RNS Number : 6463W
Mucklow(A.& J.)Group PLC
11 November 2014

AGM Statement

A & J Mucklow Group, the Midlands based Real Estate Investment Trust, announces a trading update for the period from 1 July 2014 to 10 November 2014, to coincide with its Annual General Meeting this morning.

Rupert Mucklow, Chairman, will comment:

The Midlands industrial property market has continued to perform well during the first four months of our financial year. Our occupancy rate has increased from 93.3% to 93.8%, with a further 1% of vacant space currently in legal hands.

Quoting rents on our vacant industrial properties have hardened by around 25p psf over the last six months, due to a shortage of available space and steady occupier demand.  Industrial rents are now averaging between £5.00 and £5.75 psf, depending on unit size, specification and location.

Occupiers are starting to realise that rental levels on second hand industrial space are rising for the first time in 15 years and likely to continue to do so, while demand outstrips supply. However, rental levels will have to rise above £6.00 psf before we consider speculatively developing any new space.

A 36,000 sq ft industrial unit at Redfern Park, Tyseley, Birmingham was let in October 2014 at a rent of £5.75 psf (£0.21m per annum) on a 20 year lease, without any break clauses. The vacant property was acquired and refurbished in the previous half year at a total cost of £1.74m.

Terms have also been agreed and solicitors instructed on two further lettings at £5.75 psf at Forward Park, Birmingham. The 26,000 sq ft industrial unit has recently been split and substantially refurbished at a cost of £0.17m and was previously let at a rent of £4.80 psf.

We continue actively to monitor the regional investment market for suitable acquisition opportunities, but none were identified during the period. Industrial property values still appear to be rising on the back of strong investor demand, supported by prospects of rental growth.

Our pre-let development at Apex Park, Worcester remains on time and budget with occupation and rental commencement of £0.72m per annum expected in December 2014.

Total net borrowings at 31 October 2014 were £68.1m, against a property investment portfolio last valued at £298.9m, while undrawn banking facilities totalled £35.0m. Debt to equity gearing remained at 30% and loan to value at 22%.

Other than as stated above, there has been no significant change in the company's financial position since 30 June 2014. The Board is confident of delivering another satisfactory level of performance in the year to 30 June 2015.



Rupert Mucklow, Chairman

David Wooldridge, Finance Director

0121 550 1841




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