Listed ICG-Longbow fund meets dividend target

The listed UK real estate debt fund managed by ICG-Longbow overcame rising competition in the UK commercial real estate debt markets to meet its dividend target for the year.  

ICG-Longbow’s listed senior UK debt vehicle met its dividend target announcing a fourth payment of 1.5 pence per share, in line with the 6 percent per annum target on the £1 offering share price. In September, the firm’s chairman Jack Perry said that rising competition meant it could no longer deploy new capital at the returns promised in 2013.

The vehicle issued 3.6 million new ordinary shares issued in April last year raising £3.67 million ($5.5 million; €5.1 million) in capital to complete its investment programme. In September, Perry said that the company would focus on “investment monitoring and portfolio management” rather than raising any further capital.

ICG-Longbow Senior Secured UK Property Debt Investments Ltd reported a year-on-year increase in net asset value per share from 98.79 pence to 99.99 pence for the 12 months period ending 31 January 2015. ??

The listed real estate debt fund has also completed its initial investment programme deploying £18 million into two new loans in the first quarter of 2015. Profit after tax totalled 7.57 million, well up from a year earlier when it stood at £1.35 million before the vehicle was fully invested. Profit per share was 7.05 pence.

At the end of January, the company’s loan assets totalled £104 million across 11 different facilities. The weighted average interest coupon was 7.4 percent, up from 7.28 percent at the end of January 2014. Weighted average gross IRR was 8.49 percent.

ICG-Longbow’s strategy is to target defensive, senior debt investments secured with first lien fixed charges. It focuses on financing UK commercial property investments. The weighted average loan-to-value of the portfolio was 60.1 percent, down slightly from the January 2014 ratio of 61.7 percent. Interest coverage ratio fell to 161 percent from 165 percent 12 months earlier.

The company announced that all its assets are performing with no covenant breaches. ICG-Longbow listed on the London Stock Exchange in February 2013 raising £108 million in capital.