We regularly review the income performance of every property on our platform to ensure that the dividends paid to investors are aligned with the net rental profits generated by the investment.
As a result of the latest review, we have identified 21 properties where the dividend payment has not remained consistent with the net rental income. The dividend will be adjusted accordingly to reflect the current performance of the property.
From 5th February 2019, 13 properties will pay a lower dividend and 8 will pay a higher dividend. The remaining 80 properties currently paying dividends will remain unchanged.
For each property where there has been a change, we have provided a detailed explanation of the reasons for the change at the top of the “Investment Case” section for that property. Please note that the dividends listed here are based on the Latest Valuation of each property, which you can see in the property’s “Financials” section.
The overall impact across the portfolio is that the weighted average dividend yield has decreased from 4.09% to 4.01%.
The changes in dividends for the 8 properties that will pay a higher dividend are as follows:
| Property address | Current dividend | Change (%) | New dividend |
|---|---|---|---|
| Murray Court, Hanwell, London | 2.16% | 0.25% | 2.41% |
| Stokes Mill, Stalybridge, Greater Manchester | 3.99% | 0.50% | 4.49% |
| Fairholme Road, Croydon | 3.49% | 0.25% | 3.74% |
| Kentlea Road, Thamesmead | 3.37% | 0.25% | 3.62% |
| Burns Street, Leicester | 5.81% | 0.75% | 6.56% |
| London Road, Brighton | 3.68% | 0.50% | 4.18% |
| Woodland Way, Mitcham | 3.74% | 0.25% | 3.99% |
| Whitewell Road, Frome, Somerset | 3.21% | 0.25% | 3.46% |
The changes in dividends for the 13 properties that will pay a lower dividend are as follows:
| Property address | Current dividend | Change (%) | New dividend |
|---|---|---|---|
| Sandars Maltings, Gainsborough | 4.85% | (1.00%) | 3.85% |
| Flats 4, 7 & 9, Anchor Point, Surrey Quays, London | 2.48% | (0.75%) | 1.73% |
| Flat 15 & 25, Anchor Point, Surrey Quays, London | 2.38% | (0.75%) | 1.63% |
| Flat 21, Anchor Point, Surrey Quays, London | 2.78% | (0.50%) | 2.28% |
| Jubilee Mansions, Barons Court, London | 1.86% | (0.50%) | 1.36% |
| Keogh House, Swindon | 4.24% | (0.75%) | 3.49% |
| Friars Way, Fenham, Newcastle | 5.12% | (1.00%) | 4.12% |
| Compass Court, Eastbourne | 4.54% | (0.50%) | 4.04% |
| Garden Court, West Drayton | 2.10% | (0.50%) | 1.60% |
| Red Lion Court, Greenford, London | 2.09% | (0.25%) | 1.84% |
| Leeds Road, Harrogate | 3.77% | (1.00%) | 2.77% |
| St David’s Lodge, Hastings | 2.41% | (0.50%) | 1.91% |
| Falcon Heights, Clapham Junction, London | 2.62% | (0.75%) | 1.87% |
Why are the dividend yields changing?
As a large scale, professional asset manager, Property Partner aims to deliver strong income returns for investors from the properties on our platform. We treat our tenants fairly, and manage properties to minimise voids and reduce longer term repair and refurbishment costs. In turn, this enables us to maximise rental profit and the resulting dividend we are able to pay investors over time.
Each of our investment properties is held within a Special Purpose Vehicle (SPV), which is a UK limited company. The costs of managing the property and servicing the mortgage are covered by the rental income it generates, and the profit is paid out to shareholders in the form of a monthly dividend.
Both rental income and operating costs fluctuate over time due to a multitude of factors, and the profits will change accordingly. For example, higher than expected levels of vacancy would reduce rental profit, while increased demand from tenants in a local area could facilitate greater than expected rental increases.