Tritax Eurobox (EBOX ) has seen its value slide by a quarter but the majority of losses were suffered in the early part of the year, with property prices now showing signs of ‘stabilisation’.

In annual results to the end of 30 September, the £453m investor in European warehouses, reported a 26% slide in EPRA net tangible assets from €1.38 per share to €1.02 over the year.

However, the vast majority of the decline was felt in the first half of the year as property suffered the fallout from the Liz Truss mini-Budget and aggressively increasing interest rates.

In the six months since 31 March, the fund reported a more modest decline of 2% as valuation yields showed signs of stabilising.

Trust manager Phil Redding said the portfolio had felt the effects of ‘sharply higher interest rates’ that had pushed up yields, lowered assets values, and subdued transaction volumes.

‘However, strong underlying structural drivers, supportive market fundamentals, and rebased asset pricing are attracting investors back to the sector, with investment activity and asset values showing signs of stabilisation,’ he said.

Redding noted that in contrast to previous property cycles, ‘occupational market fundamentals have remained robust, with most markets characterised by low levels of available modern warehouse space’.

Leasing successes and indexation of rents helped drive like-for-like rental growth of 4.5% over the year, which combined with the cost savings from last year’s management fee reduction to deliver earnings per share of 5.51c per share, meaning the dividend of 5c per share was fully covered.

Redding said the focus over the past 12 months has been ‘on driving improvements in operational performance’ to capture income growth opportunities in the existing properties, including asset management, development and leasing activities.

This helped the trust secure €3.6m of new rental income a year, which has also increased valuations.

‘The built-in uplifts from the index-linked and fixed uplift structures of our leases produced €2.3m of new rental income, and represented a significant driver of growth in annualised rental income, which increased to €76.3m,’ he said.

The portfolio comprises 23 warehouses plus one under construction and one plot of land, with assets spread across Belgium, Germany, Italy, Netherlands, Poland, Spain, and Sweden.

Redding said the exposure to development and ‘value-add activities’ is managed ‘dynamically to be aligned with investment and occupational market conditions’.

‘With the external environment becoming more challenging over the past 12 months, we have sought to reduce portfolio exposure to speculative development risk and to focus on capturing income growth and value from the existing stabilised portfolio,’ he said.

Numis investment companies analyst Andrew Rees said the pick up in performance since March had been in contrast to EBOX’s nearest peer Abrdn European Logistics Income (ASLI ), which has seen a further 11% fall in assets since the end of March.

He said while falling valuations had increased the fund’s loan-to-value, ‘further successful disposals should result in this coming back down within management’s 40% target’.

‘A reduction in the level of debt will also benefit improve the fund’s credit rating, which will prove important as management contemplates refinancing the €500m green bond over the next couple of years,’ said Rees.

He added that its discounted is ‘notably wider’ than ASLI’s after its shares rallied last week on the announcement of a strategic review.

EBOX’s shares are trading at a 37% discount to the September NAV, while ASLI is trading on a 26% discount.