The Local Shopping Reit, a UK real estate investment trust focused on investments in local shopping assets, let 40 retail units generating an annualised total rent of GBP355,770 for the four months to 31 July 2010.

Eight of these lettings incorporate stepped rent increases, with initial rents rising from GBP87,500 to GBP105,000 per annum, against a market rent of GBP97,000 per annum.

The remaining 32 units were let at 1.4 per cent above market rent.

In addition, 91 rent reviews and lease renewals increased annual rental income by more than GBP75,000, producing an 8.3 per cent uplift above market rent.

Planning consent has been obtained for nine flats and a 4,600 square foot retail unit.

During the period Local Shopping Reit purchased 17 properties for GBP8.87m at an average net initial yield of 7.52 per cent.

Recent purchases have included a GBP1.62m parade in Stanwell, Middlesex, incorporating a reversionary convenience store let to Sainsbury’s reflecting a net initial yield of 7.86 per cent, and a GBP0.75m portfolio of six shops in Scotland let to Ladbrokes on six-year leases, reflecting a net initial yield of 8.95 per cent.

It also sold three ex-growth properties for a total of GBP1.85m, 7.1 per cent above their March 2010 valuation.

As a result of these purchases and sales, the company now has a portfolio of 647 properties comprising over 2,000 letting units.

The company has GBP46.4m of undrawn facilities and a cash generative portfolio.

Nick Gregory, Local Shopping Reit’s joint chief executive officer, says: “We continue to maintain our focus on actively working the existing portfolio to maximise income, despite the challenge of uncertain economic conditions, which persist in presenting a challenging retail environment for retailers. Against this backdrop, we are pleased to report strong progress in lettings and lease reviews and renewals during the period.   

“Additionally, we are maintaining a highly selective approach to acquisitions in order to ensure that our purchases provide us with the potential for future rental growth or the opportunity to deliver added value by applying our active asset management skills.”