Segro to raise £650m through private share placement to pursue ‘opportunities’
Property investment firm Segro has announced it will raise £650m through a private share placement to pursue “opportunities” across the UK and Europe.
In a statement released after markets closed, Segro said the new equity would allow it to “take advantage of additional investment opportunities across the UK and Continental Europe through further, mostly pre-let, development projects”. It is also looking to acquire land and investment assets.
The firm simultaneously released a trading update saying that new lettings and pre-let development agreements were ahead of where expectations were before the pandemic hit. They noted that the pandemic had accelerated the adoption of new technology and e-commerce, which has helped its big box and urban warehouse portfolio.
E-commerce volumes in April represented 31 per cent of retail sales, a 16 per cent increase.
The board has said Segro will be able to invest more than £1bn of capital into development activity and additional acquisitions across 2020 and 2021. Yesterday the firm said it had bought the 34-acre site, Privale Park, in west London for £202.5m.
Segro also said it would continue to target a payout ratio of 85 per cent to 95 per cent of adjusted profit after tax, adding that it intended to declare an interim dividend of 6.9 pence per share.
Chief executive David Sleath said: “Our strong, primarily pre-let, development pipeline across the UK and Continental Europe reflects the demand from customers looking to grow.”
“Our list of additional near-term pre-lets, which is approximately double the size of a year ago, and our well-located land bank mean we are well-placed to make further progress in the months ahead.”