Stenprop selling offices and other commercial assets as it moves to industrial assets

Stenprop plans to become an industrial property player
The property group is selling offices and other commercial assets as it moves to industrial assets

Stenprop’s decision to become multi-let industrial landlord will weaken its dividend in the short term, CEO Paul Arenson says.

The company has been disposing of its office assets and buying multi-let industrial properties as its management believes this is an attractive sector with long-term potential. These are assets that generally include 10 industrial tenants.

Stenprop, which released financial results for the six months to end-September on Thursday, declared an interim dividend of 3.375p per share, which represents a 15.625% fall compared with the six months to end-September 2017.

“Stenprop is transitioning from a diversified real estate investment trust into a multi-let industrial property owning company,” Arenson said, adding that as much as 27% of the company’s assets are industrial.

He said that by the end of the financial year to end-March 2019, 40% of its assets will include multi-let industrial properties.

Arenson said the company bought assets valued at £25m during the period under review and will buy another £75m worth by the end of the financial year.

In 2020, Stenprop plans to buy another £100m worth of assets, giving it 65% exposure to multi-let industrial assets.