Ground Rents Income Fund plc - GRIOInvests in long-dated ground rents aimed at sustainable long-term performance
Why invest in GRIO?
GRIO's strategy is to invest in a diversified portfolio of residential and commercial freeholds and head leases offering the potential for income generation from ground rents that are hedged against inflation and for capital growth from active asset management.
The residential ground rents sector is currently subject to uncertainty relating to leasehold and building safety reform. The Investment Manager’s current strategy is focused on mitigating the risks and consequences associated with this.
In other parts of the real estate market there is strong demand for investments offering similar, annuity-style cash flows and we expect this demand to continue.
The Company’s portfolio benefits from the following characteristics:
- Highly-diversified, long-term portfolio of approximately 19,000 units across 400 assets with a low default risk.
- Predictable revenue with upward-only rental increases, of which 71% of the ground rent income is indexed-linked, predominantly to the Retail Price Index (“RPI”).
- Long-term income with weighted average lease duration of 375 years.
- 46% of the portfolio ground rent income is due to be reviewed over the next five years.
Meet the manager
""We aim to deliver sustainable, long-term performance by investing in long-dated ground rents."
Independent Board of Directors
Performance and charges
For further performance data please view the latest factsheet or visit the London Stock Exchange website
Ongoing charge: 2.4%
Discrete yearly performance (%)
Discrete Yearly Performance (%)
Q1 2021 Q1 2022
Q1 2020 Q1 2021
Q1 2019 Q1 2020
Q1 2018 Q1 2019
Q1 2017 Q1 2018
Share Price (1)
Shareholder Total Return (2)
NAV Total Return(3)
Issued in June 2022.
Past performance is not a guide to future performance and may not be repeated. The value of investments and the
income from them can go down as well as up and you may not get back the amount originally invested.
1 Source: Schroders, Datastream, bid to bid price with net income reinvested in GBP.
2 Source: Schroders Capital, Datastream, bid to bid price
3 Source: Schroders Capital, NAV to NAV (per share) plus dividends paid
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Investing in Ground Rents Income Fund plc
What are the risks?
The Company may be concentrated in a limited number of geographical regions, industry sectors, markets and/or individual positions. This may result in large changes in the value of the fund, both up and down, which may adversely impact the performance of the fund.
The Company may borrow money to invest in further investments, this is known as gearing. Gearing will increase returns if the value of the assets purchased increases in value by more than the cost of borrowing, or reduces the returns if they fail to do so.
As a result of fees being charged to capital, the distributable income of the fund may be higher but there is the potential that performance or capital value may be eroded.
The Government has been considering reforms to the residential leasehold system and building safety regime since 2017. This has created uncertainty and impacted the Company’s valuation. The final outcome of future legislation remains unclear and could negatively impact the Company’s portfolio further. The Board of the Company and Schroders as Investment Manager are working to protect shareholders’ interests and further details are contained in interim results to 31 March 2022.
Non-Mainstream Pooled Investments (NMPI) Status
The Company currently conducts its affairs so that its shares can be recommended by IFAs to ordinary retail investors in accordance with the FCA's rules in relation to non-mainstream investment products and intends to continue to do so for the foreseeable future. The Company's shares are excluded from the FCA's restrictions which apply to non-mainstream investment products because they are shares in an investment trust.