LondonMetric Porperty plc (LON:LMP) has announced its half year results for the six months ended 30 September 2025.

Income Statement	H1 2026	H1 2025
Net rental income (£m)	221.2	193.1
EPRA earnings1 (£m)	148.6	135.4
IFRS reported profit (£m)	130.3	163.8
EPRA earnings per share1 (p)	6.7	6.6
IFRS earnings per share (p)	5.9	8.0
Dividend per share (p)	6.1	5.7
Balance Sheet	H1 2026	FY 2025
EPRA net tangible assets1 (NTA) (£m)	4,671.3	4,071.0
IFRS net assets (£m)	4,716.0	4,123.9
EPRA NTA per share1 (p)	199.5	199.2
IFRS net assets per share (p)	202.1	202.4

1.        Further details on alternative performance measures can be found in the Financial Review and definitions can be found in the Glossary

Focus on best assets in winning sectors drives rents, earnings and dividend

·      Net rental income increased 14.6% to £221.2m, 3 months’ contribution from Urban Logistics REIT (‘ULR’) takeover

·      EPRA earnings up 9.7% to £148.6m, +1.5% on a per share basis to 6.7p (+28% over two years)

·      Sector leading EPRA cost ratio at 7.7%

·      Dividend increased 7.0% to 6.1p, 111% covered by earnings, including Q2 dividend declared today of 3.05p

Delivering reliable, repetitive and growing income

·      Total property return of 3.3% (50bps outperformance of MSCI), yields flat and ERV growth of 0.9%

·      Like for like annualised income growth of 5.2% (6 months: +2.6%), generating valuation uplift of £29.1m

·      EPRA NTA per share up 0.2% to 199.5p

·      IFRS reported profit of £130.3m (H1 2025: £163.8m)

·      Total accounting return +4.1% (+3.3% including M&A costs)

Portfolio aligned to strongest thematics and mission critical assets

·      Portfolio value of £7.4bn (2025: £6.2bn) with logistics weighting increasing from 46% to 54%

·      £1,298.9m acquired in period (91% urban logistics) including ULR assets, £55.4m acquired post period end (PPE)

·      £185.3m disposed in period, £26.3m sold PPE

Activity enhancing portfolio quality and strength of income

·      WAULT of 16.4 years, gross to net income ratio of 98.5% and occupancy at 98.1% reflecting addition of ULR assets

·      Contractual rental uplifts on 67% of income, down from 77%

·      Top ten occupiers represent 33% of rent, down from 38%

·      Asset management activity added £10m pa of net contracted income

·      Rent reviews +18% on five yearly equivalent basis, with logistics market reviews +27% (5% CAGR)

·      Income uplift expected over next 18 months of £28m, 16% embedded reversion on logistics

·      91% of portfolio EPC A-C rated with 2.5MWp of solar PV added

Scale delivering economies of opportunities and enhancing our debt structure 

·      Successfully completed further £1.2bn of accretive M&A

·      LTV at 35.1%, debt maturity of 4.2 years and cost of debt at 4.1%

·      £730m of new unsecured debt facilities signed and £724m of secured facilities repaid year to date

·      Benefitting from greater debt optionality, credit rating and liquidity in shares

Andrew Jones, Chief Executive of LondonMetric, commented:

“During the period we successfully completed the takeover of two subscale listed businesses which added £1.2 billion of assets and further established LondonMetric as the UK’s leading triple net lease REIT. Our investment in the winning property sectors and assets through our low cost and efficient platform continues to deliver strong income and attractive rental growth. Over the past two years, earnings and dividends per share have both grown by over 27%, putting us on track for our eleventh year of dividend progression as we strive for dividend aristocracy.

“As material investors in the business, management is fully aligned with shareholders and continues to proactively manage the portfolio to ensure it is fit for purpose with high occupier contentment. Despite an uncertain macroeconomic backdrop and elevated swap rates, we have successfully sold £212 million year to date, continuing the sell down of non core assets inherited through M&A. Our increased scale is presenting numerous opportunities, and the sale proceeds have been reinvested into higher quality and growth logistics, convenience and hotel investments – it’s a case of selling your losers and running your winners.”

Chief Executive’s Statement

Overview

LondonMetric is a high conviction triple net lease (‘NNN’) real estate investment trust (‘REIT’) invested in the strongest property sectors with the lowest cost of operations. It has a highly efficient model that delivers reliable, repetitive and growing income returns and passes rental income onto its shareholders in the form of a well covered, progressive and quarterly dividend. It is not only a rent collector but importantly a rent compounder with negligible income interruption from vacancy or developments. This ensures that 98.5% of rental income collected flows to the Company’s bottom line and ultimately onto shareholders via dividends.

We focus on owning mission critical assets in sectors benefitting from macro tailwinds and evolving consumer behaviour – our unique understanding of occupier contentment gives us a competitive edge. This ensures that we deliver income longevity and growth, value accretion and an all weather portfolio that has consistently navigated short term volatility.

Our efficient platform and NNN approach is delivering tangible benefits and enabled us to complete two takeovers in the period adding £1.2 billion of assets. Our four public company takeovers over the past two years have materially increased our scale with assets growing from £3.2 billion in 2023 to £7.4 billion and contracted rent increasing from £159 million to £421 million. The Urban Logistics REIT Plc (‘ULR’) takeover in June significantly upweighted our logistics exposure from 46% to 54%, where urban logistics remains our strongest conviction call with the best income growth prospects. We are pleased with the progress on integrating ULR and unlocking the opportunities from its portfolio using our best in class asset management team.

In an environment with continued polarisation between the winning and losing sectors, our alignment to the winning sectors of logistics, convenience, healthcare, entertainment and hospitality continues to deliver. Healthy occupier activity is maintaining our sector leading income metrics and delivering attractive income growth, whilst our good levels of transactional activity, particularly for smaller assets, is proving pricing transparency. Our approach to income compounding and management’s strong ownership culture ensures that we remain alert, focused but always disciplined.  We want to own the best quality assets and have continued to exit weaker sectors and assets with £212 million sold year to date, of which £95 million are former LXi assets. We run our winners and sell our losers – we call it ‘winning the losers’.

Over the period, we delivered a total property return of 3.3% and a total accounting return of 4.1% (3.3% including M&A costs). Our net rental income increased by 15% and, after a 26.5% increase in the prior period, EPRA earnings per share increased 1.5%. This has allowed us to progress our dividend by 7.0%, which is 111% covered by earnings and puts us firmly on track for an eleventh year of progression. We continue to proactively manage our well hedged debt and benefit from a blended cost of debt of 4.1%, average debt maturity of over four years, an LTV of 35% and £0.6 billion of undrawn facilities.

The uncertain environment is throwing up numerous opportunities for well capitalised businesses and we are seeing a number of attractive opportunities – after all, market uncertainty can be the friend of investors looking for long term value. Scale is a strong competitive advantage as we can transact on larger deals, deliver significant operational benefits, as reflected in our reduced and sector leading EPRA cost ratio of 7.7%, and see financial benefits through greater debt optionality, a strong credit rating and increased liquidity in our shares.

Our activity is delivering on our aim to invest in the winning sectors and further consolidate our position as the UK’s leading NNN REIT with the most efficient and scalable platform.

As the UK’s leading NNN REIT we aim to deliver reliable, repetitive and growing income

We continue to believe that income and income growth are the defining characteristics of long term investment returns. We appreciate the true benefit of income compounding over the longer term, focusing on the quantity, quality and timing of when cash will be returned. Compounding is not intuitive and is often misunderstood and under appreciated. For us, it is as easy as ABC – always be compounding.

We have embraced the REIT structure, fully understanding and appreciating the outstanding outcomes that it can produce. NNN income REITs that invest in quality assets in the strongest sectors and with high occupier contentment can deliver reliable income and growth and are well placed to deliver long term compounded returns.  This is evidenced by the success of NNN REITs in the US and we believe that this is the right way to invest: low cost, high quality, reliably and efficiently delivered without the distractions of great activity, people or risky decision making. After all, hope is not a winning strategy. 

Our portfolio has very strong income metrics. Our annual net contracted rent of £421 million has a long WAULT of 16.4 years, a high occupancy level of 98.1% and minimal property costs with a very high gross to net income ratio of 98.5%. With 67% of income subject to contractual rental uplifts and strong reversion on our urban logistics assets, this is providing certainty of income growth, as reflected in the portfolio’s annualised like for like income growth over the period of 5.2% and its equivalent yield of 6.3%. 

Our strategy is to own quality assets in winning sectors underpinned by strong income and geographies

Our investment thesis is predicated on allocating capital into sectors where it will be treated best by supporting existing mega trends. There is no substitute for being aware, alert and always prepared to pivot.

Our thematic investing has aligned the portfolio to the macro trends of digitalisation, time as a valuable commodity and experiences. Consequently, we have pivoted our investments to the winning real estate sectors of logistics, convenience shopping, entertainment and hospitality. We prioritise ‘mission critical’ assets as occupiers tend to stay longer, invest more and pay higher rents. With 65% of our assets located in the South East and the Midlands, our investments are underpinned by high intrinsic value of land, perpetual demand and limited supply. After all, when you choose real estate where the wind is at your back, you are more likely to be a price setter than a price taker.

We look to acquire quality assets at reasonable prices, add conservative leverage to amplify returns and then aim to hold them for a long time to deliver quality returns, acknowledging that time is the friend of a wonderful portfolio and our contentment with getting rich slowly. This is referred to as the three Cs – collect income, allow it to compound and watch the yields on cost compress.

Our focus on long term compounding, rather than simply growing assets under management, tempers our acquisition activity, limits speculative development exposure and frames our disposal decisions. Buying lowly rated assets cheaply is not our strategy, as these assets tend to over distribute, diluting equity value and creating unnecessary risk, stress and taking up valuable thinking time. This is why we will exit weaker assets which have shorter leases and capital expenditure requirements that are likely to grow faster than net rents. We’d rather pay a fair price for a wonderful asset, than a wonderful price for a fair asset.

This is why we have always avoided office investments. They fail our NNN test with accelerating obsolescence, technological disruption, changing workers’ preferences, high sustainability requirements and shortening leases. It is difficult to have a long term relationship with an office – their beauty fades, their maintenance costs increase, they struggle to remain in demand and quickly their values start to melt away.

Macro events continue to dictate the investment backdrop with liquidity constrained across real estate

The global economic outlook remains highly uncertain which, together with ongoing high levels of geopolitical risk continues to set the scene for the investment market.

The US president’s ‘Liberation Day’ tariffs created significant volatility as investors looked to assess the longer term impact of deglobalisation and increased protectionism. Whilst tariffs continue to create uncertainty, the worse outcomes seem to have been avoided and US inflation has been less affected than feared. Whilst inflation remains sticky, weaker than expected inflation and a weakening US jobs market have allowed cuts in interest rates with bond markets responding favourably.

For the UK, we are cautious on the economic outlook with growth expected to remain anaemic at best, with the delayed budget creating heightened uncertainty. However, with unemployment remaining low and interest rates falling, this suggests that the consumer is not in bad shape, especially with wage increases running ahead of inflation and savings ratios rising.

The impact on the property market from elevated gilts and swap rates has been a sharp reduction in liquidity, especially for larger lot sizes above £20 million. There is no doubt that the pool of buyers for large transactions has narrowed with limited activity from long only UK institutions and US private equity investors, the latter more focused on exiting closed ended strategies. For smaller lot sizes, where debt is rarely an issue, there has been much more liquidity from a wider pool of buyers including private investors, family offices, local authority pension funds and owner occupiers. This has helped us to execute on our sales strategy given our average lot size on sales is £6 million.

On a positive note, we have seen five year swap rates recently fall to 370bps which is approaching levels that should encourage proper liquidity. After all, interest rates remain the yardstick against which most investments are measured. Limited competition in the investment market has allowed us to execute transactions across all of our four areas of opportunities – sale and leasebacks, development fundings, fund expiries/pension fund liquidations and M&A. Our M&A activity in the period saw us buy further quality businesses – ULR and Highcroft Investments plc (‘Highcroft’) – that were no longer fit for purpose in the listed space and that had fallen out of favour. Separately, we recently disclosed an 11.1% investment in Schroder Real Estate Investment Trust Limited.    

Our investment activity has increased our logistics exposure

The logistics sector remains attractive with structural tailwinds from continued online sales growth, investment in more efficient and resilient supply chains and increased warehouse automation. Take up of logistics warehousing in the UK over the first nine months of 2025 reached 20 million sq ft, almost exceeding take up for the whole of 2024. Stronger demand in Q3 2025 saw 8.3 million sq ft of lettings with a further 10 million sq ft under offer at the quarter end.

Greater levels of take up have however not addressed elevated vacancy rates which remain at c.7% nationally and are most prevalent in mid box logistics (100-400k sq ft) where speculative developments have added materially to supply; our vacancy rate in this size bracket is far less at 3% and relates to assets inherited through the ULR takeover. 

We continue to believe that urban logistics remains the most attractive sub-sector and has the greatest demand/supply tension and consequently income growth potential. Supply continues to remain restricted by elevated development costs and continued conversion of urban warehousing into higher value land uses.

Granular occupier demand is benefitting from an ongoing need for businesses to evolve operationally by locating closer to the customer, minimise delivery times, increase accuracy of delivery and satisfy consumer demands for instant gratification. This in turn continues to drive strong urban warehousing rental growth although, as we have planned for, rental tension has lessened in London and new lettings are taking longer to execute nationally.  

The ULR takeover accelerated our ambition to materially grow our urban logistics exposure, adding £1.1 billion of urban warehousing across 130 assets in the period. Along with other acquisitions, including our takeover of Highcroft, our portfolio’s logistics exposure increased significantly from 46% to 54%. In the period, our logistics assets delivered a total property return of 3.1% and saw ERV growth of 1%, with urban again the best sub-sector and delivering strong open market review settlements. Our logistics portfolio remains highly reversionary and this is expected to provide ongoing superior future returns, particularly as construction cost inflation of nearly 40% since Covid suggests that rents need to progress further to make new developments viable.

Whilst we continue to see many logistics investment opportunities, the pricing gap between vendor aspiration and buyer conviction has been wide. The summer saw several large single let platform portfolios hit the market at ambitious pricing, driven by redemptions or refinance pressures. With interest only at discounts, some of these larger portfolios remain unsold or have found alternative avenues to secure an exit. The multi-let warehouse market has seen better activity, but we have consciously reduced our exposure here given higher capex and operational requirements as well as greater SME risk from current economic uncertainty. In the period, our £84 million of logistics disposals focused on geographies with over-supply and assets with lower rental growth potential as well as future vacancy and capex risks. 

Our long income assets are benefitting from structural tailwinds

Our long income portfolio represents 44% of our assets and provides incredible income let to strong operators, with inflation protection and attractive income compounding qualities which form the bedrock of our dividend. It is 99% occupied, offers a topped up NIY of 5.5%, an equivalent yield of 6.7%, a WAULT of 23 years and contractual rental uplifts on 90% of income. In the period, our long income assets delivered a total property return of 3.8%.

This real estate is aligned to structurally supported sectors of convenience, entertainment & leisure and healthcare. These sectors are benefitting from changes in consumer behaviour and demographics as the population pivots expenditure towards convenience, experiences and better healthcare. Strong demand/supply dynamics in these sectors and attractive replacement metrics ensure that these assets are mission critical operating assets for our occupiers.

Across all of our long income markets there has been strong investment demand for good quality long let assets. Although we transacted on several acquisitions in the period, we have missed out on several investment opportunities due to price. We have continued to sell down non core and mature long income assets, always looking to deal from the bottom of the deck and exit weak sub-sectors and poorer quality assets. After all, when you own secondary assets, time can quite often destroy wealth. Year to date, we have sold £104 million of long income assets principally former LXI assets including over sized foodstores, car parks, pubs and care homes.

Convenience is a sector that is benefitting from consumers increasingly seeing their time as a more valuable commodity. In the best locations, we are seeing good rental growth for our convenience assets that is comparable to what we are delivering across our urban logistics portfolio. The store network remains integral to retailers, and our convenience assets are well located, stand-alone or cluster properties that are fit for purpose, right sized and right rented.

Our convenience assets are let on long NNN leases to grocers, discounters, home and DIY operators with resilient business models that are less exposed to the migration of shopping online and offer essential goods and omni-channel optionality in a convenient format. We have consciously avoided experiential retail assets where rents are elevated, credits can be weak and operational capex is high. Roadside convenience has been an area of focus for us, particularly drive-thrus, with a growing need to service customers requiring electric vehicle charging. We now own a substantial number of drive-thrus, let to occupiers such as Costa, KFC, McDonalds and Starbucks. 

Healthcare is underpinned by strong demand drivers from an ageing and growing population as well as improvements in technology, and the real estate investment market in healthcare has been particularly active over the last year. UK private hospitals are particularly well placed and are increasingly taking on NHS patients as a result of growing NHS waiting lists where seven million people are awaiting treatment. Unsurprisingly, they are seeing good demand from patients treated through private medical insurance as well as self-pay as they seek better and faster care. Ramsay Health Care, our largest occupier, continues to report strong growth in its UK business, particularly from NHS admissions. Development activity in the UK healthcare market remains constrained due to elevated construction costs, persistent planning challenges and static land. 

Entertainment & hospitality continues to benefit from the trend towards experiences and growing preference for staycations. We have continued to improve our hotel portfolio with selective disposals and acquisitions. Over the last twelve months we have sold a further five Travelodge hotels and reinvested in larger, better located and strongly performing Premier Inn hotels. Our theme park investments are benefitting from favourable trends and are proving to be non-cyclical performers as consumers prioritise experiences over things and are showing an unwillingness to cut back on discretionary spend in this area. Theme parks also have significant barriers to entry in the UK with large investment required to maintain visitor appeal which adds to their defensive characteristics.

We continue to grow income and improve assets using our expertise and working with occupiers

Our strong occupier relationships allow us to continually assess occupier contentment and demand across our portfolio. During the period, 156 occupier initiatives added £9.8 million per annum of rent and delivered annualised like for like income growth of 5.2%. Lettings and regears added £3.4 million with logistics contributing £2.7 million and income on regears increasing by 26%. Rent reviews added £6.4 million, representing an 18% uplift on a five yearly equivalent basis with urban logistics open market reviews delivering a 27% uplift.

Looking forward, we will benefit from collecting additional income from our highly reversionary logistics assets as well as the guaranteed uplifts on our long income assets with an additional £28 million of rental uplift expected over the next eighteen months from the portfolio. This is in addition to further income growth potential from letting £9 million of vacancy. Therefore, with our current expectation that our financing costs will remain broadly unchanged over the next few years, this rental growth will help to drive our earnings forward. 

We remain focused on leveraging our occupier led model and asset management skills across our enlarged portfolio. Planning consent to develop an M&S food store in Blackpool has been received with the new 21,000 sq ft unit complementing our existing pipeline of M&S stores currently under construction. We are also progressing well with the development of the new 390,000 sq ft M&S distribution facility in Avonmouth. Managing rental exposure to our occupiers is always a key focus for us. Over the period, the proportion of rent from our top ten occupiers fell from 38% to 33%, with exposure to our top three occupiers also falling from 27% to 22%. We expect further reductions particularly following the repayment of debt attached to our Ramsay Hospitals which gives us optionality to look at potential disposals or joint ventures.

Merlin remains a key occupier and, despite evident headwinds for their business globally earlier this year, we remain confident in their business. They have a unique ownership structure and we continue to take significant comfort from the strength and support of its high quality shareholder base in KIRKBI (the Lego family and a 47.5% shareholder), CPPIB, Blackstone and Wellcome Trust. The recent £0.2 billion purchase by KIRKBI of 29 Lego Discovery centres from Merlin firmly demonstrated this strong sponsor support. Merlin’s UK revenues for the first half of 2025 were in line with the prior half year and UK profitability is ahead of last year with strong in-attraction spend and benefits of cost savings. Merlin continues to drive cost efficiencies and investment in our estate with new rides at Alton Towers and Thorpe Park.

Embedding sustainability across our activities continues to be a key focus, driven by our own aspirations as well as those of our stakeholders. We see ourselves as strong stewards of underinvested or poorer quality assets where we can use our expertise to materially improve buildings. The portfolio’s EPC A-C rating reduced slightly from 92% to 91% over the period as a result of our M&A activity, and we added 2.5MWp of solar over the period with a further 2.4MWp of near term solar projects.

Our team’s economic alignment to the Company’s success ensures an ownership culture and a strong conviction to make the right property and financial decisions in conjunction with all of our stakeholders. Over the period we welcomed four new colleagues from ULR and, following a seamless transition, we have fully integrated their systems onto our platform. LondonMetric remains an exciting and dynamic place to work with greater scale and activity creating new opportunities for change and growth. As a larger and growing business, we recognise the importance of investing in our people. We also continue to look at succession planning. Following Valentine Bereford’s decision to retire at the end of the financial year, we have promoted Will Evers to sole Head of Investment. He will continue to work alongside Darren Richards, who joined as Chief Investment Officer in January; Mark Stirling, Property Director; and Andrew Smith, Strategy Director. Our team has breadth and depth.

Outlook

Our NNN income model is delivering strong income and elevated rental growth through a low cost and efficient platform. We believe that this is the right way to invest. Scale and efficiency are essential in today’s environment, and we have every reason to be optimistic following our relentless expansion. Our M&A activity continues to improve liquidity in our shares, expand access to quality investment opportunities and deliver economies in terms of overheads and debt optionality. We have been the biggest player in sector consolidation over the last few years which has propelled our business into the FTSE 100. We expect further opportunities, however, unlike others, we will not seek growth for the sake of it and will only use our equity to acquire high quality assets.

Our position as one of the largest and most respected REITs is not an accident. It is the result of over ten years of building the right portfolio, financial prudence, taking hard decisions over easy ones and assembling a strong team. Unlike some of our peers, we have always been prepared to pivot, with our decisions heavily influenced by macro trends, evolving consumer behaviour and future demand/supply dynamics. Technological innovation is disrupting our own behaviours and so it is naive to think that it is not impacting real estate – we never want to be married to legacy sectors. As the facts change, then so will we – after all no matter how great the intelligence or how hard the work, the macro will always out run the micro.

Therefore, to ensure that our portfolio remains fit for the future with best in class occupier relationships, we will constantly refine its quality and income streams by trimming our exposure to certain sub-sectors, ex-growth assets and individual credits. Logistics remains our strongest conviction for income growth but we remain attracted to other sectors as evolving consumer behaviour continues to provide a strong tailwind for further rental progression. As owners of the business we are fully aligned with shareholders and remain focused on our mission: disciplined and ruthlessly efficient in how we operate, execute and allocate capital across your business. We are on an exciting journey towards dividend aristocracy, recognising that income compounding is a true Wonder of the World – misunderstood, under appreciated, the secret ingredient and the rocket fuel that creates wealth.

Property Review

Our portfolio is aligned to structurally supported assets and is well located

Over the period, £1.2 billion of M&A and further acquisitions increased the portfolio value from £6.2 billion to £7.4 billion and grew its logistics weighting from 46% to 54%. Consequently, our long income weighting which comprises convenience, entertainment & leisure and healthcare assets, fell from 52% to 44% as we continued to sell down non core and ex growth long income assets, primarily former LXi assets.

Portfolio weighting as at 30 September 2025

Logistics	54.0%
Entertainment & leisure	18.4%
Convenience	13.5%
Healthcare & education	12.5%
Other1	1.6%

1 A retail park, four offices and a life science asset

In line with our investment discipline of owning assets in strong geographies with high intrinsic value from the land, the portfolio remains focused on London and the South East (40.0% by value) and the Midlands (24.5%). The rest of England accounts for 27.5% with the largest regions comprising the North West at 9.8%, the North East and Yorkshire at 8.5% and the South West at 6.5%. Scotland, Wales and Northern Ireland account for 6.1% and the remaining 1.9% relates to our theme park asset in Germany.

Our income metrics remain strong, delivering attractive income led property returns

The income security of the portfolio remains very strong with a WAULT of 16.4 years (15.1 years to first break) and only 8% of income expiring within the next three years. Occupancy remained high at 98.1% and our gross to net income ratio of 98.5% continues to reflect the portfolio’s strong retention rate, very low property costs and minimal operational requirements.

Net contracted rent increased significantly over the period from £340.4 million to £421.1 million and, in line with our preference for greater market rental growth exposure, the proportion of rent linked to open market rent reviews increased from 23% to 33%.

At 67%, we continue to have a high proportion of income with guaranteed contractual reviews:

·    47% of rent is index linked: with 25% RPI linked, 13% CPI+ linked and 9% CPI or CPIH linked; and

·    20% of rent is subject to fixed uplifts, with a weighted average uplift of 2.6% per annum.

Index linked reviews have a range of collars and caps typically 1% and 4% over a five-year period such that:

·    For RPI reviews, at 22% inflation over a five-year period (4% per annum), 93% of inflation is captured; and

·    For CPI reviews, at 16% inflation over a five-year period (3% per annum), 99% of inflation is captured.

34% of rent is reviewed annually which is down from 40% at the start of the period.

The portfolio’s EPRA topped up net initial yield is 5.2% (March 2025: 5.1%) and its equivalent yield is unchanged at 6.3%. The Company again delivered an attractive TPR for the period of 3.3%. This represented a 50bps outperformance of the MSCI All Property UK Index. ERV growth for the six months was 0.9% and the portfolio saw a 0.4% property valuation increase with yields largely flat.

Logistics sector review

Our logistics portfolio is spread across the urban, regional and mega sub-sectors. It is valued at £3,987 million, up from £2,838 million at the start of the period, has a WAULT of ten years and occupancy of 97.5%. Our logistics assets are valued at a topped up NIY of 5.0% and an equivalent yield of 6.1%.

Logistics portfolioAs at 30 September 2025	Urban	Regional	Mega
Value1	£2,930m	£741m	£316m
Net contracted rent	£159m	£37m	£16m
WAULT	9 years	14 years	14 years
Average rent (psf)	£8.50	£6.80	£6.50
ERV (psf)	£9.60	£8.20	£8.50
ERV growth (H1)	1.1%	0.7%	0.8%
Topped up NIY	5.0%	4.9%	4.6%
Percentage of rent with contractual uplifts	34%	74%	100%
Total property return (H1)	3.1%	3.5%	2.8%

1   Including developments

Urban logistics has been our strongest conviction call sector for a number of years. Over the period, this part of the portfolio grew significantly from £1,796 million to £2,930 million, predominantly as a result of the Urban Logistics REIT Plc (‘ULR’) takeover. Our urban assets are spread across 295 locations and now account for 73% of our overall logistics weighting. Two thirds of our urban rent now has market linked rent reviews which is up from 53% at the start of the period. Demonstrating our focus on strong geographies, half of our urban logistics is located in London and the South East and a further 27% is located in the Midlands.

Over the period, logistics delivered a TPR of 3.1% and saw a valuation uplift of 0.6%, reflecting continued market rental growth as well as strong logistics leasing and rent review activity. Yields remained flat across our three sub-sectors and ERVs grew by 1.0%. Urban logistics again generated the strongest ERV growth of 1.1%, whilst regional and mega saw an average increase of 0.7%.

Average ERVs on our logistics portfolio are 16% higher than average passing rents, with urban logistics assets at 13% and regional and mega assets at 26%. The higher reversion on regional and mega assets reflects their greater exposure to index linked or fixed reviews as well as their longer leases, which over the short term reduces our ability to capture the strong market rental growth seen over recent years. 

Long income sector review

Our long income assets are let on long leases to best in class operators, have low operational requirements and are in structurally supported sectors that are benefitting from the changes in the way people live and shop. They are spread across the convenience, entertainment & leisure and healthcare sectors.

As at the period end, the value of our long income assets was broadly unchanged at £3,279 million, representing 44% of the portfolio. These assets are 99% occupied, let with a WAULT of 23 years and generate an attractive topped up NIY of 5.5% with 90% of income subject to contractual rental uplifts and an equivalent yield of 6.7%.

Long income generated a TPR over the period of 3.8% with valuations flat. ERV growth was 0.9% with convenience assets seeing the strongest ERV growth at 1.2%.

Long Income portfolioAs at 30 September 2025	Entertainment& leisure	Convenience	Healthcare& education
Value1	£1,361m	£998m	£920m
Net contracted rent	£85m	£59m	£51m
WAULT	35 years	12 years	14 years
Topped up NIY	5.7%	5.6%	5.2%
Percentage of rent with contractual rental uplifts	97%	68%	100%
Total property return (H1)	4.1%	3.9%	2.8%

1 Including developments

Entertainment & leisure represents 18.4% of the portfolio and comprises:

·    Theme parks – 46% of sub-sector – four assets at Thorpe Park (490 acres), Alton Towers (550 acres), Warwick Castle (100 acres) and Heide Park (in Germany, 210 acres). These assets are let with a WAULT of 52 years to Merlin Entertainments, with annual CPI+0.5% rent reviews on the UK assets and annual fixed rent reviews of 3.3% per annum on Heide Park. 20% of our rent is derived from Merlin’s hotels with accommodation bookings an increasingly important driver of growth for Merlin. In total, the sites have c.7 million visitors per year and are valued at an average of c.£0.5 million per acre;

·    Hotels – 33% of sub-sector – 80 budget hotels, including 65 let to Travelodge with a WAULT of 24 years, mainly on five yearly CPI+0.5%/RPI linked reviews, and 13 let to Premier Inn with a WAULT of 21 years. Our hotels are nationwide and focused on roadside locations; and

·    Other – 21% of sub-sector – consists mainly of 20 pubs, five cinemas, three garden centres and the AO Manchester Arena, which is mostly let to SMG Europe for a further 20 years.

Convenience represents 13.5% of the portfolio and comprises:

·    Foodstores – 43% of sub-sector – 46 assets let at an average rent of £18.80 psf with key occupiers including M&S, Waitrose, Co-op, Costco, Tesco and Aldi. These are predominantly smaller format stores averaging c.30,000 sq ft;

·    NNN retail – 31% of sub-sector – 40 assets, primarily single or cluster assets let to discount, essential, electrical and home retail occupiers such as B&M, Currys, DFS, Dunelm, Home Bargains, Pets at Home and The Range at an average rent of £17.30 psf. These assets typically benefit from high alternative use values;

·    Roadside – 15% of sub-sector – 71 assets, primarily convenience stores with attached petrol filling stations, drive-thru coffee outlets and automated car washes. Key occupiers include Co-op, IMO, BP, McDonalds, MFG and Starbucks; and

·    Other – 11% of sub-sector – 21 trade/DIY stores and autocentres (key occupiers include Halfords, Kwik Fit, Topps Tiles and Wickes) and eight car parks let to Q-Park with a WAULT of 27 years.

Healthcare & education represents 12.5% of the portfolio and comprises:

·    Hospitals – 86% of sub-sector – 12 private hospitals, of which 11 are let to Ramsay Health Care with a WAULT of 12 years and annual fixed rent reviews of 2.75%. The two largest hospitals are in Sawbridgeworth and Chelmsford with over half the hospitals located in the South East;

·    Care homes – 8% of sub-sector – six assets mainly let to Bupa and Priory with a WAULT of 19 years; and

·    Education – 6% of sub-sector – 25 children’s nurseries and adventure centres and one student asset.

Investment activity

Including assets acquired through the ULR and Highcroft Investments plc (‘Highcroft’) takeovers, acquisitions in the period totalled £1,298.9 million, of which 91% were urban logistics assets. 162 assets were acquired with a NIY of 5.4% and a reversionary yield of 6.7%. They had a WAULT of 8.5 years and 75% of income has open market rent reviews.

In logistics, 139 assets were acquired for £1,187.1 million:

·    130 urban warehouses, acquired for £1,134.5 million through the ULR takeover. The 10.1 million sq ft portfolio generates £64.7 million per annum of rent, 82% of which is subject to open market rent reviews. The assets have a WAULT of eight years and 63% are located in London, the South East and the Midlands;

·    Seven warehouses, acquired for £33.5 million through the Highcroft takeover. The 507,000 sq ft of predominantly urban assets generate £2.5 million per annum of rent, have a WAULT of six years and 42% are located in London, the South East and the Midlands;

·    An 80,000 sq ft logistics development funding in Malton, acquired for £10.7 million and pre-let to Severfield Plc on a new 20 year lease with annual rent reviews linked to CPI; and

·    A recently developed and reversionary 68,000 sq ft logistics warehouse in the West Midlands, acquired for £8.3 million and let for a further 12 years to Bilco Access Solutions, part of Quanex.

In entertainment & leisure, seven assets were acquired for £51.4 million:

·    A portfolio of five modern Premier Inn hotels was acquired from Whitbread PLC for £44.4 million. Let on new 30 year leases with five-yearly rent reviews linked to CPI, the assets are located in Chatham, Exeter St David’s, Penzance, Southampton and Witney and total 446 bedrooms, all recently refurbished; and

·    Two gyms were acquired for £7.0 million through the Highcroft takeover.

In convenience, 14 assets were acquired for £56.0 million:

·    11 NNN retail/roadside assets, acquired for £36.1 million from the Highcroft takeover, most of which are located in London, the South East and Midlands and include units let to Booker, Wickes and Pets at Home;   

·    A 21,000 sq ft convenience development funding in Ludlow, acquired for £7.6 million and pre-let to M&S on a new 15 year lease with five-yearly rent reviews linked to RPI;

·    A 40,000 sq ft convenience asset in Tunbridge Wells, acquired for £7.5 million and let to Booker for a further 14 years with five-yearly fixed rent reviews of 3% pa; and

·    A 4,000 sq ft Greggs and Starbucks convenience development funding in Eastbourne, acquired for £4.8 million.

Other assets acquired through the Highcroft takeover totalled £4.4 million and comprised two offices.

Post period end, we have acquired £55.4 million of assets mainly comprising a £51.1 million portfolio let on very long leases with a WAULT to first break of over 100 years. The portfolio generates £2.2 million of rent per annum, which is substantially below market rent of £8.2 million per annum, and consists of:

·    A state-of-the-art and highly automated 450,000 sq ft airside logistics facility at East Midlands Airport let to UPS with CPI linked rent reviews. Developed by UPS at their own cost, the facility is their second largest cargo facility in Europe and serves as their primary gateway in the UK; and

·    The Clayton hotel at Manchester Airport with 365 beds and RPI linked rent reviews. The hotel performs strongly due to its airport proximity, with planning consent to build a 214-bed extension.

Disposals in the period totalled £185.3 million, reflecting a NIY of 5.7%. Across 25 assets, they were let with a WAULT of 13 years and sold in line with book values. £91.6 million of sales related to the continued sell down of non core assets previously acquired through the LXi takeover.

In logistics, nine assets were sold for £84.3 million:

·    A vacant 290,000 sq ft regional logistics warehouse in Sheffield, sold to an owner occupier for £26.0 million;

·    A 161,000 sq ft multi-let urban logistics asset in Crawley, sold for £21.4 million;

·    Five urban logistics assets in the Midlands, Newcastle, Perth and Bedford sold for £21.3 million, three of which are former ULR assets with a weighted average term certain of two years; and

·    A 32,000 sq ft urban logistics asset together with a car park asset, both let to Ocado for a further three years in Walthamstow, sold for £15.6 million.

In convenience, six assets were sold for £80.5 million:

·    A 125,000 sq ft Sainsbury’s supermarket in Middlesbrough, sold for £41.0 million;

·    Two car parks let to Q-Parks, sold for £24.5 million;

·    Two Wickes stores in Wigston and Carlisle, sold for £8.2 million; and

·    A 25,000 sq ft foodstore in Scotland, sold for £6.8 million.

Other sales totalled £20.5 million and comprised:

·    Seven entertainment & leisure assets, sold for £11.2 million comprising six pubs and a Travelodge; and

·    Two healthcare & education assets (care home and children’s nursery) and a former Highcroft vacant office in Cardiff, sold for £9.3 million.

Post period end, we have sold a further nine assets for £26.3 million, five of which are former ULR assets. We have another £58 million of assets under offer. We have now sold 65 former LXi assets for £275 million.

Occupier activity

Asset management continues to generate attractive income growth as we work in partnership with our occupiers. During the period, we undertook 156 occupier initiatives adding £9.8 million per annum of rent and delivering an annualised like for like income growth of 5.2% (2.6% for the half year period).

29 lettings and regears were signed in the period with a WAULT of seven years, adding £3.4 million of rent per annum. Long income and other lettings added £0.7 million of rent with a WAULT of 15 years. Logistics lettings and regears added £2.7 million and were signed with a WAULT of six years comprising:

·    Eight new urban lettings added £1.4 million of rent, the largest letting was a 70,000 sq ft warehouse in Luton of recently vacated space which was re-let at 72% above rent previously paid; and 

·    Eight urban regears which added £1.3 million of rent at 26% above previous passing rent. Four of the regears related to former ULR assets.

At the period end, 1.0 million sq ft was vacant, of which 0.7 million sq ft related to former ULR assets. The largest vacancy is 0.5 million sq ft of warehousing in Melton Mowbray.

127 rent reviews were settled in the period, adding £6.4 million per annum of rent at an average of 18% above previous passing on a five yearly equivalent basis with open market reviews 24% higher. 

Logistics rent reviews totalled 34 and added £1.6 million of rent at 17% above previous passing rent on a five yearly equivalent basis. These reviews comprised:

·    28 urban reviews settled at 22% above passing rent on a five yearly equivalent basis with open market urban reviews delivering a 27% uplift (a 4.8% CAGR);

·    Five regional RPI linked reviews, predominantly annual reviews, settled at 18% above previous passing on a five yearly equivalent basis; and

·    One mega fixed review settled at 8% above previous passing rent on a five yearly equivalent basis.

Long income rent reviews were settled across 93 units, adding £4.8 million of rent at 18% above previous passing rent, on a five yearly equivalent basis. All but six reviews were contractual rental uplifts and the deals comprised:

·    26 entertainment & leisure reviews, adding £2.4 million, of which £1.6 million related to theme parks;

·    52 convenience reviews, adding £1.2 million; and

·    15 healthcare & education reviews, adding £1.2 million, most of which related to our Ramsay Hospitals.

Over the next eighteen months, with the benefit of contractual uplifts, material rent review uplifts on our logistics portfolio and other active asset management initiatives, we expect to add £28 million of additional income. Full letting of our vacant space would add a further £8.8 million of rent.

We remain focused on working in partnership with our occupiers to provide fit for purpose real estate and upgrade the quality of our assets.

We continue to work closely with M&S and have gained planning consent to develop a 21,000 sq ft M&S food store in Blackpool which is expected to complete in summer 2026. The new unit will complement our existing pipeline of M&S stores currently under construction in Weymouth (41,000 sq ft and BREEAM Excellent), Luton (15,000 sq ft), Largs (13,000 sq ft) and Ludlow (21,000 sq ft and BREEAM Very Good), most of which are expected to complete in Q1 2026. We are also progressing well with the development of the new 390,000 sq ft M&S distribution facility in Avonmouth, which is expected to be BREEAM Excellent certified and to complete next summer.

Sustainability is embedded into all our asset management activity and we continue to see good occupier engagement and activity on implementing environmental initiatives to improve the quality of our assets. Despite our M&A activity in the period, our EPC ratings across the portfolio were broadly unchanged with ‘A-C’ at 91% and ‘A-B’ at 57% (March 2025: 92% and 58% respectively). We see good opportunity on both our portfolio and the ULR assets to implement further asset improvements that will help to improve EPC ratings and contribute towards our Net Zero Targets.

In the period, 0.8MWp of solar PV was added on the existing portfolio which, together with the 1.7MWp of solar added through the ULR takeover, has increased our total installed capacity to 10.6MWp. 18% of the portfolio by area now has solar and there are a further four solar projects underway with another eight near-term potential initiatives, together totalling 2.4MWp.

Our ESG activity has seen us maintain our GRESB score of 73 and two star rating.

Income from our occupiers

Over the period, we reduced the income concentration from our top ten occupiers from 38% to 33% with exposure to our three largest occupiers (Ramsay, Merlin and Travelodge) also falling from 27% to 22%. 

Top ten occupiers (% of net contracted income)

Ramsay Health Care	9.3%
Merlin Entertainments	8.0%
Travelodge	5.0%
M&S	1.9%
Great Bear	1.7%
Booker	1.6%
Tesco	1.5%
Primark	1.5%
Premier Inn	1.5%
Amazon	1.3%
Total	33.3%

In respect of our two largest occupiers, we believe that these are best in class operators with robust business models occupying key operating assets and investing materially in their estate:

·    Ramsay Health Care provides quality healthcare globally with 14 million admissions and patient visits per annum in over 500 locations. Ramsay is listed on the Australian Stock Exchange valued at £4 billion. In the UK, Ramsay is one of the leading independent healthcare providers with 34 acute hospitals caring for approximately 200,000 patients per annum and employing 7,500 people. UK revenues in the last financial year were 13% higher at £1.3 billion, driven by a strong increase in NHS admissions and private pay patients; and

·    Merlin Entertainments is a global leader in branded entertainment destinations with c.63 million visitors per annum. It operates 135 attractions in over 20 countries, including Alton Towers, Thorpe Park and Warwick Castle in the UK which are owned by LondonMetric. Merlin recorded global revenues of £2.1 billion in 2024 and is owned by the Lego family, Blackstone, Wellcome Trust and Canada Pension Plan Investment Board.