Schroders REIT has published a circular outlining changes in its strategy to improve sustainability and implement decarbonisation measures.
The £466m trust, which owns 40 properties, said it is proposing amendments to the investment objective and the investment management agreement.
The changes are focused on adapting existing buildings to make them ‘both modern and fit for purpose’ to achieve a ‘green premium’ and capitalise on mispricing.
Schroders said it believes there is an opportunity to offer investors ‘a genuinely differentiated proposition’, whilst also attracting new investors who have specific sustainability objectives.
The firm hopes the changes will help increase the liquidity and rating of the trust’s shares.
An extraordinary general meeting will be held on 15 December 2023 to facilitate a shareholder vote to approve the proposed changes.
The circular was put out alongside the REIT’s half year results. The firm reported net asset value declined marginally to £296m from £300.7m at the end of March 2023.
The six-month total return from the underlying portfolio was 1.9% compared with the MSCI benchmark at -0.6%.
The trust also confirmed the appointment of Sanjay Patel as an independent non-executive director from 1 January 2024.
Chair of the board Alastair Hughes commented: “Although the short-term outlook clearly remains uncertain, prudent steps taken by the manager to secure low cost, long-term debt for the company, and increase exposure to higher growth sectors, means the company is well positioned to continue outperforming the benchmark, deliver on its investment objective and provide a progressive dividend over time.
“As announced separately today, the company has issued a circular proposing to formally include sustainability at the centre of its investment proposition. As sustainability considerations become even more important for investors and occupiers, we have a strong conviction that it will clearly help to differentiate the company and drive more sustainable, risk-adjusted returns.”
Nick Montgomery, fund manager, added: “We continue to make good progress against our strategic objectives to deliver dividend growth by improving the quality of the underlying portfolio through a disciplined, research-led approach to transactions, capital investment, active asset management and operational excellence.”