Industrials REIT has “ceased investment activity” after buying just £5.2m of assets in the third quarter of 2022.
In a trading update, the REIT said it had completed 20% more new lettings in the quarter than ever before and occupancy stood at 93%.
Chief executive Paul Arenson said: ‘Tenant demand has continued to be strong, with the average uplift in rent upon lease renewal or new letting rising to a new high of 30%.”
However, the REIT said: “We have largely ceased investment activity while the commercial property investment market in the UK adjusts downward due to rising interest rates, high inflation and an increasing risk of recession.”
It added that it would preserve capital and keep its leverage low, while it waited for “an appropriate time to re-enter the market” when values stabilise.
Arenson said: “We continue to watch the market carefully and believe that attractive and accretive acquisition opportunities will emerge once the market has gone through a period of repricing.”
He added that demand for MLI remained “robust”.
“We anticipate that the trading environment will become more difficult over the next 12 months, but to date we have not seen any evidence of this in our portfolio and, with our strong balance sheet, feel well placed to weather the challenges that may lie ahead.”
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