The following amendment has been made to the dividend details in the "Half-year Report" announcement released on 27 November 2020 at 7.00am under RNS No 6925G.

The original RNS stated under the heading 'Dividend' that the shares will be quoted ex-dividend on 10 December 2010. The correct date is 10 December 2020.

All other details remain unchanged.

The full amended text is shown below.

This announcement and the information contained herein is not for publication, distribution or release in, or into, directly or indirectly, the United States, Canada, Australia or Japan.

TR PROPERTY INVESTMENT TRUST PLC

Financial Report for the half year ended 30 September 2020

27 November 2020

1 Net debt is the total value of loan notes and loans (including notional exposure to contracts for difference ("CFDs") and in prior year Total Return Swap) less cash as a proportion of net asset value ("NAV").

2 The NAV Total Return for the year is calculated by reinvesting the dividends in the assets of the Company from the relevant ex-dividend date. Dividends are deemed to be reinvested on the ex-dividend date as this is the protocol used by the Company's benchmark and other indices.

3 The Share Price Total Return is calculated by reinvesting the dividends in the shares of the Company from the relevant ex-dividend date.

4 Ongoing Charges are calculated in accordance with the AIC methodology. The ratio for 30 September 2020 is based on forecast expenses and charges for the year ending 31 March 2021. The performance fee included in the calculation above is the provision at 30 September 2020 referred to in note 2 rather than an estimate of the fee at the year end.

5 Considered to be an Alternative Performance Measure as defined in the full Half Year Report.

Dividend

An interim dividend of 5.20p (2019: 5.20p) will be paid on 8 January 2021 to shareholders on the register on 11 December 2020. The shares will be quoted ex-dividend on 10 December 2020.

Chairman's Statement

Introduction

For the six months to 30th September, the Trust delivered a healthy NAV total return of 14.8%, well ahead of the benchmark total return of 9.8%. The share price total return was 11.3% as the discount to the underlying asset value widened slightly over the period.

Whilst these figures are comfortingly positive, they are a six-month snapshot which commenced shortly after the equity market had fallen sharply. Since then there has been a steady recovery in pan European real estate equity share prices as investors took comfort from significant central bank stimulus and state aid for corporates and individuals.

The COVID-19 crisis has forced a dramatic change in the way we work, consume and relax. It has also had a huge impact on how businesses and consumers use their real estate. For some sectors this has driven an acceleration in trends which were already underway; for others the impact may prove only temporary. The immediate disruption has affected the ability of many tenants to pay their rent whilst for others sustained, or even growing, income has stimulated investor demand. The gulf in valuation between winners and losers has rarely been wider.

Our manager has focused on those businesses with the most sustainable income. Our closed ended, permanent capital structure, as an Investment Trust, has again proved its worth with our ability to acquire shares and take a longer-term view when others are driven to sell.

As far as our own operations are concerned, the business continuity arrangements of the Manager and other third party service providers have proven robust and operations have been able to continue largely as normal.

Revenue Results and Dividend

Revenue earnings for the first half are 7.65p per share, a reduction of 23% from the 9.96p achieved at the same stage in 2019. This reflects the cuts and suspensions of dividends that many companies announced early in the year.

Even so, the Board has announced a maintained interim dividend of 5.20p, the same as the prior year.

Revenue Outlook

Shareholders will remember from previous years that around two thirds of the full year income is usually earned in the first half. Hence, at the time of writing the Board has a reasonably clear understanding of the revenue for the remainder of the current financial year to March 2021. Although the income for the full year will be lower than the prior year, the Board expects to maintain the dividend for the current financial year at a similar level requiring a partial distribution from revenue reserves.

The Board has been cautious with distribution levels for much of the last decade and the Company thus has the benefit of substantial revenue reserves (14.13p per share after payment of the 2020 final dividend) which can be utilised to supplement income and sustain dividend levels until the longer-term picture is clearer. Over the medium term, the Board will clearly assess the sustainable level of dividend once the longer-term earnings capability of the portfolio is established.

The outlook beyond the current financial year remains extremely difficult to predict. The Manager has focused on stocks producing a reliable income stream and the companies able to deliver this have been in demand driving up capital values. I remind shareholders that the Trust aims to outperform its benchmark in total return terms. At some point the stocks delivering reliable income may become overvalued and the potential for superior capital returns in the unloved sectors becomes too great for us to ignore, which would cause the Trust's revenues to fall.

Net Debt and Currencies

Gearing at the end of September was 16.8%, increasing from 7.6% at the end of March 2020.

Currencies continue to be volatile and we expect this to remain the case as the UK edges towards a deal or no deal Brexit. This will have some impact on the income received in the second half, with a weakening Sterling increasing the value of earnings from non-Sterling holdings and vice versa if Sterling strengthens. There will also be an impact on the capital valuation of the portfolio which has 73.7% of exposure to non-GBP denominated assets. Full details of currency exposures are set out in the full Half Year Report.

Discount and Share Repurchases

The discount of the share price to the net asset value widened over the period from 11.3% at 31 March to 14.2% at the end of September. The average discount over the six-month period has been 11.6% although the shares have traded in a wide range between 4.1% to 16.1% as should be expected in such turbulent markets.

There were no share repurchases in the half year period.

Outlook

Europe is experiencing a second wave of COVID-19. Local, regional and even national lockdowns have been re-imposed on many millions of people, yet European stock market indices are higher than they were in May 2020. Markets are forward looking. The US election outcome reflects the prospects of further reflationary spending and an initial trade deal (of sorts) looks tantalisingly close for the EU and the UK.

The huge central bank and fiscal stimulus packages across the globe have driven fixed income yields through the floor while the disruption to business activity has resulted in heavy cuts to dividends across a broad spectrum of listed companies. Sustainable investment income is in short supply and those businesses which can deliver - and we are invested in many - will continue to be attractive. For the future, the news on several potential vaccines is hugely encouraging. Their suitability for a fast roll-out to those most at risk would quite rapidly enable large parts of the economy to return to a more normal conditions. This could engender a wholesale return to the office and recovery in hospitality with tourism benefitting once broader population are inoculated. The consequential benefit to the real estate sector has already been felt in share prices in the last couple of weeks.

Although it may seem a little perverse, given the difficult conditions we are all currently enduring, the outlook for real estate equity pricing has improved. The dispersion of returns since March has been so wide that valuations are potentially becoming attractive in some of the least loved sectors of the market. Everything revolves around income security. This presents opportunities for a closed-ended structure where we can selectively acquire such names alongside our core, secure income portfolio.

David Watson

Chairman

26 November 2020

Interim Management Report

The Chairman's Statement above and the Manager's Report below give details of the important events which have occurred during the period and their impact on the financial statements.

Principal Risks and Uncertainties

The principal risks and uncertainties facing the Company and an explanation of these risks and how they are managed are set out in the Annual Report and Financial Statements for the year ended 31 March 2020 on pages 28 to 31 (which can be found on the Company's website www.trproperty.com).

The principal risks and uncertainties have not changed since the date of that report. The ongoing situation regarding COVID-19 continues to develop, the impact of this on the results for the six months to 30 September 2020 is covered comprehensively in the Chairman's and the Manager's report together with the consequential positioning of the investment portfolio.

Going Concern

As stated in note 5 of the financial statements, the directors are satisfied that the Group has sufficient resources to continue in operation for the foreseeable future, a period of note less that 12 months to the date of this report. Accordingly, the going concern basis is adopted in preparing the condensed financial statements.

Related party transactions

Related party transactions are disclosed in note 8 to the financial statements. There have been no material changes in the related party transactions described in the last annual report.

Directors' Responsibility Statement

The Directors acknowledge responsibility for the interim results and approve this Half-Yearly Financial Report. The principal risks facing the Company are substantially unchanged since the date of the Annual Report for the year ended 31 March 2020 and continue to be as set out in that report.

The Directors of TR Property Investment Trust plc confirm that to the best of their knowledge:

(a) the Half-Yearly Financial Statements have been prepared in accordance with IAS 34 and give a true and fair view of the assets, liabilities, financial position and profit for the period of the Group as required by the Disclosure Guidance and Transparency Rules ("DTR") 4.2.4R;

(b) the Chairman's Statement together with the following Manager's Report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

(c) the report includes a fair review of the information required by DTR 4.2.8R.

On behalf of the Board

David Watson

Chairman

26 November 2020

The Board members as at the date of the announcement are listed on page 27 of the full Half Year report.

Manager's Report

Performance

The net asset value total return for the six months was 14.8%, ahead of the benchmark total return at 9.8%. Continental property companies collectively returned 11.3% (in local currency terms) again outperforming their UK counterparts (2.1%). When viewed entirely in GBP, the difference is even starker given the weakness in GBP over the period.

The initial impact of the pandemic on European real estate equities saw the benchmark drop 36% from the pre-COVID peak of 19 February 2020 to the most recent trough on 18 March. The new financial year therefore started close to these depressed levels. Whilst the performance in the first half when viewed in isolation is encouraging, it is important to note that the sector remains over 19% below the pre-COVID-19 peak.

Reviewing the attribution, it was another period in which our overweight to logistics/industrial and the underweight to retail delivered relative outperformance. London exposed stocks suffered particularly as office workers have not returned (we estimate office utilisation rates at c25% versus a Continental average of +50%) and this combined with the collapse in tourism (both domestic and international) has hollowed out our global city. Our UK office exposure was concentrated in decentralised offices through CLS and McKay whilst we avoided retail focused names such as Capco and Shaftesbury as well as those businesses with short occupational leases such as Workspace.

German residential continues to be a dominant element of both our universe (accounting for 25% of our benchmark) and the portfolio (30% of net assets). Investors remain drawn towards the very high levels of occupancy (c99%), secure income (virtually no arrears) and fundamental market dynamics. Germany, like all developed countries needs to build more housing. This demand for secure income was a dominant theme in the period with healthcare (Assura, PHP and Target Healthcare) all contributing to performance alongside our supermarket exposure (Supermarket Income REIT in the UK and Cibus in Finland/Sweden). Aside from Cibus, my collective underweight to Sweden generally and in particular the residential names (we prefer Germany) was costly. The Swedish property names, which account for 12% of our investible universe, collectively enjoyed a total return of 30% (in SEK) over the 6 months with almost all of that gain in one month - September. Investors really bought into the success of their economy reopening with a different approach to management of the health crisis than the rest of Europe.

The pandemic has turned much 'on its head' and in our corner of the equity market it was the performance of Swiss property companies which have been much weaker than history would have predicted. Traditionally a safe haven, these stocks have not recovered from the March lows with investors focused on the problematic retail exposure of the largest listed companies. We continue to be underweight in the group. Another surprise has been in self-storage which has reported only very modest contraction in demand. Whilst our stock selection in the UK was correct (Safestore total return +23% versus Big Yellow +5%), the runaway success was Shurguard, the Continental player which returned +42%, which we didn't own. In our defence, the stock enjoyed strong demand from index trackers as it entered various benchmarks.

The portfolio has some gearing. This was reduced in February and March but has subsequently returned to prior levels. In a period of elevated volatility this requires further explanation. The Trust continues to take advantage of its closed ended structure and holds a number of illiquid small cap stocks. These well-run companies exposed to outperforming subsectors often suffer from investor oversight being deemed too small. As a consequence, in rising markets they often underperform their larger brethren (in market parlance their 'beta' is less than 1). Adding some gearing helps compensate for these lower beta names. Our experience is that over time the underlying property fundamentals would be recognised and if not, then the market would take them private or merge them together. Our physical property exposure also sits outside our benchmark and additional gearing ensures that we are not underexposed to equities versus our  benchmark given that a proportion of capital is invested in physical property.

Offices

This sector has suffered from universal negative sentiment as much of Europe's office-based workforce switched to working from home ("WFH"). This all occurred in late March and into April, just as we entered our new financial year. As spring turned to summer we saw a steady increase in returning to working in the office. This was far more pronounced in Continental cities, particularly smaller ones than in London (which holds the unfortunate accolade of the longest average commute of 77 minutes). Evidence from Scandinavian cities (including the largest, Stockholm) indicate office utilisation rates (the levels of occupancy compared with pre-COVID levels) reaching +80%. The major German cities have also reported much higher levels than London and again reflects the size of the city, commute times and the amount of decentralised office space (fewer floors than the CBD towers).

The low level of utilisation in London has clearly impacted existing and potential tenants' behaviour. The silver lining on the proverbial cloud has been the lack of new supply (as commented upon in the Annual Report) which remains well below the long term average. However, as expected, demand has reduced whilst supply, particularly of second hand space, has risen every month since March and is now at 18.1m sq ft (long term average 14m sq ft) a level last seen in 2010. Vacancy overall has now crept up to 6% across Central London but is much more pronounced in the City and Docklands than in the West End.

None of this market behaviour comes as a surprise and has been fully reflected (in our view) in share prices. The surprise has been the robustness of the property investment market and this has been echoed across Europe's dominant cities. Long term capital has looked beyond the current crisis and clearly doesn't buy into the 'end of the office' theory (nor do we). The last quarter of the year has already seen a number of significant transactions with competitive bidding and the major agencies are predicting prime yields to remain stable (initial yields at 3.75% for the West End, 4% for the City) as we progress into 2021. It is important to note that such demand is focused on prime, fit for purpose, buildings.

Paris has seen a similar investment picture with the headline grabbing sale by Unibail-Rodamco-Westfield of SHiFT, a 47,000 sq m brand new office for €620m. However, Paris is experiencing increasing new supply particularly in La Defense and other decentralised markets. Only the core central areas have maintained record low vacancy levels and we remain nervous about the prospects outside of this central sub-market.

As we move into the autumn we are experiencing a second wave of the virus in Europe and the nascent return to office movement appears at risk of being snuffed out. A pattern of tenants extending existing leasing arrangements whilst they assess their future requirements is emerging. WFH will therefore remain a key element of working patterns now and in the future, however the longer it continues to be the default option the greater the realisation that it is no panacea.

Retail

The MSCI/IPD data for six months to the end of September saw all retail property capital values fall -9.1% with shopping centres down -14.5%. We feel that the data is historic and the valuation community collectively have further write downs to make at the calendar year end and beyond. The pandemic has accelerated structural issues which were already well underway prior to February 2020. In fact, I have been commenting on the challenges of our fast-changing spending patterns on physical retail space for many years. The 'double whammy' in the UK is the collapse in the profitability of many physical stores coupled with the use of the CVA process to force landlords to accept reduced rents. Landsec's new CEO, Mark Allen commented at his inaugural Capital Markets Day that he expected rental values to fall a further 25% from their March position.

A consequence of this acceleration in the decline of all metrics (for this sector) has been the utter dearth of transactions. Investors are not yet ready to step in until there is clarity on affordability for tenants.

It is this issue of affordability which separates the (dire) situation of the UK with the (poor) situation in Continental Europe. Historically, short lease lengths and indexation enabled Continental European retailers to adjust rents to market levels much more easily than their UK counterparts. However, there is no room for complacency, the low levels of online retailing in France and Italy (when compared to the UK) is set to change forever with a huge increase in new adopters. Inditex, Europe's largest fashion retailer has announced its objective of having online sales reaching 25% of all turnover by 2022 when compared to 14% in 2019. An extraordinary acceleration in a very short period of time.

Investment markets remain very subdued. The UK saw virtually no material shopping centre transactions in the period. All listed retail landlords have identified the need to reduce their leverage. In the UK, the administrator of Intu is reportedly marketing the Trafford Centre and Hammerson will need to sell assets to support its refinancing. In France, Unibail-Rodamco-Westfield has announced its intention to raise €4bn from selling both Paris office schemes and number of large shopping centres. It successfully sold a majority stake in 5 centres to Credit Agricole/La Francaise for €1.1bn but this still required substantial vendor financing. New clearing prices for both large and small centres will now be set in the next 12 months as vendors become price takers.

Distribution and Industrial

In the Annual Report I commented on how the supply response, particularly for UK 'big box' logistics assets, had reduced the rate of rental growth in the previous year. However, the last six months has seen demand for these assets (and for their smaller 'last mile' cousins) accelerate. DTRE report record take up in the UK of 32.6m sq ft for the first 3 quarters of 2020, ahead of the previous record set in 2018. Q3 2020 saw the highest ever quarterly figure. Supply of modern units (100,000ft and larger) is just 33m sq ft again close to record lows. Yet another example of where the crisis has accelerated an existing structural trend. We anticipate further investor demand and potentially yield compression from here.

For broader industrial markets we are seeing the steady maintenance of demand. Looking at previous cycles we would have expected demand to weaken as economies slowed but the structural undersupply particularly in the more valuable suburban environments - where land supply is negligible - is underpinning rents. Again the crisis has revealed the attraction of this asset class with tenants able to continue to occupy and operate their businesses in a COVID-safe manner. Something which is proving much harder to achieve in an office building.

In Continental Europe the previously slower adoption of online retailing is rapidly accelerating. The Centre for Retail Research's (CRR) July 2020 forecast for Western Europe's six largest economies online sales to rise from 12% in 2019 to 16% in 2020. Pre-COVID estimates were for 16% to be reached only in 2022 so the crisis has steepened the trajectory. The UK's experience was that once online sales exceed 12% they gain a momentum which results in a marked increase in logistics demand. Another impact has been the increase in businesses confirming that they are investigating or are already underway with re-shore or near-shore projects. The tag line is 'a little more just in case rather than more just in time'. These structural shifts are evident in the low level of vacancy even through the pandemic. Savills report average vacancy levels rising from 5.1% to just 5.8% in the first half of 2020 across Continental Europe.

Again, investors are following the growth. Logistics investment transaction volumes total €13.3bn in the first half of 2020, less than the €14.5bn in the same period of 2019 but not far behind and quite extraordinary given the lockdown restrictions. Germany was the most active market exceeding €3bn, beating the UK (€2.8bn) and France (€2.1bn). Demand remains very resilient.

Residential

As expected the sector has remained highly resilient during the pandemic. The majority of our investments are in German and Swedish housing where rents are subject to state control. The remaining exposure is Finland and the UK where rents are open-market. The former offer greater security with rents tied to indexation whilst the latter offers more opportunity to capture market growth but with the commensurate risk if vacancy rises and market rents fall. During the crisis, the security of income and very high occupancy levels resulted in the sector retaining its popularity. German housing has experienced price rises in virtually all its sub-markets. Berlin remains the outlier. The rent freeze (Mietendeckel) became law but an appeal is due to be heard by the Federal Constitutional Court in Q1 2021 and most experts expect the law to be nullified on the grounds that such decisions are under Federal not State jurisdiction. One predicted side effect of the rent freeze has already begun to materialise, namely the rapid reduction in new build starts. The fundamentals across Germany are no different to other Western European economies, a shortage of supply. Germany requires 350,000 new units per annum and is currently building less than 250,000. We expect to maintain our overweight position.

Alternatives

This group encompasses sectors who have thrived (supermarkets, healthcare, self-storage) in the crisis and those who have not (student accommodation, hotels). Healthcare encompasses primary healthcare, elderly living and social housing. The best performance has come from those businesses with the most secure (state funded - directly or indirectly) income. This has seen primary care outperform elderly living. However, the underlying funding of elder care across the UK and Continental Europe varies enormously between private and public and this has impacted on investors perceptions of the quality of earnings. Aedifica, Europe's largest listed owner of nursing home facilities returned 13.4% in the six months whilst Target Healthcare, a much smaller, UK provider returned 1.2%. We now favour the latter stock on valuation grounds.

Self-storage has been very resilient through the crisis. Our central thesis is the combination of WFH (people need to declutter the spare room) and the flexibility offered to commercial tenants combined with the city centre locations of much of the listed companies' sites has resulted in demand being resilient.

Our supermarket exposure has been through Supermarket Income REIT (UK) and Cibus (Sweden and Finland). The strong earnings quality from these companies and index-linked income growth combined with dividend yields over 5% remains attractive. Supermarket's latest raise (£200m in October) was upsized given the demand and is the second raise this year (following £140m in April). Alongside industrial and logistics, supermarkets have seen elevated transaction volumes.

Student accommodation revenues have clearly suffered through the crisis, however this sector has solid long term fundamentals. Three factors support our views, rising domestic student numbers (the Millennium 18 year old demographic dip is now behind us) and a desire to increase one of the UK's major exports (tertiary education) will drive growth. In addition, economic downturns (and a fall in school leaver job opportunities) lead to more young adults remaining in education. In the short term, the operational risks are clear but if we are looking for sectors which can rebound faster than underlying economic growth, this is one of them.

Debt and Equity Markets

Debt raisings and refinancings were down on the same period last year, but not by as much as we might have expected given the pan European lockdowns. EPRA recorded €10.3bn for the six months compared to €12.6bn in the same period last year. As noted last year, very low rates have been with us for so long now and durations have mostly been extended resulting in fewer refinancing requirements. German residential companies were prevalent in the period with Vonovia raising €2.5bn in four transactions borrowing 10-year money at 1%. In late October, Gecina, Europe's largest office REIT raised €200m in a 2034 term bond at 0.86%. For the strongest real estate companies bond markets remain very attractive particularly given the ECB's ongoing buying programme.

There were no IPOs in the period, which is not a surprise. However, particularly early in the crisis, we did see a number of strong businesses trading at premiums raise capital for opportunistic expansion. This was in sectors with clear underlying demand, namely healthcare (Assura, Aedifica, Primary Health Properties), self-storage (Big Yellow), logistics/industrial (LondonMetric, SEGRO, VGP), supermarkets (Supermarket Income REIT) and German residential (Vonovia, ADO Properties). The total raised was £3.6bn.

Post the summer we have begun to see the more defensive raises as companies come under cashflow and valuation pressure. This has been primarily in the retail sector with raises at varying depths of discount to the respective undisturbed price depending on the level of distress. Hammerson's £600m raise effectively recapitalised 95% of the pre-raise balance sheet with a 24 for 1 rights issue. Unibail-Rodamco-Westfield announced a proposed €9bn 'Reset' plan comprising €3.5bn capital raise, dividend cancellation and a planned €4bn of disposals. Post the period end, Shaftesbury announced a £300m placing and open offer at 400p, a 20% discount to the undisturbed price and a 54% discount to their last published net asset value. The Company needs to raise capital to enable its lenders to grant waivers as otherwise it would breach a number of interest cover ratio requirements. For owners of retail property this is both a cashflow and valuation crisis.

Property Shares

After the initial recovery in late March and early April, pan European property shares were tightly range bound through the Spring. They enjoyed a further step up in recovery in late May as European economies began to reopen but then continued their range bound (6% peak to trough) performance to the end of the period. To illustrate the point, the index value on 15th June  and 30th September  were virtually identical.

However, underneath this blended performance we have experienced some of the greatest divergence in sub-sector returns since the global financial crisis. The period witnessed the dramatic acceleration of already evident structural change in the retail / logistics trade off. However, the pandemic also started a worldwide rethink on how we might use office space in the future. Alongside these questions over the built environment, investors also saw the opportunity to buy high quality, index-linked income streams (healthcare, private residential and supermarkets) just as fixed income yields became even skinnier than before. The hunt for yield has become even harder.

A sample of performance figures amply make the point. In the UK, SEGRO's total return in the period was +25% as it was for our preferred self-storage operator, Safestore. The standout logistics performance was Tritax Bigbox at +46%, whilst Hammerson was the same figure but with a minus sign in front. Intu's negative performance was -100% as the company moved into administration and delisted with the equity evaporated. Capital & Regional's total return was -55% even with a new cornerstone investor (the South African listed company, Growthpoint). The picture was the same across Europe, WDP (Europe's largest logistics owner / developer) +22% and Argan (our favourite small cap logistics owner / developer ) +23%, whilst Unibail-Rodamco-Westfield and Klepierre recorded total returns of -39% and -27% respectively.

Investment Activity

Turnover (purchases and sales divided by two) totalled £325m equating to 25% of the average net assets over the period. This was more than double the £157.8m for the same period last year. The increase reflects a number of factors, the most significant being the reinvestment in the portfolio which occurred in April and May as share prices recovered from their March lows coupled with the participation in a large number of offensive capital raises as described earlier.

As we move into the second half of the financial year, the number of defensive capital raisings are beginning to mount. The general meeting ("GM") for the Unibail-Rodamco-Westfield's 'Reset' proposal was held on 10th November and the vocal minority opposing the deeply discounted capital raise successfully blocked the raise as well as voting in 3 activists onto the Board, led by the ex-CEO, Leon Bressler. Shaftesbury's GM will be less contentious with the two cornerstone investors (Norges and Capco) owning 50% of the equity between them. However, raising equity at over 50% discount to the last published NAV is a bitter pill for shareholders. We have participated in the raise.

The high levels of share price volatility within the tight overall trading range coupled with the outperformance of certain sectors and the continuing deterioration of others resulted in relatively little overall portfolio repositioning. However, there was a handful of significant changes within both our overweight and underweight sectors. Within German residential, I reduced exposure to Deutsche Wohnen whilst increasing the Berlin small cap Phoenix Spree but overall exposure to Berlin residential changed little. Our exposure to broader German residential did increase with additional investment in Vonovia, LEG and TAG. Our London office exposure fell with the sale of the entire Workspace position as we rotated away from companies with short term income weakness whilst increasing our holding in Derwent London. In Sweden, we reduced exposure to Stockholm offices (Fabege and Kungsleden) whilst increasing exposure to Swedish/Finnish supermarkets through Cibus. Within the logistics space we took substantial profits in LondonMetric, recycling into Argan in France, Montea and VGP in Belgium and VIB Vermoegen in Germany. The sales in LondonMetric were valuation based and we continue to have a significant holding and full confidence in management. Although London office exposure fell, we added to German cities through Aroundtown and CLS Holdings.

Revenue and Revenue Outlook

Revenue collected in the first half of the year amounted to around 77% of the prior year level. At the beginning of the financial period, a number of companies announced the suspension of dividends or cuts in response to the COVID pandemic. Some of these were at least partially restored later in the year and our portfolio was well positioned towards the sectors which have maintained dividend levels, however companies remain cautious and we expect to see a continued lower level of income in the second half.

Income from our direct portfolio has remained relatively robust and at the time of writing, we have collected 88% of the total rent roll with agreed deferrals of  4%. Of the remaining 8% we are chasing 5% with 3% having been written off to help support two of our four retail tenants at the Colonnades.

Our income from the equity portfolio is not received evenly throughout the year and the first half usually represents around two thirds of the full year income. Non-sterling income will also be subject to exchange rate fluctuations, with more volatility likely as the Brexit deadline approaches and negotiations continue.

The effective tax rate has reduced from a prior year level of 10.5% at the half year stage to 8.4%, largely due to favourable withholding tax rates on dividends received in the first half.

The longer-term outlook is difficult to predict, the uncertainty around COVID-19 continues and at the time of writing many European countries and the UK are in a second phase of lockdowns. This will continue to put pressure on rent collection from a number of users of real estate, although, as already set out in this report some sectors have benefited or at least remained robust. Currently the portfolio is well positioned towards these users, but as flagged in the Chairman's report, valuation considerations may cause this to change.

In the meantime, the Board has announced an interim dividend in line with the prior year and an intention to utilise reserves for a period of time until a longer-term view emerges.

Gearing and Debt

Gearing at 16.8% has increased substantially from the 7.6% at the year end and I touched on the background to this earlier in this announcement. Three quarters of the debt drawn at the half year stage was derived from flexible short term borrowing or gearing through the use of CFDs giving a high degree of flexibility to adjust if market conditions change.

We continue to source our debt from a variety of sources and at the time of writing have just agreed a renewal and increase in our facility from ICBC. Other facilities renew at different points in the year and as they do we will consider the amounts and maturity dates. It is our aim to maintain a variety of sources and maturity dates.

Direct Physical Portfolio

The physical property portfolio produced a total return of -1.2% composed of a capital return of -2.9% and an income return of 1.7%. In contrast the IPD Monthly Index produced a total return of -1.6% made up of a capital return of -4.3% and an income return of 2.8%.

The September valuation fall was driven by deteriorating sentiment towards all retail property. Whilst our non-food retail exposure is restricted to just four units at the Colonnades in Bayswater, the valuers' estimated rental values were marked-down and investment yields rose resulting in a £3m write down in the £100m portfolio.

The industrial component of the portfolio performed well over the six months with industrial occupational demand and investment activity remaining robust. At our industrial estate in Wandsworth, we successfully let 4 units during the lockdown to a variety of tenants. All leases are now deliberately short term to preserve the redevelopment flexibility following the successful receipt in November 2019 of planning permission to redevelop the estate.

Outlook

In the Annual Report I emphasised our focus on businesses whose cashflow had suffered minimal disruption through the crisis. The huge amount of central bank stimulus and government fiscal support has ensured that for the vast majority of property companies, this remains a liquidity rather than solvency crisis.

In the last few days, news of potential vaccines has driven markets higher even as we all endure a second phase of lockdown. In the short term, improvements in all aspects of the testing regime will increase mobility, with the vaccines hopefully reaching much of the population through 2021.

Even at that point, all nations will still need to grapple with the huge additional debt burden and we believe real assets will remain a key cornerstone for institutional investors as we look to an elongated period of very low interest rates.

As I have highlighted in previous reports, much more real estate is owned privately than via public markets. If listed companies continue to trade at significant discounts to asset value then we would expect to see more 'public to private', particularly given the amount of capital searching for returns.

Marcus Phayre-Mudge

Fund Manager

26 November 2020

Distribution of Investments

as at 30 September 2020

Distribution of Investments

as at:

Investment Exposure

as at 30 September 2020

Investment Exposure

as at:

Portfolio Summary

as at:

Net Currency Exposures

as at 30 September 2020

GROUP STATEMENT OF COMPREHENSIVE INCOME

for the half year ended 30 September 2020

The total column of this statement represents the Group's Statement of Comprehensive Income, prepared in accordance with IFRS. The revenue return and capital return columns are supplementary to this and are prepared under guidance published by the Association of Investment Companies. All items in the above statement derive from continuing operations.

The Group does not have any other income or expense that is not included in the above statement therefore "Total comprehensive income" is also the profit for the period.

All income is attributable to the shareholders of the parent company.

The final Ordinary dividend of 8.80p (2019: 8.60p) in respect of the year ended 31 March 2020 was declared on 29 May 2020 (2019: 30 May 2019) and was paid on 4 August 2020 (2019: 30 July 2019). This can be found in the Group Statement of Changes in Equity for the half year ending 30 September 2020.

The interim Ordinary dividend of 5.20p (2020: 5.20p) in respect of the year ended 31 March 2021 was declared on 27 November 2020 (2020: 28 November 2019) and will be paid on 8 January 2021 (2020: 7 January 2020).

GROUP AND COMPANY STATEMENT OF CHANGES IN EQUITY

GROUP BALANCE SHEET

as at 30 September 2020

GROUP CASH FLOW STATEMENT

For the half year ended 30 September 2020