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(Sharecast News) - Closed-ended real estate investment trust Ground Rents Income Fund announced on Tuesday that it had sold its largest asset for 7.9m.
The company said it had sold its freehold student accommodation property at Lawrence Street in York to a long leaseholder, and forms part of GRIO's new investment policy to sell assets where possible to "optimise the net realisation value of the company's investments".
The price was in line with a valuation at the end of September and reflects a net initial yield of 4.2%.
The asset was part of the security for GRIO's loan from Santander UK. As part of a refinancing deal in March, all proceeds from charged asset disposals will be used to repay debt.
The remaining assets charged to Santander total 31.1m and the bank loan-to-value will be 38.6% compared with a LTV covenant ratio of 50%. The consolidated group LTV following the repayment will be approximately 18.9%, GRIO said.
"Further assets are being marketed for disposal and a full update on progress implementing the new investment policy will be included in the forthcoming year-end results that the company aims to release in December," the company said.
Shares were down 0.1% at 8,099.02p by the close of play on Tuesday.
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