Tamar European Industrial Fund, a Guernsey registered closed-ended investment company focusing on industrial property assets in Western Europe and Scandinavia, sold three assets during the first half of the year.

This allowed the net repayment of GBP7.5m of debt and the release of additional cash.

Since the period end, an additional two assets in Finland and three in France have been sold enabling repayment of a further GBP19.5m of debt.

As a result, if all resultant cash balances were applied to reduce drawn debt facilities, Tamar’s current gearing would be 58.3 per cent.

Ongoing leasing activity reflects the strong defensive income profile: 7,919 square metres of new leases were signed representing 1.60 per cent of gross income and 56,860 square metres of lease renewals representing 12.54 per cent of gross income.

The board is deferring making a decision on paying a dividend until the refinancing of the debt facilities is clear.

Giles Weaver, chairman, says: “I am pleased to report that during the first half of 2010, the fund sold three assets which allowed the net repayment of GBP7.5m of debt and the release of additional cash. Furthermore, since then the fund has sold an additional two assets in Finland and three in France allowing the repayment of a further GBP19.5m of debt.

“At 30 June 2010 the portfolio was yielding 7.41 per cent and continues to have a strong defensive income profile. The key asset management focus for the remainder of 2010 is staying close to tenants and assisting them where possible as they deal with the prevailing economic climate. The board remains satisfied that, through the investment manager’s strong local network and specialist in-house property expertise, the fund maintains close links with tenants and both local and national markets and is well placed to consider and mitigate the impact of likely future adjustments.

“The key focus of the board at present is to strengthen the company’s capital structure including refinancing the debt funding in place. The loan facilities, currently amounting to GBP174.4m, expire in three tranches in October 2010, April 2011 and November 2011. We are in advanced discussions with a number of lenders and remain hopeful that a refinancing deal can be achieved at a gearing level that is both attractive to the fund and in line with current market trends.”