Triple Point Social Housing REIT (LON:SOHO) reported full-year results for the 12 months ended December 31, 2025, highlighting higher earnings, improved dividend cover, and continued work to address legacy tenant issues through portfolio optimization and lease assignments.
Financial performance: higher income, lower costs
Management said net rental income increased 12% during the year, driven by inflation-linked rental uplifts and active asset management. Total rental income rose year-over-year from £35.8 million to £40.0 million.
Adjusted EPRA earnings per share increased 21% from 5.4 pence to 6.5 pence, which management said resulted in the dividend being fully covered for the first time since IPO, at 1.17 times. The company’s adjusted EPS was reported at 6.53 pence per share. Management reiterated that the dividend target had been increased last year by 3% to 5.62 pence per share, and said the “healthy dividend cover” supports a progressive dividend policy, with the next increase to be announced after the AGM in May.
The EPRA cost ratio fell to 18.7%. While noting the operationally intensive nature of the portfolio, management said it still considers this ratio “too high” and expects it to decline as the company moves away from “pass-through leases.” A £900,000 increase in non-recoverable property costs was attributed mainly to the “pass-through nature” of the MySpace assets, where costs on some properties exceed rental income and must be presented as expenses. Management said it expects these costs to reduce as those assets are resolved.
Balance sheet, valuation, and inflation linkage
Management emphasized the portfolio’s inflation-linked lease structure, stating that all leases include annual rent reviews and 86% are uncapped. For 2026, it said rental growth has already been “locked in,” with most rent reviews based on September 2025 CPI of 3.8%.
The company reported net loan-to-value of 39.5% and said it has debt fixed at an all-in rate of 2.74% with a weighted average term of 7.6 years, which it said limits earnings exposure to higher interest rates. Portfolio net initial yield was reported as 6.42%, unchanged since June 30, 2025.
EPRA NTA declined to 94.23 pence per share at December 31, 2025 from 99.5 pence a year earlier. Management attributed the decrease to valuation movements from an outward yield shift in the first half of the year and, in the second half, the reduction in value of properties expected to be sold following the portfolio review. It said it does not expect further property-level markdowns.
In Q&A, management acknowledged investor questions around NAV sensitivity to gilt yields, saying valuations are driven by gilts and interest rates, but added it was “too early to say” whether recent conditions would be sustained and noted the issue is not unique to SOHO, but affects the broader real estate sector.
Portfolio overview and tenant remediation progress
The company’s supported housing portfolio ended 2025 with 492 properties, providing homes for up to 3,412 residents across the UK in more than 150 local authorities. Occupancy rose to 87% as non-core vacant assets were removed following the portfolio review. Management noted an 80% occupancy level is an accepted profitability threshold in the sector and said it expects occupancy to rise further as assignments complete.
Contracted rent grew to £43.7 million. Management also updated on energy efficiency work, saying 77% of homes are now rated EPC C or higher, up 6% over the year and above the national average of D. It said it intends to complete the EPC upgrade program ahead of the 2030 target for socially rented homes, aiming for 2028, and in some cases improve assets beyond C to EPC B or A.
Portfolio optimization was described as focused on two work streams: assigning properties to stronger approved providers where performance was an issue, and disposing of a small number of assets where property characteristics were not suitable. Management said 88% of properties were already performing well and that disposals would involve about 1% of the portfolio, sold at book value.
Management detailed progress on three legacy areas:
- MySpace: Performing properties are being assigned to Inclusion under an option agreement, while non-performing properties are being vacated, residents rehoused, and properties surrendered and sold at book value.
- Parasol/Portus (Westmoreland): Stabilization is being achieved, and 20 properties have reverted to fully repairing and insuring (FRI) terms, with remaining properties expected to follow in coming months.
- Pivotal: Two properties were assigned to IHL following regulatory engagement at Pivotal.
As part of ongoing oversight, management said 442 properties were inspected during the year (nearly 90% of the portfolio). It also reported regular meetings with 92% of approved provider lessees and stated it met with the 10 largest care providers, which together support more than half of residents in the portfolio.
Policy backdrop and sustainability updates
Asked about the government’s attitude toward the social housing business model, management said the change in government has been “positive” for the residential sector and pointed to the £39 billion Affordable Homes Programme and a rent settlement guaranteeing rental uplifts at CPI + 1% for the next 10 years. It described specialized supported housing as a small segment of the broader affordable housing market but “vital,” citing the state’s obligation to house and care for residents and arguing the sector delivers efficient outcomes. Management also referenced its impact reporting, stating the portfolio delivers around £53.5 million of “social income” per year, including savings to the taxpayer for residents who would otherwise be housed differently.
On sustainability, management said it published its first standalone sustainability report and an annual impact report. It also said the REIT received an EPRA sBPR Gold Award and had its net-zero targets approved by the Science Based Targets initiative.
Growth priorities: cash-flow protection, acquisitions, and possible diversification
Looking ahead, management said it is focused on improving visibility and control over cash flows given that approved providers, while regulated, are not “strong covenants,” which it said contributed to historic credit issues in the sector. It said it is working with a key approved provider to set up ring-fenced bank accounts for rents, with the aim of improving cash-flow quality and mitigating credit-loss risk before expanding the approach to other providers.
Management also discussed “innovative avenues for growth,” including using shares as currency for acquisitions, referencing the Tritax Blackstone transaction as a precedent for listed companies serving as an exit route for illiquid private funds. It acknowledged challenges given the company’s shares trading at a discount but said it sees potential opportunities.
In addition, management said it is considering diversification into the wider living sector, but stressed any adjacent investments must be structurally supported, inflation-aligned, and earnings accretive, and must fit its expertise and maintain a similar yield profile.
On the company’s scale ambitions, management said it is focused on a first hurdle of reaching £0.5 billion and longer-term ambition of £1 billion, citing the importance of scale and liquidity in the current REIT market.
About Triple Point Social Housing REIT (LON:SOHO)
Social Housing REIT seeks to address the ongoing housing crisis by investing in the UK social housing sector, providing sustainable high-quality homes which have been adapted for vulnerable adults with long-term care and support needs including mental health issues, learning disabilities, or physical and sensory impairment.
We believe our residents deserve a home that offers greater independence than institutional accommodation, at the same time as meeting their specialist care needs. Our ambition is to be the leading UK Supported Housing investor, helping guarantee secure futures for people in need across the country, while ensuring that our shareholders have an ethical, solid, long-term income source.
