TIDMSWEF
RNS Number : 6304S
Starwood European Real Estate Finan
18 March 2016
18 March 2016
Starwood European Real Estate Finance Limited
Annual Financial Report year ended 31 December 2015
The Company has today published its annual financial report for
the year ended 31 December 2015 and has made it available online at
www.starwoodeuropeanfinance.com.
Starwood European Real Estate Finance Limited is an investment
company listed on the main market of the London Stock Exchange with
an investment objective to provide Shareholders with regular
dividends and an attractive total return while limiting downside
risk, through the origination, execution, acquisition and servicing
of a diversified portfolio of real estate debt investments in the
UK and the wider European Union's internal market.
The Group is the largest London-listed vehicle to provide
investors with pure play exposure to real estate lending.
The Group's assets are managed by Starwood European Finance
Partners Limited, an indirect wholly-owned subsidiary of the
Starwood Capital Group.
Key highlights
-- The Group had net assets of GBP305.5 million and total assets
of GBP314.4 million at year end, with investments in a portfolio 15
loans which is diversified by sector and geography.
-- The NAV and share price total return in the period were 7.58% and 8.22% respectively.
-- At the year end, the shares were quoted at 107.63 pence per
share, being a premium of 7.17% to the net asset value per share of
100.43 pence.
-- Eight new loans and refinancings were made during the period,
for a total investment of approximately GBP108 million and three
loans were repaid in full during the year for a total amount of
approximately GBP39 million.
-- The Company issued shares in two transactions during the
period, for total proceeds (gross of transaction costs) of GBP68
million and has an open placing programme under which further share
issues may be made.
The Group experienced minimal cash drag throughout the year by
managing cash balances and drawings on the revolving credit
facility. The table below shows key financial data as at the year
end and for the period under review:
Year ended Year ended
31 December 31 December
2015 2014
----------------------------------- ------------- -------------
NAV per ordinary share 100.43 100.08
p p
Share price 107.63 106.25
p p
Premium to Net Asset Value 7.17% 6.17%
----------------------------------- ------------- -------------
NAV total return for the period 7.58% 6.23%
Share price total return for
the period 8.22% 10.93%
----------------------------------- ------------- -------------
Loans advanced (including accrued GBP307.7 GBP221.0
income) m m
----------------------------------- ------------- -------------
Total Assets GBP314.4 GBP239.6
m m
Amount drawn under Revolving GBP8.2 GBP0.0
Credit Facility m m
Total Net Assets GBP305.5 GBP238.3
m m
----------------------------------- ------------- -------------
Number of Loans 15 12
----------------------------------- ------------- -------------
Dividends per ordinary share
declared for the period(1) 7.0 p 5.8 p
Portfolio yield (2) 8.7% 9.6%
----------------------------------- ------------- -------------
Ongoing charges percentage (3) 1.1% 1.0%
----------------------------------- ------------- -------------
Weighted average portfolio LTV
to Group first GBP (4) 16.0% 15.3%
Weighted average portfolio LTV
to Group last GBP (4) 65.3% 62.5%
----------------------------------- ------------- -------------
(1) Figure disclosed is the sum of the dividend declared in
relation to each quarter of the financial. This will not equal the
dividend recognised in the financial statements and actually paid
in the financial year as dividends are recognised and paid one
quarter in arrears. The Company's dividend target for 2016 is 6.5
pence per share
(2) Calculated on amounts currently outstanding, excluding
undrawn commitments, and assuming all currently drawn loans are
outstanding for the full contractual term. Nine of the loans are
floating rate (partially or in whole and some with floors) and
returns are based on an assumed profile for future interbank rates
but the actual rate received may be higher or lower. Calculated
only on amounts funded to date and excluding committed amounts and
cash un-invested. The calculation excludes the origination fee
payable to the Investment Manager and commitment fees on undrawn
funds.
(3) Prepared in accordance with the AIC's recommended
methodology.
(4) LTV to Group last GBP means the percentage which the total
loan commitment less any amortisation received to date (when
aggregated with any other indebtedness ranking alongside and/or
senior to it) bears to the market value determined by the last
formal lender valuation received by the date of publication of
these financial statements. LTV to first Group GBP means the
starting point of the loan to value range of the loan commitments
(when aggregated with any other indebtedness ranking senior to it).
For Lifecare, W Hotel and Centre Point the calculation includes the
total facility available and is calculated against the market value
on completion of the project. For Aldgate, the calculation includes
the total facility available against the stabilised value of the
property.
For further information, please contact:
Peter Denton - Starwood Capital - 020 7016 3664
Robert Peel - Dexion Capital - 020 7832 0900
Full text of annual financial report for the year ended 31
December 2015
Objective and Investment Policy
Investment Objective
The investment objective of Starwood European Real Estate
Finance Limited (the "Company"), together with its subsidiaries
Starfin Lux S.à.r.l, Starfin Public LP and Starfin Public GP
(collectively the "Group"), is to provide its shareholders with
regular dividends and an attractive total return while limiting
downside risk, through the origination, execution, acquisition and
servicing of a diversified portfolio of real estate debt
investments (including debt instruments) in the UK and the wider
European Union's internal market.
Investment Policy
The Company invests in a diversified portfolio of real estate
debt investments (including debt instruments) in the UK and the
wider European Union's internal market. Whilst investment
opportunities in the secondary markets will be considered from time
to time, the Company's predominant focus is to be a direct primary
originator of real estate debt investments on the basis that this
approach is expected to deliver better pricing, structure and
execution control and a client facing relationship that may lead to
further investment opportunities.
The Company will attempt to limit downside risk by focusing on
secured debt with both quality collateral and contractual
protection.
The Company anticipates that the typical loan term will be
between three and seven years. Whilst the Company retains absolute
discretion to make investments for either shorter or longer
periods, at least 75 per cent of total loans by value will be for a
term of seven years or less.
The Company's portfolio is intended to be appropriately
diversified by geography, real estate sector type, loan type and
counterparty.
The Company will pursue investments across the commercial real
estate debt asset class through senior loans, subordinated loans
and mezzanine loans, bridge loans, selected loan-on-loan financings
and other debt instruments. The split between senior, subordinated
and mezzanine loans will be determined by the Investment Manager in
its absolute discretion having regard to the Company's target
return objectives. However, it is anticipated that whole loans will
comprise approximately 40-50 per cent of the portfolio,
subordinated and mezzanine loans approximately 40-50 per cent and
other loans (whether whole loans or subordinated loans) between
0-20 per cent (including bridge loans, selected loan-on-loan
financings and other debt instruments). Pure development loans will
not, in aggregate, exceed 25 per cent of the Company's Net Asset
Value ("NAV") calculated at the time of investment. The Company may
originate loans which are either floating or fixed rate.
The Company may seek to enhance the returns of selected loan
investments through the economic transfer of the most senior
portion of such loan investments which may be by way of
syndication, sale, assignment, sub-participation or other financing
(including true sale securitisation) to the same maturity as the
original loan (i.e. "matched funding") while retaining a
significant proportion as a subordinate investment. It is
anticipated that where this is undertaken it would generate a
positive net interest rate spread and enhance returns for the
Company. It is not anticipated that, under current market
conditions, these techniques will be deployed with respect to any
mezzanine or other already subordinated loan investments. The
proceeds released by such strategies will be available to the
Company for investment in accordance with the investment
policy.
Loan to Value ("LTV")
March 18, 2016 11:25 ET (15:25 GMT)
Computershare Investor Services (Guernsey) Limited PricewaterhouseCoopers CI LLP
3(rd) Floor Royal Bank Place
Natwest House 1 Glategny Esplanade
Le Truchot St Peter Port
St Peter Port Guernsey, GY1 4ND
Guernsey, GY1 1WD
Broker
Dexion Capital plc Principal Bankers
1 Tudor Street Barclays Private Clients International Limited
London, EC4Y 0AH PO Box 41
United Kingdom Le Marchant House
St Peter Port
Guernsey, GY1 3BE
Administrator, Designated Manager and Company Secretary
Ipes (Guernsey) Limited Website: www.starwoodeuropeanfinance.com
1, Royal Plaza, Royal Avenue
St Peter Port,
Guernsey, GY1 2HL
This information is provided by RNS
The company news service from the London Stock Exchange
END
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