Habodel Sfr 1 Ltd

The directors present their strategic report for the year ended 30 April 2023. Operating review The year ended April 2023 has been a year of transition following the past few years of significant portfolio growth and scaling of the business' operations. The Group has continued to expand and develop the scope of its core operations so that it can reliably and effectively manage its principal portfolio, but at the same time ensure that its processes and procedures are well placed to cope with future investment and further scaling of its property sourcing and portfolio management operating streams. The Group has continued to invest significantly in its in-house ERP system, abode, which has developed in scope and functionality in response to the exacting requirements of the business. This continues to improve the Group's operation and management functions. In the year the Group rationalised its resource base and overhead levels in response to external macro factors and the expected timeline of future investment. The group has also made good progress, and continues to do so, in its debt restructuring by consolidating the level of high-cost debt by building on core relationships with its preferred lending partners. The underlying performance of the existing portfolio has considerably improved as its assets become stabilised post-acquisition & integration and are now generating consistent contributions. As part of this stabilisation process, the Group has continued to invest in the maintenance and development of its portfolio assets, to a self-defined level that is far ahead of the current standard conditions seen in the wider private rental sector. Tenant feedback collated from NPS surveys has confirmed that customer satisfaction with regard to the Group's properties and operating activities is high, and the Group continue to monitor and maintain these high standards as part of its fundamental values and strategic position in the private rental sector. Given the current increasing demand for housing nationwide, the Group has seen, and continues to see, even stronger rental demand, which alongside the portfolio stabilisation phase has contributed to higher occupation rates and strong year-on-year rental growth. After the period of these accounts and before the signing date, the Group has completed on its planned Group demerger and corporate re-organisation, so that it is now well placed to obtain and service new third party investment, as part of the Group's growth strategy. All of the above operating successes were achieved against the backdrop of a difficult macro environment, with inflation and cost of living challenges impacting interest rates significantly. Whilst the Group has inevitably felt the effects of these conditions, it is well placed to limit its impact, with rents historically tracking inflation and sufficient hedging in place within its current debt structure. Risks & Uncertainties Interest base rate uncertainty in this environment is a challenge faced by all businesses at this time. G2M Group's exposure is, whilst manageable, an area that the management team are monitoring and considering regularly. The Group continues to build on its debt restructuring exercise in response to this and has sufficient resources and options to ensure that interest costs remain sustainable in both the short term and beyond. Whilst the Group is now well placed structurally & operationally for external investment, and whilst its funding program continues to gather momentum, the Group does recognise that there is a level of uncertainty around the timing, level & structure of new investment. The Directors are confident that, given the opportunity for investors and the stable returns that the Group has evidenced, that the Group will secure substantial funding in the near future. In summary, the Group has made significant strides forward in the year and will continue to build on this into the future alongside new investor partnerships and subsequent increased scale of operations.