leases of investment properties are as follows (undiscounted cashflows):
2022 £m
2021 £m
1.1 1.1 1.1 1.1 1.1
Within 1 year
1.1 1.1 1.1 1.1 1.1
Between 1 and 2 years Between 2 and 3 years Between 3 and 4 years Between 4 and 5 years
127.7 133.2
Later than 5 years
128.8 134.3
Total
16 FINANCIAL INVESTMENTS All of the Group’s financial investments are measured at fair value through the profit or loss and are either designated as such on initial recognition or, in the case of derivative financial assets, classified as held for trading. Fair value Cost 2022 £m 2021 £m 2022 £m 2021 £m Units in liquidity funds 1,174.4 1,310.5 1,174.4 1,310.5 Investment funds 421.0 301.8 407.8 290.5 Debt securities and other fixed income securities 11,370.5 12,924.0 13,229.7 12,141.7 Deposits with credit institutions 907.6 52.9 907.6 52.9 Loans secured by residential mortgages 5,305.9 7,422.8 4,265.6 4,328.7 Loans secured by commercial mortgages 583.7 677.8 643.4 686.3 Loans secured by ground rents 246.9 189.7 356.3 185.9 Infrastructure loans 1,056.4 993.1 1,205.8 858.0 Other loans 134.2 117.9 131.0 115.0 Derivative financial assets 2,276.6 691.2 – – Total 23,477.2 24,681.7 22,321.6 19,969.5
The majority of investments included in debt securities and other fixed income securities are listed investments.
Units in liquidity funds comprise wholly of units in funds which invest in very short dated liquid assets. However as they do not meet the definition of cash available on demand, liquidity funds are reported within financial investments. Liquidity funds do however meet the definition of cash equivalents for the purposes of disclosure in the Consolidated statement of cash flows. Deposits with credit institutions with a carrying value of £892.4m (2021: £50.3m) have been pledged as collateral in respect of the Group’s derivative financial instruments. Amounts pledged as collateral are deposited with the derivative counterparty. Derivatives are reported within financial investments where the derivative valuation is in an asset position, or alternatively within other financial liabilities where the derivative is in a liability position.
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