Main Menu

Sharewatch: Hansteen

A haven in uncertain investment times

Bryan Johnston
Bryan Johnston

Hansteen is a real estate investment company with a portfolio mainly in industrial properties in continental Europe and the UK.  Its estate ranges across the Netherlands, Germany, Belgium, France and the UK.

The latest results, at the interim stage, showed a total return of 8% in the first half, the net asset value in line and earnings ahead of expectations.  Germany, representing 48% of the portfolio, saw an improvement of just under 3% despite the rather challenging economic environment in the region, while the UK (31% of the portfolio) increased by 5%.

The Benelux portfolio, representing 31%, grew by 4%.  The individual assets, collectively, look conservatively valued by the market as Hansteen is happy to acquiring its portfolio at discounted prices, often from distressed sellers, and as occupier markets continue to improve, this should benefit the group’s yield shift.

At present, the portfolio represents around 17% of “voids” that is unlet premises, but this figure could fall sharply over the next 12 to 18 months in the improving property climate, with a proportionately significant benefit to the group’s revenue stream.

Hansteen recently sold a UK industrial property portfolio, in which it owned one-third, in two separate transactions for a total consideration of £146m.  The total price is split across two separate transactions and is worth around £48m to the company.

Not only was the sale above book value it also secured an exit yield of around 6.8%.  At the same time, in another joint venture Hansteen purchased Saltley Business Park in Birmingham for £35.6m, offering an 8.4% contracted yield.  Hansteen’s shares offer a yield prospective of well over 5% and I think they are a relatively safe haven in these uncertain times, certainly rather more attractive than cash as an asset class.

Bryan Johnston is a director at Brewin Dolphin in Edinburgh

Please note:

The value of investments can fall and you may get back less than you invested. No investment is suitable in all cases and if you have any doubts as to an investment’s suitability then you should contact Brewin Dolphin. Past performance is not a guide to future performance. Any tax allowances or thresholds mentioned are based on personal circumstances and current legislation which is subject to change. If you invest in currencies other than your own, fluctuations in currency value will mean that the value of your investment will move independently of the underlying asset. The opinions expressed in this article are not necessarily the views held throughout Brewin Dolphin Ltd. No director, representative or employee of Brewin Dolphin Ltd accepts liability for any direct or consequential loss arising from the use of this document or its contents.  The information contained in this presentation has been taken from public sources and is believed to be reliable and accurate, but without further investigation cannot be warranted as to accuracy or completeness.

Leave a Reply

Your email address will not be published. Required fields are marked as *

This site uses Akismet to reduce spam. Learn how your comment data is processed.