PRS REIT extends and revises deal with Sigma PRS Management

PRS REIT extends and revises deal with Sigma PRS Management

Real estate investment trust The PRS REIT has extended and revised its relationship with Sigma PRS Management Ltd.

The businesses have agreed to extend their investment advisory agreement and development management agreement to 30 June 2029 – an extension of two-and-a-half years from the previous term – while revising the fee rates to deliver estimated savings of around £460,000 per year.

Sigma PRS Management is a wholly-owned subsidiary of Sigma Capital Group, a build-to-rent regeneration specialist with a head office in Edinburgh, and additional offices in Manchester and London.

Steve Smith, chairman of The PRS REIT plc, said: “I am pleased to announce these new terms with Sigma PRS Management Ltd, the company’s investment adviser and development manager. They extend the relationship and reduce costs, generating around £0.46m of annual cost savings.

“Over the last seven years, Sigma has established the largest portfolio of new-build family rental homes in the UK on our behalf, pioneering a highly efficient delivery model and a new rental brand at the same time. The portfolio has performed extremely well and, with the huge undersupply of high-quality family homes in the UK, the company is well positioned for further success.

“These new terms lay the foundation for the next phase of our growth. If, as we anticipate, interest rates reduce in the coming period, I expect the company’s investment proposition to become increasingly attractive to investors.

“We look forward to reporting our next quarterly trading update towards the end of July.”

Graham Barnet, founder and CEO of Sigma Capital Group Limited, said: “Having founded and managed the PRS REIT since its inception, we are delighted to be extending the relationship.

“We view the PRS REIT’s prospects very positively; asset performance is excellent, rental income continues to grow, and we have improved the company’s operational cost base. In addition, 82% of long-term debt is fixed at an average weighted cost of 3.8% over an average term of 16 years.

“The PRS REIT will continue to benefit from our market-leading rental brand, Simple Life, as well as our technology platform. The company is strongly positioned in the single family homes market, which remains significantly undersupplied.”

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