Assura Limited (AGR) Earnings Call Transcript & Summary

[Presentation] Thank you, Lisa and Luke, for sharing some of your reflections on the past year. You can certainly see that it has been difficult for both of them. Welcome to you all. The past year has been like no other. And today, as we present our results, we would like to take you into some of the unique circumstances we have found ourselves in and try to convey how we have continuously had to adapt in order to meet the challenge of a very busy year, and to support our customers through their constantly changing needs. We will be hearing from a few other key stakeholders during the presentation. So the outline for today is that I will introduce the year and provide you with an update on our social impact strategy, SixBySix. Jayne will then cover the financial and operational performance for the year in detail before I return to look at the market backdrop and the outlook for the year ahead. We opened today's presentation with a perspective from Lisa and Luke. This reflects our approach through the pandemic, which has been to focus on the individual experiences and the well-being of our team. By supporting them, we have been able to sustain a level of customer service and project delivery that I am extremely proud of. Inevitably, we've had some challenges and lost productivity; disruption from adapting to remote working; site visits foregone; delays in construction; the loss benefits of collaborations, which are inevitably harder to undertake remotely. Despite these challenges, the teams have achieved an acceleration in delivery as the year has progressed, with strong performances across all parts of the business. These results are only possible thanks to the contribution of each and every member of the teams. In addition to the strong performance from our existing portfolio, we continue to see further opportunities in many new areas. We have indicated over recent years that the NHS is moving towards a population health-based model that looks at its services holistically and could lead to a significant increased investment in community-based services away from hospital sites. Indeed, throughout this past year, this transition has begun to look inevitable and will provide opportunities for us to act as a property partner right across a range of customers. This could include, amongst others: NHS hospital trusts; community diagnostics providers; NHS Mental Health Trust; primary care at scale operators and private health providers. So turning to the key financial highlights. We had one of our busiest years ever in expanding our portfolio with over GBP 300 million of property additions at an average yield of 4.4% and lease length of almost 19 years. This reflected continued success in acquisitions with GBP 230 million of deals completed as well as a record year in developments, with 12 schemes completed and 16 on site, impressive metrics by any measure and especially so in the last year. This growth in performance has been made possible with the continued support from our investors with GBP 185 million of equity raised in April and GBP 300 million of bonds in September. The bond was our first social bond and attracted new ESG-focused investors. This meant that it was almost 7x oversubscribed and achieved an impressive interest rate of 1.5%, a real testament to the benefits of our social impact strategy. We continue to identify new acquisitions and development opportunities. This was further boosted by the acquisition of Apollo in February, and we entered the new financial year with a strong pipeline. So against this positive backdrop, I am pleased to be able to announce an increase in our quarterly dividend of 4% to 0.74p per share. This time last year, I outlined our new social impact strategy, SixBySix, alongside our ambition to be the U.K.'s leading property business, driving social impact with our purpose, values and culture, aligning us uniquely with the NHS. During my past 8 years at Assura, it has become increasingly clear to me that the key role Assura plays in supporting the NHS compels us to use our influence to further the vital goals of our health system in whatever way we can. This is not about token donations to charity or far-off sustainability commitments, but rather on looking at how every element of our business and the way we operate can maximize our positive impact on society. This will take time, but we aim to embed it into the way we work. We start from an inherently positive place. Our medical centers are essential social infrastructure and play a crucial role in upholding the wealth and health and wellness of our communities. How we deliver these centers is crucial. Is it zero carbon? Do our contractor support local labor and suppliers? Is it based on our design principles with the patient's experience at its heart? And are we supporting the social prescribing space needed. Where we deliver these centers is also crucial as equality of access to health services is as much a part of leveling up our society as access to housing, employment and education. I live in the suburbs of Manchester. It is 7 miles in distance and 7 years in life expectancy from the city center. Deprivation increases the likelihood of having to live with a long-term health condition and of this being more severe. During the past year, we have delivered 2 schemes in areas in the bottom 10% for deprivation and a further 2 in the bottom 20%. And our aim is to make further investments in those areas most in need in future years. And while remote delivery of all sorts of services has become so familiar over the last year, we cannot ignore the fact that 47% of adults over 65, and 24% of people who are disabled don't have a smartphone. There is no question that certain groups are being left behind when it comes to remote health services. I would now like to look at the 2 key themes of our SixBySix strategy: maximizing our impact on society and minimizing our impact on the environment. Turning first to the environment. We have committed to the U.K. Green Building Council's pledge to be net zero carbon by 2030. But to ensure we can achieve this, we have established our own short-term targets as well. Firstly, we aim to be delivering net zero carbon buildings by 2026. This is a huge undertaking. However, by 2022, we aim to be on site at least 2 locations to test how we can begin to deliver this in practice with new ideas such as passive house, modular construction and the increasing use of timber frame structures. New buildings are not the real challenge though. Most carbon emissions are generated by existing buildings. And so the biggest problem is improving our existing estate. We have 600 assets across the U.K., and we have limited data on our operational control over them. However, we have just in the last few weeks completed EPC surveys on all of our buildings and are developing plans to bring them up to an EPC of B within 5 years. This will involve hundreds of improvement projects. But thanks to the relationships we have built up with each surgery, the capability of the team to design and deliver the projects and our capital strength to fund them, we are the ideal company to partner with the NHS to achieve its objectives. This approach to innovation also extends into our design principles in Cinderford in Gloucestershire, we were inspired by our charity partner, Dementia UK, to develop the U.K.'s first dementia-friendly medical center. We are now undertaking research to develop an assessment tool to assist in providing a safe and comfortable space for people with dementia and other cognitive behavioral issues. This will cover such areas as color schemes, materials, signage, that we could then roll out across all of our future schemes. A project we have termed Designing for Everyone. Back in 2019, we launched our concept of a surgery of the future that was built on our study of best practice from primary care right across the globe. Some of these innovations are now being seen such as health pods for patient self-assessment, the redesign of waiting rooms for a less institutional feel and more flexible clinical space. We are now updating these concepts for a post-COVID world by working with a leading primary care group. Our future buildings would then become transformed spaces for a greater range of services with a focus on prevention and nonclinical interventions such as social prescribing. Our second aim is to maximize our contribution to society. And one key element of our plans to achieve this is the Assura Community Fund. On this slide, I have summarized some of the key achievements from our program. But of course, these can't tell the human stories of the staff, the volunteers and tens of thousands of people that these projects have helped. Our fund supported more than 115 health-improving schemes in communities around our buildings across the U.K. These helped young people leaving care and those experiencing homelessness and supported schemes reducing loneliness and isolation. We also helped families with budgeting and cooking skills and supported people who were digitally excluded. These projects will reach 51,000 people, bringing better health outcomes, including increased self-esteem, improved mental and physical health and well-being, reduced stress or anxiety, improved diet and improved social networks. For the current year, we have just opened a further round of grants. As a business based in Warrington in the Rugby League heartland, we have teamed up with the Rugby League World Cup to be their official community health partner. We've used this partnership to engage health projects around community clubs and in the 18 tournament host towns and cities, often in some of the most deprived parts of the country. We have launched a GBP 100,000 funding program to help them reduce isolation, build health confidence and lessen health inequalities. As a sport with community links at its heart, that was a natural fit for Assura, and there has never been a more important time for the power of a major sporting event to bring communities together for better health and well-being. This important activity is the right thing to do as well as aligning us to the values and goals of the NHS. It motivates our team and, as evidenced by the success of our social bond, brings in ESG-focused capital. In short, social impact both delivers gains to our communities and underpins our future commercial success. Before passing over to Jayne, with kind permission from ITV Granada News, this is the story of one of the projects being supported by the Assura Community Fund, with a grant to help set up a community cafe to support mental health. [Presentation]

Good morning, everybody. Thank you for joining us today. And isn't it good to see the community fund in action? That's a lady who can certainly get things done. Well, this is our second year presenting virtually, not something any of us could have foreseen 12 months ago. But this year has brought many challenges for every one of us. However, our resilience and adaptability have enabled us to embrace a considerable amount of change. Here at Assura, we have adapted to working permanently in a remote environment. As people have grown accustomed to this new norm, we have continued to grow our business. We have seen support from our shareholders and our lenders throughout the year. This has enabled us to continue with our acquisition and development-led strategy, which included the acquisition of primary care developer, Apollo. And we look forward to building upon this year's substantial achievement with our social impact goals as we enter our next financial year with a healthy pipeline of new opportunities. And so with this in mind, let me take you through a review of the past 12 months. Last year, we raised GBP 185 million from our shareholders and have proceeded to deploy this capital ahead of expectations. The activity in the year has been considerable. Our development team have completed 12 schemes and moved a further 13 on to site. 31 lease regears, 320 rent reviews and 15 new lettings have been completed by the portfolio team. The investment team have acquired GBP 230 million worth of assets and have disposed of GBP 26 million worth. We launched our social impact strategy alongside the Assura Community Fund, with an initial donation of GBP 2.5 million. And already, over GBP 800,000 has been distributed to good causes. Within this year, we've also acquired a leading primary care developer, Apollo, who bring a successful new team and pipeline into our business, and I will come on to this in a little more detail later. The securing of the above property additions has given us net rental income growth of 8% to GBP 112 million. Our adjusted EPRA earnings increased by GBP 11.6 million to GBP 75.4 million, an increase of 12%. Our adjusted EPRA earnings per share remained flat at 2.8p, reflecting the timing of our equity raise. There was an increase in our dividend from 2.75p to 2.82p per share. The value of our portfolio grew to almost GBP 2.5 billion with a valuation gain of GBP 42 million. We saw further yield compression of 10 basis points, meaning our net initial yield is now 4.58%. And our EPRA net tangible assets per share rose by 6% to 57.2p. In September, we raised our social bond and our loan-to-value is now 37%. We are announcing a dividend increase of 4%, which brings the quarterly dividend to 0.74p per share. We are confident rewarding our shareholders due to the extensive acquisition and development program in the second half of the year, which significantly increased the rent roll as highlighted above. Now let me take you through the rest of our year. Our investment property portfolio consists of 609 properties and has increased by GBP 314 million in the period to GBP 2.5 billion. This reflects our acquisitions, development spend, disposals and portfolio value gain. We have delivered growth in our annualized rent roll of 12% to GBP 122 million. GBP 13.3 million has come from property additions and GBP 1.1 million from asset enhancements, including rent reviews. Disposals have reduced our rent roll by GBP 1.6 million. Our net tangible assets per share increased from 53.9p to 57.2p per share. 2.8p from EPRA earnings has been passed on to shareholders in dividends, 1.9p has come from our equity raise and 1.5p from the valuation gain of GBP 42 million. At the year-end, our net debt stood at GBP 908 million, with a loan-to-value of 37%. Our weighted average interest rate has fallen from 3.03% to 2.47%. In September, we raised our first social bond. This heavily oversubscribed transaction enabled us to raise GBP 300 million at an interest rate of 1.5%, with a commitment to align with the principles laid out within our social finance framework. It is our aim to raise all future debt in line with this social finance framework or to put it on a green or sustainable basis. This reflects our commitment to social impact by maximizing our impact on society and at the same time minimizing our impact upon the environment. Five years ago, the business began its debt restructuring journey, moving from a secured to an unsecured funding structure. This move has enabled us to have complete flexibility over our portfolio, secure our A- rating and raise debt at attractive rates from a variety of sources. Our loan-to-value has moved from in excess of 50% to 37% today. And our weighted average interest rate has more than halved over the same period. In November, we repaid our GBP 110 million secured bond. With this bond repaid, 100% of our assets are now unencumbered. We reduced our revolving credit facility from GBP 300 million to GBP 225 million. Our ability to access other long-term debt markets means we no longer require a facility of this size. We have seen an increase in our debt maturity from 6.8 to 8 years. Our guidance on loan-to-value remains unchanged. We have the ability to increase up to 50%, this is to give us flexibility should opportunities arise. However, we would anticipate remaining in the region of 40%. We are happy to go above 40%, but would expect to bring this down over time. When we raised equity from our supportive shareholders back in April, we had a clear purpose for those funds. The performance I've already highlighted has shown that we deployed the capital ahead of the expectations set. The development program continued at pace with 12 developments for a cost of GBP 69 million completed. We have 16 developments at a cost of GBP 72 million currently on site. Our GBP 67 million acquisition pipeline extended to GBP 230 million worth completed with a further GBP 46 million pipeline at the end of the year. Our asset enhancement program continued to grow with 4 projects completed during the year. And our property additions were secured at a yield on cost of 4.4%, with an average unexpired lease term of almost 19 years. This slide shows all 12 of the developments we completed during the year. Each building is vital to its local community and is designed appropriately to enable the delivery of high-quality health care. We showcased the positive community impact of 2 development completions at our virtual property tour in September: at Netherfield in the East Midlands and Cinderford in the Southwest. The development team have worked during a difficult year to complete these schemes, but the schemes on site are due for delivery during the next 18 months. Some of these projects were delayed due to the impact of the pandemic, but these delays have been kept to a minimum. I just want to pull out a couple of examples of the types of assets we are developing. On the bottom right, we have Bournville, this is one of our most recent completions. It serves a patient list size of 16,000. It has the highest standards of sustainability, obtaining a BREEAM Excellent rating due to including items such as air source heat pumps and a solar PV array. It is also a dementia-friendly design, which meets the requirements to obtain dementia-friendly accreditation. The design of this building had to be amended after the start of the pandemic, to create one-way circular routes throughout, additional external doors and an audio/visual intercom. The building has further future-proofing potential as there is a possibility to add other co-located community health services on site. Next to that, we have launched them. I wanted to highlight this scheme as it is the first of the original GPI schemes that has been delivered. This building serves a patient list size of 18,500 and consists of a full refurbishment of the existing surgery and a large extension. This scheme was partially funded through the NHS' Estates and Technology Transformation Fund. And this is a really good example of us working in partnership to meet the constantly changing needs and demands of the GPs and the NHS. In February of this year, we shared the exciting news that the leading primary care developer, Apollo had joined the Assura team. The acquisition of the Apollo team of 6 development and support staff, along with their pipeline of 8 schemes with a development cost of GBP 50 million, further enhances our development offering. The team bring with them a wealth of experience with additional skills that complement our own. We have 2 schemes that have already advanced and a further on-site scheme at Beaconsfield has switched from a forward fund to an in-house development. In only a matter of weeks, the Apollo staff have settled in well, and now our entire team of 11 development managers ensures we are able to complete our growing pipeline of opportunities. It's been a busy year for our investment team with 50 acquisitions and 29 disposals in the year. The photos show a number of assets we have acquired; ranging from large purpose-built health centers, delivering a range of medical services to its patients, to smaller buildings of no less importance to their community and local health economy. It is good capital discipline to review our assets, something we do each year, and we will occasionally dispose of assets we feel are no longer beneficial for our portfolio. The assets we disposed of this year was slightly above book value, and we continue to review the portfolio on a regular basis and make any disposals we deem appropriate. In managing the portfolio, the property team worked hard to extract the best value from it. We have a range of options at our disposal, and our managers have repeated success in each of these areas. Their focus is upon extending our contracted rent roll and weighted average unexpired lease term by managing our rent review program and focusing on our asset enhancement strategy, whilst incorporating our sustainability goals. Our asset enhancement program takes our assets and improves them by way of either a physical extension or a refurbishment. In return for this investment, we can successfully rentalize any additional space alongside regearing the lease back out to 21 years. As part of any asset enhancement activity, we have now introduced a sustainability element, whereby a portion of the funds must be used to improve the sustainability of the building. This is to bring it in line with our commitment to achieving an EPC of B across the estate. This approach not only brings the building right up to date, but it can also save money in use for the practice. And the valuation uplift creates a good return on our assets. Our average rental growth for the year was 1.5%, split 2% for RPI and fixed, and 1.2% for open market rents. We settled 320 reviews across the estate. You will have heard us talk many times about the linkage to construction cost inflation driving open market rental growth. We do see a lag between the evidence being created from the development flowing through to rental growth. But this is a timing issue, and we are confident in the outlook moving forward. As previously mentioned, our rent collections continue to follow normal patterns with only a few customers requiring a rental holiday or deferred payments. This has remained the case, and we are currently over 98% collected for the March quarter. I've spoken to you before about our commitment to maintain and grow our contracted rental income alongside our weighted average unexpired lease term. We target our whole business on the growth of this income, ensuring we align both our short- and long-term goals and objectives. We have continued to add to our contracted rental income in the year, and this now stands close to GBP 1.6 billion, with 95% of our rent roll still contracted in 2025. With 84% of our rental income coming from the NHS, the longevity of security of our cash flows are evident. Alongside increasing and securing these cash flows, we are also focused upon maintaining our weighted average unexpired lease term. This year, we have successfully managed to not only maintain our WAULT, but to actually increase this from 11.7 to 11.9 years. As you can see, the passage of time would mean our WAULT should have lost 2 years from March '19. However, the work we have done means it is the same as it was 2 years ago. Maintaining this over a portfolio of 609 assets is a considerable achievement. Our team are committed to acquiring and developing high-quality assets alongside our asset enhancement program to extend, renew, re-let or regear our leases, making all of this possible. So to conclude, following a year which has brought such diverse and unexpected challenges, this is a good set of results. The challenges have largely put pressure on our team's day-to-day well-being and routine. In a year of increased activity, it is to their credit and to their remarkable endurance they have kept the momentum going in order to achieve this strong performance. The progress we have made this year provides a firm platform for continued growth into 2022 and beyond. And with that, I'll now hand you back to Jonathan.

Thank you, Jayne. I will now take a more detailed look at the market backdrop and our outlook for the year ahead. The fundamentals of our sector remain robust and have continued to attract new investment. As a result, despite much of the volatility in the wider property sector, we have continued to achieve valuation gains with our net initial yield strengthening by a further 10 basis points to 4.58%. We continue to see opportunities, and we'll retain our selective approach to adding further to our portfolio. Our strong results reflect the successful delivery of the plan we outlined during our equity raise in April, and Jayne has already explained how we have exceeded all of our capital deployment targets. We have also continued to identify opportunities for further growth and have built strong pipelines as we enter the new financial year. In development, we have an immediate pipeline of GBP 111 million, which I will expand on in the next slide. In acquisitions, we have a pipeline of GBP 46 million we expect to complete in the next 6 months. And we are continuing to identify new opportunities. After a record year in asset enhancements, we start the year with a pipeline of 39 lease regears and 6 new tenancies as well as 19 capital projects, which will add GBP 0.9 million to our rent roll. Building from a very strong base, we have further boosted our development capability through the acquisition of Apollo in February. Our total development pipeline now stands at an impressive GBP 405 million, which you can see has been expanded significantly over the past few years. We are on site with 16 projects with a gross development spend of GBP 72 million. We have an immediate pipeline of GBP 111 million and an extended one of GBP 222 million. Looking forward, funding for the NHS and the demands placed on primary care are likely only to increase. Jayne has taken you through this slide before, but we include it to highlight the impact of all of the various strands of activity we have within the business at this time. Once completed, our total rent roll will increase to over GBP 145 million. Our strong development program, both our immediate and extended pipeline, will add around GBP 18 million to our rent roll over several years. Our acquisition pipeline will add GBP 2.5 million in the near term, and approximately GBP 4.5 million will come from our asset enhancement work and rental growth. I want to look now at one of the themes of the year. It is the remarkable adaptability of our GPs who had to embrace entirely new ways of working, beginning with the switch from face-to-face appointments to holding many by telephone or video call. This change has increased the efficiency of some aspects of primary care and, undoubtedly, has led to a permanent shift in the way we interact with our physicians. However, face-to-face consultations will continue to play an important role. The requirement for quality modern space to enable this mixed approach to consultations will only increase, and it will accelerate the need to replace outdated premises that cannot adapt to these new ways of working. The modifications we are seeing because of COVID-19 include wider corridors, larger waiting areas, more flexible consulting rooms, separate entry and exit points and segregated secure zones for treating affected patients. All these changes, we can comfortably integrate in our future schemes and in most of our current buildings. As I referenced earlier, we are refreshing our Surgery of the Future concept to ensure we are staying ahead of the likely requirements for hybrid physical and digital consultations. There's been a lot of talk about the impacts of COVID-19 beyond the terrible death toll and the lockdowns. This includes the backlog of surgical procedures and cancer treatments and the potential implications of long COVID. One of the key element is the toll it has taken on mental health, which must now be tackled as a priority. This is another example of the need for joined-up service delivery across the NHS. One way of supporting this is through the bringing together of multiple primary care practices in delivering a wider range of services across several locations. A number of key primary care at scale players are starting to emerge, and this is a trend we expect to see continuing. Responding to these market themes and anticipating future trends by staying close to our customers and the local health system, is integral to the future success of Assura. To this end, this year, we have expanded our capability in development through the acquisition of Apollo. We have enhanced our design innovation capacity as evidenced by our Designing for Everyone program. And we are leading on a number of net zero carbon initiatives. One potential opportunity is community diagnostics. Professor Mike Richards published his report early in the year, describing the benefits of diagnostics and testing undertaken in the community at retail parks, at new dedicated centers or at GP surgeries. Our existing network of centers and relationships in primary care mean we are ideally placed to support this shift, and we are in discussions with potential partners. This is a good example of how the delivery of services away from hospital sites could play a key role in freeing up hospital capacity. We have several opportunities that we are pursuing that support this trend. In Cramlington, we are working with Northumbria Healthcare Foundation Trust on a training and clinical facility with the potential to accommodate primary care services. In Birmingham, we are developing a new state-of-the-art facility for an ambulance trust. And we are in discussions with a further hospital trust about a major scheme that we hope to finalize in the coming weeks. As I have already mentioned, there is a pressing need for greater access to mental health services, which are often provided in poor-quality buildings. We see an excellent opportunity for Assura to use our specific skills and experience to deliver appropriately designed and purpose-built premises for this need. We have recently acquired a site in Greater Manchester let to a mental health trust, and we are evaluating several further opportunities. The emergence of primary care at scale is a key strategic opportunity for us. Assura has the breadth of expertise to help these emerging organizations in developing their estate strategies, supporting their property management requirements and enhancing and developing new assets to support their growth. I am pleased to report that we have now signed a strategic partnership with one of the leading players in this area. In addition to these NHS opportunities, we continue to selectively pursue partnerships with private sector providers. The response to clearing the current backlog in treatments in the NHS can only realistically be tackled through a joint effort between the NHS and the private sector. We recently completed a facility for Ramsay Health Care in Stourbridge and are working with Genesis Cancer Care across several locations. We started today's presentation with hearing from Lisa and Luke about the challenges of the past year. Our GPs have also had to respond to a radical change in the demands placed on them, and the way they deliver their services. Our local health systems, too, have had to adapt by accelerating existing trends to a more integrated approach to service delivery. Against this backdrop and throughout the year, our teams have continued to support our customers. They've had to adapt, experiencing various degrees of isolation and disruption to working patterns. Despite this, they have continued to deliver against our growth plans, have made key progress in sustainability and in innovation, and have developed our scope for future growth, supporting further increases in our dividends. We now face a complete turnaround as restrictions are gradually lifted. Team meetings return, face-to-face discussions with customers resume, and routine site visits began again. This year has shown the team's remarkable capacity to deal with change. The coming events will require the same and more. But if we meet this challenge, we will be a much stronger company and we will be in a position to our purpose, our values and our passionate commitment to social impact, to maximize our contribution to the NHS. And on that note, I will leave the final word to one of our GPs, Dr. Tina Murray talking about through medical center in Somerset, a groundbreaking building with one of the country's most innovative approaches to general practice and social prescribing. [Presentation]

Now that concludes this morning's presentation, and we are happy to respond to any questions you may have.

Thank you for listening this morning. I'll now take each question in turn. I'll read out the question one by one and then respond with the answer. If you'd like to continue submitting questions during this part of the presentation, then please feel free to do so. So the first question is from [ Stephen Binny ] from [indiscernible]. The question is, what do you see as the key challenges to operating in this industry for the next 10 years? So very much a long-term view from Steve. So I guess one obvious thing to highlight, as I did referenced in my presentation, is clearly responding to the whole net zero carbon challenge and potential climate change has to be absolutely central for any business, and in particular for any real estate business. So making sure that we stay absolutely at the forefront of new technologies on construction, on management and on making sure we reduce our carbon footprint is definitely going to be essential. And then I guess the other thing I would flag is just really what I tried to call out a little bit, which was the need to respond to the changing requirements. Though the NHS never stands still, the healthcare doesn't stand still, we are constantly looking to adapt and respond to what the future might hold. That -- you can see that in our Surgery of the Future concept and also, you can see that in our response to some of the challenges in [ fashion code ] this year. So that -- I would highlight that as absolutely essential as well. Second question is from Kanad Mitra from Barclays. Actually, I think there's a nest of about 3 questions in here. But can you provide a bit of color on the investment market? Are there particular pockets where we see the market heating up, specifically lot sizes that we operate? Given that the net initial yield is down 4.5%, what kind of yields are you looking for going forward? And how much firepower will be left after spending on the pipeline? So I'll leave that last one to Jayne, and I'll take the first 2 first about the investment market and yields. So in terms of the current market, there are undoubtedly certain areas of increased pressure on prices, in particular very large lot sizes in excess of GBP 10 million. Anything with an RPI lease is increasingly attractive to the annuity funds and other pension providers. And there is a strong market preference for London assets, which reflects a relatively modest price differential for assets in the capital and the scarcity. So those are the 3 elements that I would highlight where we're definitely seeing particular pressure on yields. In -- it is strong across the board, though. So we are also seeing good levels of demand for all tax assets, but those are particularly so. In terms of yields, you referenced that we're at 4.5% and asked what we're looking at going forward, we're not in the business of giving the forecast, but we would anticipate that yields forward-looking basis would remain very similar to where we are now. And certainly, that's what we're seeing in the market. And we're very careful to make sure that we are only securing those assets that would meet our minimum return criteria. So the final part was an interview with the firepower after our pipeline, so I can pass Jayne that.