First Property Group plc, a property fund manager and investor, held its Annual General Meeting (AGM) today. The Chairman of the board, Alasdair Locke, stated that the Group has maintained its net asset value (NAV) per share despite challenging market conditions in the property sector, including lockdowns, working from home trends, interest rate rises, inflation, and the drive to net zero. The Group has reported continued leasing progress at its properties, which will contribute to income and capital value growth in the future.
Locke highlighted the impressive internal rate of return (IRR) earned by the Group, which stands at 19% on an annualized basis since the admission of its shares to trading on AIM in 2001 and since the peak of the boom in 2007. However, the IRR has been negative 3% since March 2019 due to the onset of COVID-19 related lockdowns and market difficulties.
Since the financial year-end on March 31, 2023, the Group has achieved leasing progress at Blue Tower, its office property in Warsaw, and at Maestro Business Centre, an office building in Cluj, Romania. The Group has also acquired the minority share interest in E and S Estates Ltd, resulting in the Company now owning 100% of the shares in E and S.
As of August 31, 2023, the total funds under management, including properties owned directly by the Group, amounted to £436 million, a decrease from £454 million as of March 31, 2023. Third-party funds under management amounted to £383 million, with 60% invested in the United Kingdom. The reduction in funds under management is attributed to the sale of a property in a UK fund, reductions in property values, and a weakening of the Euro.
The Group's cash position as of August 31, 2023, was £6.64 million, a decrease from £7.65 million as of March 31, 2023. The reduction in cash was mainly due to capital expenditure at Blue Tower in Warsaw and the cost of buying out minority shareholders in E and S.
The Group remains vigilant to market opportunities, particularly in its new activity as a lender.