We published Q4-2022 Portfolio Performance on 31 January 2023.
We will publish Q1-2023 Portfolio Performance on 28 April 2023 – this will include annual revaluations for all properties, undertaken by independent RICS-accredited chartered surveyors.
Today’s update covers important activity in February:
- Better’s investment in the Exchange & LHX All-Share Investment Plan
- Equity Fundraises & shareholder votes
- Enhanced property-by-property disclosure
- Unit disposals
1. Better’s investment in the Exchange & LHX All-Share Investment Plan
February was the first month of Better’s direct investment in the Exchange, which was completed in accordance with the Investment Policy.
This investment is creating greater liquidity and more efficient pricing across the marketplace. The volume traded on the Exchange in February is the highest for the last 8 months.
For investors looking to sell, this enhanced liquidity provides increased opportunity to exit.
Alongside Better’s investment, funds invested in the LHX All-Share Investment Plan have been successfully deployed. Clients that invested in February’s LHX All-Share are diversified across 39 properties and achieved an average 25% discount to Vacant Possession Value (after all fees and taxes). This represents a 34% unrealised capital gain on investment cost.
Customer funds are invested on a monthly basis and our March deployment is open for funding until 11.59pm today, 28 February.
2. Equity Fundraises & shareholder votes
In February, we identified 4 properties in need of new capital to strengthen their financial position:
- Red Lion Court, Greenford
- Flats 1, 5-7, Tower Mint, London
- Leeds Road, Harrogate
- Flats 15, 25, Anchor Point, London
For all 4 properties, shareholders voted to pursue this by way of Equity Fundraise rather than Auction Sales.
All 4 Equity Fundraises successfully passed the 50% threshold, 2 of which passed 100%, raising a total of over £570,000. These 4 properties now have significantly stronger balance sheets to pursue orderly unit disposals to maximise sales prices.
Three further properties will hold shareholder votes in March, which will be announced tomorrow.
3. Enhanced property-by-property disclosure
Information is the lifeblood of our Exchange and we are proud of the market-leading disclosure we produce for every property. We are constantly enhancing the information provided, including from investors’ valuable feedback.
All residential properties now show Individual Unit Details in a new tab in the “Financials” section.
For each unit, this shows purchase price, latest independent valuations, and where applicable, sale price and contracted rent. Below is an example, Lydan House:
In March, we will develop this further to include the ‘status’ of each unit, to show when properties are made vacant for sale, under offer, etc.
All mortgaged properties will, from tomorrow, show the Mortgage expiry date in the “Property Details” section.
As reported in detail over the past year, mortgage interest rates have been rising steeply and these are already disclosed for every mortgage. Mortgage expiry dates will now be added given their importance with regard to pressure on unit disposals for repayment, refinance/extension bank arrangement fees and outright refinance risk.
4. Unit disposals
Unit disposals are continuing at pace across the portfolio. Details for each disposal are updated every month on our Selling Record.
In January and February, we completed 12 sales, achieving a combined sales value of £1,980,000:
- 6.5% above independent Vacant Possession Value of £1,858,000
- 23% above original purchase price of £1,607,000
If you have questions about this update, please email us at email@example.com
The LHX team
Capital at risk. The value of your investment can go down as well as up. The Financial Services Compensation Scheme (FSCS) protects the cash held in your London House Exchange account, however, the investments that you make through London House Exchange are not protected by the FSCS. In the unlikely event that London House Exchange ran into difficulty, PricewaterhouseCoopers LLP has been pre-engaged to manage the sale of the property portfolio – read more about our Investment Safeguards here. The performance information (including any expression of opinion or forecast) reflects the most up-to-date data at the time of production; publication is made in good faith on the basis of publicly available information or sources believed to be reliable. Past performance and / or forecasts (if stated) are not a reliable indicator of future performance. Interest and capital returned may be lower than expected. Gross rent, dividends, and capital growth may be lower than estimated. Exiting your investments (on the Exchange, via the 5-year anniversary process or according to targeted strategies) is subject to price and demand. London House Exchange does not provide tax or investment advice and customers are advised to obtain appropriate tax or investment advice where necessary. Financial promotion by London House Exchange Limited (No. 8820870); authorised and regulated by the Financial Conduct Authority (No. 613499). See Key Risks for further information.