… and Braemar Estates only manages 14% of the Ground Rents Income Fund plc
It owns some freeholds with doubling ground rents and has offered to transfer them to RPI.
LKP noted that James Agar, employed by Brooks Macdonald Funds (BMF) which manages GRIF plc, is a director of Braemar Estates, and that Martin Robinson, chairman of Braemar Estates is a director of GRIF Cosec Limited, which appears to own the freeholds of the fund.
Mr Agar has repeatedly stated that the Ground Rents Income Fund plc is “committed to being a socially-responsible landlord, working hard to treat all leaseholders in a simple, honest and transparent manner”.
It provided the following statement to LKP on September 25:
Ground Rents Income Fund plc (GRIF) is a closed ended real estate investment trust (REIT) incorporated in England and Wales in April 2012. The Company was admitted to the Official List of the CISX and to trading on the SETSqx platform of the London Stock Exchange (LSE) in August 2012. As a publicly listed company GRIF meets all necessary regulatory shareholder disclosure requirements.
GRIF has appointed Brooks Macdonald Funds (BMF), a subsidiary of Brooks Macdonald Group, as Investment Manager, an activity which is governed by the EU’s Alternative Investment Fund Managers Directive (AIFMD) and regulated by the Financial Conduct Authority (FCA).
BMF delegates its responsibility for the collection of ground rent from the GRIF portfolio to Braemar Estates (Residential) Ltd (Braemar), a sister company in the Brooks Macdonald Group.
Braemar is separately appointed by GRIF to manage approximately 14% of the leasehold properties within the GRIF portfolio. The remainder of the portfolio is managed by other, unrelated, managing agents.
GRIF, as the owner of residential freeholds, and Braemar, as property manager of the above mentioned minority of the GRIF portfolio, are not related companies and they are not under common ownership.
Furthermore, Brooks Macdonald Group recently announced (21 September 2017) the sale of Braemar to Rendall & Rittner Limited, with the sale due to complete by calendar year end.
GRIF Cosec Ltd is a wholly owned subsidiary of GRIF and does not own any freeholds itself, but provides secretarial services to the company.
As a point of clarification, Mr Agar is not the CEO of GRIF but is employed by BMF.
A copy of the RNS announcement outlining the action GRIF proposes to take in relation to doubling ground rents it owns is attached, as well as Brooks Macdonald Group’s announcement regarding the sale of Braemar.