CLS Holdings rebalances portfolio in Europe

Property investment company CLS Holdings has made changes to its portfolio by investing in Germany and divesting in France and Britain .

Between 1 July 2016 and 22 November 2016 two acquisitions were made in Germany, Parsevalstrasse in Dusseldorf for €43.6m and Harburger in Hamburg for €5.9m. Meanwhile, it has disposed of Chancel House in London for £18.7m and Chorus in Antibes for €9.4m.

The majority of the group’s portfolio resides in London at 54% with 6% in the rest of the UK and in Europe, Germany takes 23% and France 17%.

Current developments at Vauxhall Square, Spring Mews in London and Ateliers Victoires in Paris are expected to be complete by 2017.

Seven new bank loans have been completed since 1 July 2016 for £91.7m at an average rate of 1.68% mostly at fixed rates for an average of over 5.4 years. The weighted average cost of debt reduced to 3.08%, a record low for the group and the weighted average loan-to-value of property loans was ‘comfortable’ at 50.5%.

The group had liquid resources of over £170m comprising £72m of cash, £55m of corporate bonds and undrawn facilities in excess of £45m.

Vacancy rates have fallen in France to 3.5% from 5% and in Germany to 1.9% from 2.1%, but rose in London to 4.9% from 4.6% with the rest of the UK remaining flat at 0.9%.

Chief executive Fredrik Widlund said: “Since 1 July, we have continued to rebalance our portfolio, with the disposals of non-core assets in France and London and the acquisition of higher yielding properties in Germany. I am pleased to report that occupier markets in London have remained resilient to the uncertainty created by Brexit, whilst vacancy rates have fallen in Germany and, in particular, in France. Our geographical diversification and the relative strength of our non-sterling assets continue to positively contribute to the net assets and profits of the group.”

The share price rose 0.03% to 1,580.40p at 1354 GMT on Wednesday.