Urban Logistics (SHED ) has appointed former M&G fund manager Justin Upton to work alongside chief executive Richard Moffitt as the last-mile investor announces further income growth with 15 new lettings.

Upton, who stepped down from M&G Property Portfolio  at the end of last year after taking over control of the £2.2bn fund halfway through its 17-month gating period in mid-2021, has become chief investment officer of Urban Logistics.

Moffitt said Upton had been brought on board to support growth in the £661m real estate investment trust (Reit), and said his ‘experience and expertise will be invaluable as we look to recycle capital and create value for shareholders’.

A trading update for the first three months of the year showed the Reit secured 15 new lettings and ‘regears’, or renegotiated leases, that added £1.6m of additional income. This reflected an average 24% uplift in rent for the new lettings and 5% for the regears. 

The trust has also secured four deals following the end of the period, adding another £800,000 in rent, including two new developments in Nottingham and Rochdale which have been let on yields of 7.7%. The developments also increase the proportion of the portfolio with an A or B energy efficiency rating to 52%, up from 27% a year ago.

Moffitt said ‘active asset management strategy is key to delivering value throughout the property cycle and this quarter has been no different, with the completion of some significant new lettings to tenants who deliver essential goods across the UK and are therefore less vulnerable to fluctuations in economic conditions’.

Numis analyst Gavin Trodd said the trading update showed occupational dynamics in industrial property remained ‘healthy and continue to underpin attractive rental growth’ after the derating that hit the highly-valued industrial sector last year.

‘Although overall space take-up in recent quarters has cooled compared to 2020 and 2021, it remains well above the long-run averages,’ he said.

He said smaller sheds, which Moffitt invests in, are also commanding a ‘greater share of overall take-up than larger “mega-sheds”’.

Urban Logistics currently yields 4.6% and yesterday’s closing price of 140p stood on a 10% discount below Numis’ estimated net asset value per share of 155.4p. Including dividends, the shares have fallen 13% over one year but delivered a 45% total return over five years.

The company will report its annual results for the year to 31 March on 22 June.