June 2025

Pan-European real estate equities enjoyed a positive month with the benchmark gaining 2.2%. The Trust’s net asset value (NAV) slightly lagged, adding 2.0%, but the share price saw a gain of 3.3% as the discount (between share price and NAV) continued to tighten (close), albeit slowly. Relative to the wider European equity landscape the sector did well, with the broader STOXX 600 falling -1.2%.

At a country level, the best performing markets were Germany (3.5%) and Sweden (3.8% in krona). The Swedish market was buoyed by a further interest rate cut from the Riksbank, which while widely expected was still supportive. There were multiple capital raises in Sweden, with Cibus (4.4%) raising SEK1bn through an accelerated bookbuild (the process during which the price of a security is determined ahead of its public offering) at just a 3% discount to historic NAV and a whopping 25% premium to their March 2025 NAV. Logistea (3.3%) raised SEK 500m, also at a 3% discount, which was encouraging for this fledgling but fast-growing logistics platform. At the other end of the quality spectrum, Corem (2.5%) raised SEK930m, issuing shares at an 8.3% discount to NAV which resulted in 13.7% dilution to existing shareholders. The biggest local winners were two microcaps, K-Fast (25.9%) and Swedish Logistics Property (SLP) which the Trust doesn’t own.

In Germany, it was the turn of the most highly leveraged German business Aroundtown (11.2%) to top the charts given the ‘risk on’ backdrop over the month as fears of global tariff damage continued to fade.

In the UK, the various ongoing M&A sagas ebbed and flowed with PHP successfully getting the board of Assura to switch recommendation from the KKR cash offer to their sweetened cash-and-shares bid. We remain firmly of the view that these assets will perform well under PHP’s management rather than selling out to private equity at close to current asset value. Another board also performed an appropriate volte face, with Warehouse Reit shares (12.3%) responding positively to their board switching recommendation to a cash-and-shares bid from Tritax Bigbox, trumping Blackstone’s recently reduced offer of 109p. Tilstone, the external manager of Warehouse Reit, has the same owner as Ironstone, the manager of Life Science Reit (9.9%). Life Science Reit is under a strategic review and the share price responded to the announcement that Achilles (an activist investor in the property sector) had a disclosable position. Whilst a near 10% gain is good news for investors, the stock still trades at less than half its IPO price (100p, November 2021).

In Belgium, Aedifica (-0.7%) finally reached agreement with Cofinimmo (1.8%) on an exchange ratio for the merger of the two companies, which will create the world’s fourth-largest healthcare REIT. We applaud this development which will deliver enhanced efficiencies of scale and greater share liquidity.

Our most successful trade of the month was an off-benchmark investment in a Spanish housebuilder, Neinor (17.5%) which was raising equity as part of its takeover bid for fellow Iberian housebuilder, Aedes. The €230m issue was at €15.25 per share and the stock ended the month at €16.62.

Over the month the fund increased its active weight by 2% primarily through the purchase of Neinor, but also added to WDP (Continental Industrials), Social Housing Reit (under new management) and British Land (a switch out of Landsec). We took profits in Klepierre and Unibail following the very strong performance of European shopping centres over the quarter.

The end of June marks the end of the first quarter of the Trust’s financial year (FY26) with a very strong set of figures. The NAV total return was 13.4%, whilst the benchmark rose 13.0%. More notable was the share price total return of 17.5% over the quarter. 

	2025/2026	2024/2025	2023/2024	2022/2023	2021/2022
NAV (Inc)	– 0.5	11.6	22.5	– 19.3	– 16.5
Benchmark	– 0.1	9.7	21.4	– 19.8	– 21.5
Share Price	– 2.0	13.8	22.5	– 24.5	– 13.5