Nemesis consistently ranks as one of the most exciting rollercoasters in the world – a highlight for anyone who enjoys hanging upside-down while hurtling through the air at 50 mph.
Recently upgraded, Nemesis is a top attraction at Alton Towers, helping the theme park to attract more than two million visitors a year, about 7,000 a day in summer.
Alton Towers, in Staffordshire, is the biggest theme park in Britain and its partner in thrills, Surrey’s Thorpe Park, comes a close second.
Highlight: Shares in Alton Towers theme park’s landlord LondonMetric are expected to rise
Their landlord is LondonMetric, a property company which has delivered nine consecutive years of dividend growth and looks set to make that a decade by the end of this year.
LondonMetric shares are £2.01 and should increase in price, as chief executive Andrew Jones is highly experienced, the business is deliberately focused on fast-growing sectors of the economy and it is in rude financial health.
Fresh from a board position at industry giant British Land, Jones founded Metric Property Investments in 2010.
He merged the business with a rival firm three years later and LondonMetric was born. There have been several deals since, most recently an all-share merger with LXi, another UK property group firmly focused on delivering income to shareholders.
Today, the enlarged business owns 580 properties across the UK, from Inverness in Scotland to Truro in deepest Cornwall.
While Alton Towers and Thorpe Park are big tenants, warehouses and other logistical hubs account for more than 40 per cent of the portfolio by value.
Primark’s flagship distribution centre was developed by LondonMetric, spanning almost 2 million square feet over four storeys and earning annual rent of more than £5 million.
Other key tenants include Amazon, Royal Mail and DPD, while many smaller businesses rent distribution space too, ranging from microbreweries to coffee roasters to DIY merchants.
Away from logistics, private hospitals and budget hotels form a large part of the rent roll, along with edge-of-town supermarkets and discount stores, from Waitrose and M&S to Aldi and B&M.
The merger with LXi was a smart move, catapulting LondonMetric into the FTSE 100 index and making it more attractive to big institutional investors and better able to secure low-cost finance. However, the group should appeal to individual shareholders too.
Many property firms do not just rent out sites, they also take responsibility for managing them, ensuring lifts are working, lights are replaced, car parks are clean and such like.
Jones takes a different approach, known in property circles as triple net. He provides land and buildings but leaves tenants to manage them. That allows him to keep costs low so he can pay out plenty of cash in dividends – and he does.
There was a 7 per cent increase in the dividend to 10.2 p for the 12 months to March 2024 and analysts expect a 12p payout for the current year, putting LondonMetric on a yield of 6.25 per cent.
The group pays dividends quarterly too, so investors receive a nice little fillip every three months.
Generous dividends are backed by strong growth across the business. Rental income rose 20 per cent to £177million last year, with occupancy levels at more than 99 per cent and only a handful of smaller tenants needing extra time to pay.
Rents are set to hit almost £400million this year, following the LXi merger. The deal will deliver material cost-savings too, enhancing income growth.
LondonMetric has become a trusted landlord over the years and 20-year leases are common so businesses stick with the company for the long-term.
Rents are reviewed on a regular basis and 80 per cent involve a contractual uplift so they increase either annually or every five years, providing a solid basis for dividend growth.
MIDAS VERDICT: Property firms have had a rough time but the cycle seems to be turning and LondonMetric is well positioned to benefit.
Leases are long, tenants operate in fast-growing sectors and many are blue-chip names. At £1.91, the shares are a buy and generous dividends add to their appeal.
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