
Ordinary Shares

Price (p)	149.40
Published NAV	171.60
Yield	3.89
Discount	-13.84

Prices correct as of close 2010-09-09. Last Published NAV is as at the previous business day. Source: Trustnet

Sigma Shares

Price (p)	66.90
Published NAV	88.60
Yield	2.99
Discount	-25.20

Prices correct as of close 2010-09-09. Last Published NAV is as at the previous business day. Source: Trustnet

For Ordinary Shares

March 2006
March saw a further strong advance in European property share prices capping off an excellent first quarter. The Trust also benefited, at the end of the month, from the half yearly external revaluation of our direct properties. This produced a gain of around 10% (£6m) over the September 2005 values.

The major news in the month was the introduction of UK REITs in the budget. Many in the industry, including ourselves, had voiced concern over the commercial viability of the preliminary terms announced last December. In the event, the details announced in the Budget included a number of important changes and the entry fee, at 2% of gross assets, is not expected to been seen as barrier by any of the major UK companies. Some details still need further clarification and will be subject to further industry lobbying, but overall the announcement was significantly more robust than we anticipated.

UK property shares greeted the REIT terms with an 8% rise on Budget day. By the end of March they had lost half the gain and by Easter week they were back to their pre-budget price levels. So was it really a damp squib? We don’t think so. We believe the entry costs are a very modest expense when set against the removal of existing and future gains tax liabilities and, inside a REIT structure, UK property companies will be able to adjust their investment policies to greatly benefit future asset and dividend growth. We are retaining our overweight in the UK sector.

P.S. We are regularly asked if TR property intends to become a REIT. The answer is no, firstly because, costs aside, we should only qualify as a REIT if over 75% of our assets were physical property, and secondly because our investment trust status already gives us freedom from capital gains tax.