Real Estate

UK property themes to watch in 2021: pathway to net zero emissions – case study

A case study from our 2030 net zero carbon target for the BMO UK Property Fund.
March 2021
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Risk warnings

Past performance is not a guide to future performance.

The value of your investments and any income from them can go down as well as up and you may not get back the original amount invested.

The value of directly-held property reflects the opinion of valuers and is reviewed periodically. These assets can also be illiquid and significant or persistent redemptions may require the manager to sell properties at a lower market value adversely affecting the value of your investment.

BMO UK Property Fund invests in assets that may at times be hard to sell. This means that there may be occasions when you experience a delay or receive less than you might otherwise expect when selling your investment. For more information on risks, see the prospectus and key investor information document.

We purchased this Equinox Building, Dartford, in late 2012. After receiving several years of income, in 2020 it became necessary to take the building back. We used this opportunity to enhance the environmental credentials of the building as part of our pathway towards achieving net zero emissions in the BMO UK Property Fund by 2030.

We worked extensively with our in-house BMO REP sustainability team to use this opportunity to enhance the environmental credentials of the building.

During the design process, we were pleased to be able to further enhance the specification by working with the prospective occupier Pentagon Freight Services plc. Pentagon had identified the building as their new UK headquarters prior to the works completing and signed a 20-year lease, with a break after year 10. The new annual rent of £518,394 has achieved a 31% increase on the rent previously being paid. The works were completed within budget and achieved practical completion on time facilitating the occupiers move to its new HQ.

 

Sustainable results, not just financial

The completion of the project resulted in an increase in asset value to over £10m; a fantastic result for the fund. The environmental improvements are equally as striking and play a very important role in future-proofing the asset and preserving value for future lettings.

Risk warnings

Past performance is not a guide to future performance.

The value of your investments and any income from them can go down as well as up and you may not get back the original amount invested.

The value of directly-held property reflects the opinion of valuers and is reviewed periodically. These assets can also be illiquid and significant or persistent redemptions may require the manager to sell properties at a lower market value adversely affecting the value of your investment.

BMO UK Property Fund invests in assets that may at times be hard to sell. This means that there may be occasions when you experience a delay or receive less than you might otherwise expect when selling your investment. For more information on risks, see the prospectus and key investor information document.

Interested in learning more? Download our viewpoint to discover how we enhanced the sustainability of the building, and the amount of CO2 emissions its saving.

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