Investment Case

Our ambition is to be the best owner-manager and developer of 'industrial' properties in Europe and a leading income-focused REIT. We are aiming to deliver attractive returns for shareholders in the form of a low-risk, progressive dividend stream, supported by long-term growth in net asset value per share.


SEGRO is a UK Real Estate Investment Trust ('REIT'), and a leading owner, asset manager and developer of modern warehousing and light industrial property, as well as of higher value uses such as offices and data centres. It owns or manages 5.7 million square metres of space in £6.0 billion of assets (SEGRO share: £4.8 billion), serving 1,200 customers from a wide range of industry sectors. Its properties are located around major conurbations and at key transportation hubs across eight European countries, principally in the UK, Germany, France and Poland.

Our portfolio is concentrated in areas expected to benefit from strong tenant demand with limited supply of competing product. Our buildings are located on the edge of major urban conurbations and around key transport hubs.

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Demand for warehouse and industrial space has always been influenced by economic growth but is now also affected by structural changes in how businesses service their customers, such as through e-commerce.

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We own, develop and manage warehouse and industrial properties for our customers in the UK and Continental Europe. Our aim is to generate attractive risk-adjusted returns for our shareholder by delivering low risk, progressive income returns (EPS growth) and capital appreciation (NAV growth), through applying our strategy.

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In November 2011, we set out our strategy to address areas of historical underperformance and deliver better future returns to our shareholders.

In order to achieve our goal, we have been creating a portfolio comprising modern warehousing, light industrial and higher value use assets (including data centres, retail assets and offices) which are well located with good sustainability credentials, and which will benefit from a low structural void rate and relatively low-intensity asset management requirements. These assets will be concentrated in the strongest European sub-markets which have attractive property market characteristics, including good growth prospects, limited supply availability, and where we already have or can achieve critical mass.

We believe that such a portfolio should deliver attractive, low-risk income-led returns with above-average rental and capital growth when market conditions are positive, and show resilience in a downturn.

We aim to enhance these returns through development, seeking to ensure that the income 'drag' associated with holding land does not outweigh the potential benefits. This should generate an attractive, income-orientated total property return ('TPR') which, if underpinned by an efficient overhead structure and relatively modest financial leverage through the cycle, should translate into attractive total shareholder returns.

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Our actions are concentrated on delivering against our four strategic priorities:

  1. Reshaping the existing portfolio by divesting assets which do not meet our strategic and financial criteria and reducing non-income producing assets as a proportion of the total portfolio;
  2. Delivering profitable growth and reinvesting in core markets and asset types by taking advantage of attractive development and acquisition opportunities;
  3. Reducing net debt and managing financial leverage over time and introducing further third party capital where appropriate; and
  4. Driving our operational performance across the business through greater customer focus, knowledge sharing, efficiency improvements and cost reductions.

Our KPIs are aligned with our strategic goal to be the best owner, asset manager and developer of industrial property and a leading income-focused REIT which delivers a high-quality and progressive dividend with resilient capital growth.

Our eight KPIs are fundamental metrics for how we measure progress within the business and they play a key role in determining remuneration throughout the organisation.

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Harry Stokes

Harry Stokes

Head of Investor Relations and Research

+44 207 451 9124

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