Atlantic Leaf is an income-focused UK REIT, targeting commercial property in strategic regions and sectors of the United Kingdom. The company’s primary objective is to provide suitable returns to investors through long-term investments in quality real estate assets which have sound property fundamentals, stable income profiles and good prospects for capital growth.
Atlantic Leaf enhances shareholder returns by employing gearing, in the form of low-cost bank debt. A conservative degree of leverage is used to provide attractive returns while maintaining an acceptable risk profile.
The company seeks to facilitate further value creation by evaluating and implementing strategic, active asset management plans for each property. This may involve new lettings and lease extensions, refurbishments, and developments, among other activities. Asset management potential is a key consideration when assessing acquisition opportunities.
The following criteria are considered in evaluating each new investment opportunity:
- Quality, location and durability of assets;
- Core sustainable income flows, existing and projected occupancy rates and tenant covenant strength;
- Opportunities for asset enhancement through active management, including new lettings, refurbishment and development;
- Rental yield spread relative to fixed rate borrowing costs and key valuation and financing metrics; and
- Proper evaluation of risk factors, including security of income, tenant covenants, residual values, the physical condition of properties, loan-to-value and interest covenants and maturity profiles in respect of leveraged purchases.