- Real estate investor UK Commercial Property REIT posted a fall in annual profit after it recorded losses on the value of its investments, though its underlying earnings improved.

The company held its dividend steady at 3.68p per share.

Pre-tax profit for the year through December dropped to £1.7m, down from £58.8m on-year.

EPRA earnings per share, an underlying measure of performance, rose 16% to 3.50p on the back of higher rental income.

'The outlook for the UK economy and the UK real estate market is fluid at the time of writing but there is no doubt both will suffer substantially due to the impact of COVID-19,' chairman Ken McCullagh said.

'The duration and extent of this downturn depends on how quickly the pandemic is brought under control and both the global and UK economy return to some sort of normality, supported by the mass stimulus and wage underwriting mentioned earlier.'

'A further consideration is the approach to Brexit and whether the UK government continue to insist this will need to be finalised by the end of 2020.'

McCullagh said UK property values had been impacted in the first quarter of 2020, declining by 3.1% on a like-for-like basis, with rent collections for the second quarter standing at 68% as at 24 April.

He added, however, that the UK market had strong fundamentals, both at a property and corporate level.

UK Commercial Property REIT recently announced a 50% reduction in its first-quarter dividend.

'It should be highlighted that there is a clear aspiration to use the strength of the company’s balance sheet and financial resources to ensure a dividend payment continues to be made throughout this period of uncertainty,' McCullagh said.

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