Every quarter, we 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 and the net asset position of each property investment.<\/p>\n\n\n\n
As a result of the latest review, we have identified 16 properties where the dividend will be adjusted to reflect the current performance and financial position of the property.<\/p>\n\n\n\n
From 5 November 2019, 10 properties will pay a lower dividend and 6 will pay a higher dividend. For all remaining properties, dividends will remain unchanged.<\/p>\n\n\n\n
For each property where there has been a change, we have provided an explanation of the reasons for the change at the top of the \u201cInvestment Case\u201d section for that property. Please note that the dividend yields listed here are based on the Latest Valuation of each property, which you can see in the property\u2019s \u201cFinancials\u201d section.<\/p>\n\n\n\n
The changes in dividends for the 6 properties that will pay a higher dividend are as follows:<\/p>\n\n\n\n The changes in dividends for the 10 properties that will pay a lower dividend are as follows:<\/p>\n\n\n\n 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, manage properties to minimise voids and reduce longer term repair and refurbishment costs. This enables us to maximise rental profit and the resulting dividend we are able to pay investors over time.<\/p>\n\n\n\n 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.<\/p>\n\n\n\n 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.<\/p>\n\n\n\n When an individual property experiences a shortfall and does not have sufficient cash immediately, this will be covered by the property portfolio central fund extending a short-term, interest-free loan to the SPV.<\/p>\n\n\n\n To ensure that \u201cstrong\u201d properties are not subsidising properties with management issues, we will then reduce the dividend of the borrowing SPV to create the surplus required to repay the loan over a reasonable period e.g. 6-12 months. This is consistent with our existing, quarterly review of all property dividend yields, resulting in adjustments where necessary.<\/p>\n\n\n\n The central fund benefits investors, as long-term property management decisions should not be determined solely by the immediate availability of cash within a single property SPV. And it avoids the severe volatility that would result if we were to suspend dividends every time an unexpected bill was received.<\/p>\n\n\n\nProperty address<\/strong><\/th> Current dividend<\/strong><\/th> Change (%)<\/strong><\/th> New dividend<\/strong><\/th><\/tr> Molyneux Court, Liverpool<\/a><\/td> 3.52%<\/td> 0.25%<\/td> 3.77%<\/td><\/tr> Station Road, Sutton<\/a><\/td> 2.41%<\/td> 0.50%<\/td> 2.91%<\/td><\/tr> Stokes Mill, Stalybridge<\/a><\/td> 4.64%<\/td> 0.50%<\/td> 5.14%<\/td><\/tr> Pierpoint Street, Worcester<\/a><\/td> 6.06%<\/td> 0.50%<\/td> 6.56%<\/td><\/tr> Terence House, Newcastle<\/a><\/td> 6.34%<\/td> 0.50%<\/td> 6.84%<\/td><\/tr> Pitt Street, Newcastle<\/a><\/td> 6.27%<\/td> 0.50%<\/td> 6.77%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n Property address<\/strong><\/th> Current dividend<\/strong><\/th> Change (%)<\/strong><\/th> New dividend<\/strong><\/th><\/tr> 42 Flats in Sandars Maltings, Gainsborough<\/a><\/td> 3.97%<\/td> (0.50%)<\/td> 3.47%<\/td><\/tr> Compass Court, Eastbourne<\/a><\/td> 4.09%<\/td> (0.75%)<\/td> 3.34%<\/td><\/tr> Flat 21, Anchor Point, Surrey Quays<\/a><\/td> 2.33%<\/td> (0.75%)<\/td> 1.58%<\/td><\/tr> St Catherines Mews, Lincoln<\/a><\/td> 4.07%<\/td> (0.50%)<\/td> 3.57%<\/td><\/tr> 22 Rubicon Court, Romford<\/a><\/td> 2.64%<\/td> (0.75%)<\/td> 1.89%<\/td><\/tr> Flat 4, 7, 9, Anchor Point, Surrey Quays<\/a><\/td> 1.79%<\/td> (0.25%)<\/td> 1.54%<\/td><\/tr> Bourne End, Buckinghamshire<\/a><\/td> 2.18%<\/td> (0.50%)<\/td> 1.68%<\/td><\/tr> St David’s Lodge, Hastings<\/a><\/td> 1.96%<\/td> (0.50%)<\/td> 1.46%<\/td><\/tr> 8 Flats in Red Lion Court, Greenford<\/a><\/td> 1.89%<\/td> (0.50%)<\/td> 1.39%<\/td><\/tr> Huddersfield, West Yorkshire<\/a><\/td> 5.53%<\/td> (1.00%)<\/td> 4.53%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n Why are the dividend yields changing?<\/strong><\/h3>\n\n\n\n