Welcome again, everyone to a special Towkay Talk this week.
Towkay Talk is a deep-dive into the intangibles of a company (aside from their reports and statistics) by talking to the key people behind the scenes.
The ones that run the day-to-day of the companies, and knows the ins and outs and this week, we want to do a spotlight on Elite UK REIT
Elite UK REIT owns and manages properties in the UK, which are primarily rented to the UK government.
At the centre of this Towkay Talk is its CEO, Joshua Liaw.
Mr Liaw has more than two decades of experience in real estate finance and fund management across the banking and real estate investment trust management sectors. Prior to his current role, Mr Liaw was Executive General Manager, Finance at the manager of Lendlease Global Commercial REIT (Lendlease REIT), where he led Lendlease REIT’s investment and capital management strategy as the Chief Financial Officer. Mr Liaw was part of the team that oversaw the initial public offering of Lendlease REIT in 2019 and the acquisition of Jem in 2022.
Let’s check in to see what’s going on!
Q1: Let’s start on the macro picture first. The conflict in the Middle East does not seem to be easing at this juncture. Since more than 99% of Elite UK’s income is derived from the UK government, how do you see the conflict affecting your tenants’ finances until the end of the year?
A conflict in the Middle East may lead to higher inflation and lower economic growth in the UK, as the UK is a net energy importer. However, the UK continues to maintain institutional credibility, and we have not observed any direct or immediate impact from the Middle East conflict on Elite UK REIT.
Nearly all of our leases are signed with the Ministry of Housing, Communities and Local Government, which is a Crown Body. With income stream that is government-backed, rent collection continues to be collected in advance.
The leases are also triple-net, which means that the tenant would bear the costs of operating the properties, including utilities and maintenance costs. Around 45% of the portfolio also benefit from in-built CPI-linked rent reviews, ensuring a balance of stability and sustainable growth.
Q2: Congratulations on a successful repositioning of the asset portfolio. Occupancy rate is up to 99.9% in 1Q 2026 from 93.9% in 2024, while the three new assets with non-Department of Works and Pension (DWP) tenants have a high gross rental yield of 9.2%. Is Elite UK REIT looking to attract more non-DWP tenants?
The conversion of Lindsay House, Dundee into a purpose-built student accommodation is well under way for completion before academic year 2027. Divesting assets and reinvesting into accretive opportunities would also result in improvements in our tenant mix.
Recently in June 2026, we announced an accretive proposed acquisition of five government-leased properties that will also bring a new tenant into our mix — His Majesty’s Revenue and Customs (“HMRC”). Just today 3 July, we also divested four properties in Wales that are occupied by the DWP. Including HMRC, we now have six non-DWP UK government occupiers contributing approximately 10% of annual rent.
