PALACE Capital plc has released an update regarding its recent property disposals and debt reduction efforts since its last announcement on 7 February 2024 reports UKREIF.Com

The company has successfully sold five investment properties for a total of £15.3 million. These transactions, which include notable properties like Kiln Farm in Milton Keynes and Sandringham House in Harlow, were completed slightly below their 2023 valuations but have bolstered the company’s financial flexibility.

These sales have positioned Palace Capital to explore various options for returning capital to shareholders, including potential tender offers. The company also mentioned that additional properties are under offer, which could further enhance shareholder returns in the coming months.

In addition to the property sales, the company has made significant strides in reducing its debt. Since 1 April 2023, Palace Capital has repaid £56.0 million in floating rate debt, leaving only one fixed-rate debt facility at 2.9% due until July 2026. As a result of these efforts and ongoing property sales, Palace Capital now finds itself in a net cash position, with gross debt standing at £8.3 million against cash reserves of £29.2 million as of 17 April 2024. This financial status is expected to support further capital returns to shareholders.

Moreover, since the initiation of its share buyback program in July 2022, the company has returned £21.9 million to shareholders, purchasing approximately 8.8 million shares at an average price of 248 pence per share.

Steven Owen, Executive Chairman of Palace Capital, commented on the update: “Despite the challenging conditions in the property and financial markets, our proactive disposal strategy has significantly strengthened our financial standing. We are now well-positioned to deliver a substantial return of capital to our shareholders, likely through a tender offer, ahead of our preliminary results for the fiscal year ending 31 March 2024, which we will report in June.”