Unit holders of UPDC Real Estate investment Trust (UPDC REIT), managed by FSDH Asset Management Limited, have commended the Trustees for the total distribution of N1.4 billion for the year ended December 31, 2017. This represents 90 per cent of the income realised for the period.
The unit holders, who spoke at the 4th yearly general meeting of the company held in Lagos, Friday, urged the management to reduce its operating expenses to boost its bottom-line.A member of the Independent Shareholders Association of Nigeria, Williams Adebayo, said the company outweighed its peers in the industry in terms of performance.
“The company has performed creditably well but it has to work on its administrative cost and they should be thinking of getting new properties to improve their standard more.”
The Managing Director, FSDH Asset Management, Olumayowa Ogunwemimo, said the UPDC REIT portfolio is diversified and positioned to benefit from growth opportunities in both the residential and commercial sub-segments.According to her, the Trust traded a total of 1.32 million units in 2017, and closed at a price of N10.00 as at December 31, 2017 with earning yield of 8.10 per cent.
“Although the allocation to Real Estate asset class exceeds the target minimum of 75 per cent, the allocation to liquid assets exceeded the maximum investment of 10 per cent. This is as a result of the inability to find qualifying real estate or real estate related assets that met Trust’s requirement.
“In the course of the year, we identified a couple of real estate assets, but they were either overpriced or did not meet the investment criteria of the Trust, hence, we could not conclude on the acquisition.”
She assured that UPDC would continue to seek additional investments in real estate or real estate-related assets in the next financial year, to ensure that the target asset allocation is achieved.
According to her, the trust earned a total of N2.21 billion, which resulted in an earning yield of 8.30 per cent as at December 31, 2017.“In line with the Trust Deed, which requires the payment of 90 per cent of the Trust’s income as distribution to unit holders, the total distribution to unit holders for 12 months period will be N1.4 billion.
“This represents 90 per cent of the realised income for the period. Further to the interim distribution of N1.17 billion already paid, the fund managers is proposing a final distribution of N225 million.”