TR Property Investment Trust plc (the “Company” or the

“Trust”) was formed in 1905 and has been a dedicated

property investor since 1982. The Company is an

The Company seeks to achieve its objective by investing in

shares and securities of property companies and property

related businesses on an international basis, although,

with a Pan-European benchmark, the majority of the

investments will be located in that geographical area. The

Company also invests in investment property located in

the UK only.

Further details of the Investment Policies, the Asset

Allocation Guidelines and policies regarding the use of

gearing are set out in the Strategic Report on page 25 and

Phayre-Mudge has managed the portfolio since 1 April

2011 and been part of the Fund Management team since

1997.

The Directors are all independent of the Manager and

meet regularly to consider investment strategy, to monitor

adherence to the stated objective and investment policies

Report of the Directors on page 41.

The Financial Highlights for the current year are set out

opposite and Historical Performance can be found on

page3. Key Performance Indicators are set out in the

Strategic Report on pages 26 and 27.

from the FCA’s restrictions, which apply to non-mainstream

investment products, because they are shares in an

authorised investment trust.

General shareholder information and details of how to

invest in TR Property Investment Trust plc, including an

investment through an ISA or saving scheme, can be

found on pages 111 and 112. This information can also be

found on the Trust’s website www.trproperty.com

range of vaccine programmes.

The crisis has forced a dramatic change in the way we work,

consume and relax. Over the last year our management team

wide range of property sectors but also their sustainability

once the world reverts to “the new normal”.

Over the last quarter of the financial year under review

and into the start of the new one, we have seen very

dramatic share price movements as investors rotated

from companies offering the safety of secure income

The headline earnings per share figure is slightly deceptive,

earnings before tax were 24% lower than the previous year,

but a significant tax refund and some further prior period

withholding tax recoveries reduced the revenue tax charge

from an effective rate of 11.3% in 2020 to just 1.9% for the

financial year to March 2021. Further details of this are set

out in the Manager’s Report.

The Board has announced a final dividend of 9.00p per

share, bringing the full year dividend to 14.20p per share

expectation of income returning to previous levels in the

medium term, the Board is happy to maintain a modest

level of dividend progression.

Gearing at the end of the year stood at 16.5% having

started the year at 7.6%. Gearing fluctuated considerably

throughout the year, ranging between around 7.6% and

17.8% as market sentiment ebbed and flowed. This

demonstrates the benefit of the flexibility of our borrowing

structure, with a base level supported by our fixed

longer-term debt and the majority achieved through the

revolving credit facilities and exposure through contracts

seat in investors’ minds as they focused on the route to

normalisation across the UK and Europe as the vaccine

programmes rolled out. The UK is clearly ahead of the

curve in this respect and Sterling strengthened steadily

towards our year end in March 2021.

Our policy is to maintain a hedged currency exposure in

line with the benchmark. Sterling represents around 27%

of the benchmark, therefore strengthening Sterling is a

headwind to the NAV.

Income is unhedged and around 66% of our income

The prior year end fell only two weeks after the market

lows following the announcement of the global COVID-19

pandemic and the shares started the new financial year

at a discount of 11.3%. The discount then moved around

between 5% and 15% as market sentiment changed

through the roller coaster ride of lockdowns, easings and

vaccine news. The average over the year was 10.2% but

closed at 6.1%. This closing of the discount over the year

meant that the share price return of 28.3% was well

ahead of the NAV return.

I am grateful to my Board colleagues and to the team

at TR for their support and commitment this year. We

have met in person whenever the law and common

sense allowed and “virtually” when necessary. Though

small, I believe the Board has an excellent balance and

spread of skills and experience appropriate for the Trust’s

objectives. With two relatively new members, and a

change in Chair, I have been keen to allow us all time

to settle into our roles. Even so, I am conscious of the

term of our SID, Simon Marrison whose independence,

year to allow an orderly succession.

This year we have added more information on our

responsible investment approach. For many years we

have maintained a strong position in terms of voting

and engagement supported by our significant stakes in a

number of property companies. Our size in this specialist

area of the equity market has helped ensure that our

views are heard. This engagement has been augmented

they deliver. Any long term support for management will

require companies to exhibit positive momentum across

relevant measures.

The Trust was the winner in the Specialist Equities

category of the Citywire Investment Trust Awards. This is

particularly pleasing as we were in competition with Trusts

specialising in a broad range of equities and alternatives.

The pandemic has had a dramatic impact on the world

and on all aspects of real estate. In some instances this

was an acceleration of trends that were well underway

such as the structural shift to omnichannel retailing. For

others, such as increased remote working, it has been a

equivalent figure (32%) which itself was well ahead of

the year to March 2019 (20%). It has therefore been two

years of elevated portfolio rotation due to market volatility.

Whilst a number of sought after businesses were standing

at premiums to asset value and therefore were able

to raise capital accretively, the ‘Covid’ world meant that

another smaller cohort of companies required emergency

(defensive) capital raises. After Hammerson’s raise in

September came Shaftesbury’s £300m raise at 400p per

share, a 20% discount to the undisturbed share price

and 55% below where it had started 2020. We didn’t

own Shaftesbury prior to the capital raise but took the

opportunity to participate. Given that part of the company’s

at 641p which reflects the enormous change in sentiment

around the reopening of the economy.

Private equity continues to stalk listed property

companies and I reiterate the statement made many

times in these reports over the last decade – if the listed

market persistently undervalues its companies, private

capital won’t be shy about buying it. This year we have

seen various firms build positions in listed companies:

Brookfield (British Land), KKR (Great Portland Estates)

and Starwood (RDI, CA Immo). It is the latter which has

been most active with its stakes. Having acquired 30%

of RDI from its South African based parent company, it

Board at 121p) was 20% below the last published asset

value but 30% ahead of the undisturbed share price. The

board were acknowledging two things – firstly that the

asset valuation was historic and likely to fall further and

secondly that the mixed portfolio, whilst on the road to

improvement under refreshed management, was set to

earlier) was an important contributor to performance given

our holding (2.5% of net assets).

The interest in listed real estate continues to strengthen

as we move into the Spring with a range of existing

companies taking the opportunity to raise capital whilst

their shares trade at premiums to their asset value. This

was capped in March by the first major IPO for over 3

years. CTP, a Central European logistics owner/developer

raised €1bn with the founder diluting from 100%

ownership to 83%. The company has a market cap of

for real estate, the portfolio remained resilient with rent

collection in excess of 90% for all four quarters and with

only limited concessions given to two retail tenants.

During the period the Trust sold its freehold interest in

the Yodel Distribution Centre in North Bristol for £10m

which reflected a net initial yield of 4.5% and a capital

value of £200 per sq ft. This followed the successful

regearing of the lease at the beginning of 2020. The sale

was concluded at a 25% premium to the September 2020

valuation and is 118% above the July 2014 purchase price.

hot pot cuisine. This is their third restaurant opening after

Holborn and Birmingham. This letting concludes a 10 year

transformation of this Bayswater asset where we have

added 16,000 sq ft of new retail space (bringing exciting

brands like Graham & Green and 1 Rebel to the area) as

agreement. As anticipated this will take time. Meanwhile,

we continue to let any of units on the estate which come

vacant on short term leases. The demand for industrial

space has continued to grow over the past 12 months

and central London is no exception. New rents across the

estate are in the high £20s per sq ft and post the year end

we have let the only vacancy to Sweaty Betty, the highly

successful UK leisure and fashion retailer.

Revenue earnings for the current year of 12.25p were 16%

lower than the prior year.

Earnings were enhanced by a tax refund and some further

prior period withholding tax recoveries which reduced the

revenue tax charge rate to only 1.9%. The most significant

contribution by far was a tax refund and interest thereon

resulting from the final settlement of our long running

2010 following a change in UK tax law that all overseas

dividend receipts were non-taxable in the UK from 1 July

2009. There were various challenges running through

the European courts that this treatment of overseas

dividends should be applied to earlier periods. These

have ultimately had some degree of success and last

year HMRC announced that they would settle on the open

computations. We reached agreement with HMRC on our

own open computations just before the financial year end

and the tax repayment has been received.

We increased the capacity on our ICBC loan facility during

the year and the remaining loans were renewed at

existing levels. We did see small increases on margins

We continue to explore new options in all markets.

Post the year end in early May, St Modwen Properties

announced that an offer of 542p per share from

Blackstone, a 24% premium to the last published NAV

had the support of the board. This company has a large

strategic landbank, a high quality logistics portfolio and

a growing housebuilding unit and whilst it was trading

close to its asset value, private equity clearly feels it is

undervalued. This is a reminder, as stated in a number of

previous reports, that the depth of both equity and debt

availability underpins listed company valuations.

1 Net unrealised (loss)/gain on CFD contracts held as balance sheet (creditor)/debtor.

2 Net unrealised loss on total return swap (TRS) contract held as balance sheet creditor.

3 Gross value of CFD positions.

4 Gross value of TRS position.

5 Total investments illustrating market exposure including the gross value of CFD and TRS positions.

Companies shown by country of listing.

> The Investment Portfolio by Country positions set out on page 18 are the physical holdings only included in the investments held at fair value in the Balance Sheet. The

> The Investment Portfolio by Country positions set out on page 18 are the physical holdings only included in the investments held at fair value in the Balance Sheet. The