IRES.IRIRES.IRDUB
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Operator: Hello, everyone, and thank you for joining the Irish Residential Properties REIT plc 2025 Preliminary Results Conference Call. My name is Harry, and I'll be coordinating your call today. Joining us on today's call are Eddie Byrne, Chief Executive Officer; Brian Fagan, Chief Financial Officer; and Stephen Mulcair, Investor Relations. [Operator Instructions] I will now hand the call over to Stephen Mulcair with Investor Relations to begin. Please go ahead.
Stephen Mulcair: Good morning, and welcome to the Irish 2025 Preliminary Results Call. We're excited to share our strategic progress and financial results with you today. Joining me is CEO, Eddie Byrne; and CFO, Brian Fagan. Before I hand over to Eddie, please note that some statements made today may be forward-looking and subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. For detailed information, please refer to the Risks section of our results issued today. I'll now hand over to Eddie to provide an overview of the results for the year.
Eddie Byrne: Thanks, Stephen. Good morning, everyone, and welcome to our 2025 preliminary results presentation. The past 12 months have marked a step change in both our operational and financial performance, driving meaningful improvements in margins and earnings. Our strategic initiatives have delivered tangible results, underpinned by our relentless focus on operational excellence and cost control, all powered by our internalized operating platform. Our asset recycling program continued to deliver, generating sales premiums over 25% above book value. Our disciplined approach to capital allocation is totally focused on creating sustainable long-term shareholder value, and the momentum is set to accelerate as we look to capitalize on favorable regulatory and market trends. The coming year will present exciting opportunities to expand on the strong foundation we built in 2025. Turning to the numbers. Our unwavering commitment to cost management has driven a 120 basis points margin uplift, directly boosting earnings. In 2025, we have sustained and strengthened on the earnings growth trajectory we established in 2024, with adjusted EPRA earnings per share up 2.3% year-on-year. Operationally, our platform continues to deliver. Occupancy remains at an impressive 99.5% with rent collections exceeding 99%. Asset disposals into the owner-occupied market have further enhanced our results with adjusted earnings, excluding fair value movements, growing by a strong 7.4% across the full year. And in line with Irish REIT legislation, we are proposing a final year-end dividend of EUR 0.0253 per share, bringing our full-year dividend to EUR 0.0489, an increase of 20% on 2024. As at the 31st of December 2025, our EPRA net initial yield stood at 5.2%, with asset values improving slightly compared to the prior year due to improved operating performance rather than any yield tightening. PRS prime yields have now been stable for 2 full years. And looking ahead, we are confident in the outlook for valuations as major headwinds, including elevated inflation, interest rates, and restricted rent controls, have largely subsided. Greater liquidity and embedded reversion in the market in general is expected to have a positive impact on yields over time. On the balance sheet, we successfully refinanced our debt and returned surplus capital to shareholders through an accretive share buyback during the year. We continue to see an increasing number of opportunities for growth in the market. There has been a significant shift in market sentiment in PRS since the government announced a suite of changes to the regulatory landscape. We are very positive on the outlook for growth for the business over the coming year. Importantly, overall, we have continued to deliver across all measures within our control. The regulatory landscape is shifting positively with the government's announcement of the revised rental regulation, representing a very positive development. These changes will substantially enhance our business outlook, and I'll go into further details on the reforms later in the presentation. Turning now to Slide 6. As we look at this slide, I want to highlight the core strategic pillars that underpin our business and drive our success. These pillars provide a clear blueprint for our management team to maximize value creation for our shareholders. We are constantly refining our operating strategy to ensure we stay ahead of market trends and seize every opportunity to deliver outstanding results. We also maintain a sharp focus on reviewing all capital allocation options available to the company, ensuring we remain agile and responsive in a dynamic environment. Our unique and fully internalized operating platform, further strengthened by advanced digitalization, sets us apart in the market. This enables us to consistently drive operational excellence and cost efficiency, maximizing value for shareholders. We are relentless in our pursuit of value creation. Our strategy is anchored by a commitment to maintain a robust balance sheet, moderate gearing, and flexible financing by managing our loan-to-value ratio, financing costs, and maturities with discipline and foresight. Optimizing our portfolio is at the heart of our approach. We are actively recycling capital from assets, channeling proceeds into either our existing portfolio or looking to selectively acquire high-quality, better-yielding assets whilst continuing to manage the LTV. Where it makes sense, we are ready and able to return capital to shareholders efficiently, demonstrating prudent capital management, evidenced by our share buyback during the period. Sustainability is also a core element of our strategy. We consistently work to ensure our portfolio is fit for purpose over the long term and continues to generate the returns we expect. As a plc, we operate as a responsible business with strong governance frameworks in place. As we look across our performance for the full year, we've executed strongly on each of these strategic priorities. Our operational metrics are exemplary. Our asset recycling program continues to deliver significant value. Our capital allocation remains highly efficient and aligned with our strategic framework, and our balance sheet and financial position has strengthened. Having executed on our strategic priorities, the business enters 2026 well-positioned to capitalize on the growth opportunity and deliver strongly for shareholders. Moving on now, I'll discuss some of the positive changes that we've seen across the regulatory spectrum. As you are all likely aware, rent regulation has long presented significant challenges for the Irish residential sector. However, the landscape has now shifted decisively for the better. Following the government's substantial changes to rental and other regulations, we are entering a new environment that is set to stimulate investment and accelerate the development of much-needed homes across Ireland. This progressive suite of rent, building design standards, and VAT reforms marks a pivotal moment for the sector. The headline changes include Rental property owners will be able to reset rents to market levels for all new tenancies commencing from the 1st of March 2026, bringing greater flexibility and transparency to the rental market. Importantly, this will allow us to gradually bring rents across our portfolio back to the prevailing market rate over time as units turn over. While annual rent increases remain capped at 2% or the rate of inflation, whichever is lower, the index for inflation will move from HICP to CPI, which has historically tracked higher, ensuring a more realistic market conditions. Crucially, new build properties will be exempt from the 2% cap and instead will only be limited to CPI, providing a genuine incentive for development and investment in new builds. Under these rules, every unit in our portfolio with the lease commencing after the 1st of March 2026 can be relet at prevailing market rents once vacant. Currently, our independently assessed rents are approximately 20% below market. And while in 2024 and 2025, around 14% of our portfolio turned over, we do see this moderating slightly into 2026 to around 10%, but we do not see it going below that level based on historical data from our resident surveys. The opportunity to realize this embedded reversion is substantial, and we expect it to translate into enhanced returns for the company and our shareholders. But importantly, whilst this change is set to be a substantial driver for our business and will enable us to contribute to increasing the supply of rental accommodation in Ireland, the mechanics of the legislation ensures that renters will continue to be protected at the same time. Looking at the wider market, these changes are set to make a real difference. By addressing long-standing viability challenges, the reforms will encourage greater investment into the Irish residential sector, improving liquidity, which will potentially lead to a tightening of yields over time. As shown by the graph on the bottom right-hand side of the slide, restrictive regulations have led to a substantial drop in investment in PRS assets over the subsequent years. The new changes will take time to translate to the level of investment that is needed, but we are already seeing a shift of sentiment and the potential for new fresh capital to enter the market since the government has announced these changes. We are optimistic about the future. The new regulatory framework puts Ireland on a more competitive footing and will unlock fresh investment, drive growth, and support the creation of new homes nationwide. It's an exciting time for our sector and a positive turning point for the Irish housing market. I'll now hand over to Brian to run through the financial results for the year.
Brian Fagan: Thank you, Eddie. Good morning to everybody. Moving to Slide 10, where we provide a summary of our financial performance for the year. Growth delivered through continued operational excellence. Looking at the P&L, these results reflect our team's expertise and commitment. We manage one of Ireland's largest highest quality residential portfolios, delivered by an experienced in-house team and with a fully integrated digital platform that adds significant value. Our unique operating model is what sets IRES apart. We are Ireland's only solely residential rental company with permanent capital and a fully internalized management team. No other public or private residential owner matches this. By managing maintenance, leasing, revenue management, and operations in-house, we achieved material cost efficiencies while maintaining exceptional resident service. This structure allows us to build deep operational knowledge and harvest large amounts of data, which helps improve decision-making, efficiency, and scalability. As a result, we consistently deliver near full occupancy and rent collections in excess of 99%. This market-leading performance directly drives shareholder value. Today's results demonstrate the strength of our operating model and its ability to deliver significant value for shareholders, not only in the short term, but particularly over the longer term as the opportunities to leverage these capabilities through scale materialize. We are very pleased to report an excellent performance for 2025. Revenue increased by 0.2% year-on-year despite being impacted by the sale of approximately 1% of units in the portfolio and a lower HICP outturn, inhibiting our ability to capture rental growth. NRI margin increased by 120 bps to 78% as a result of our continued intense focus on cost management and driving ancillary revenues. At 99.5%, the portfolio remains effectively fully occupied. Financing costs increased by 4% during the year, mainly reflecting accelerated amortization of deferred loan costs associated with our owned RCF, which was refinanced in March 2025. Adjusted EPRA earnings increased by 1.5% to EUR 29.4 million. Adjusted EPRA earnings per share increased by 2.3%, reflecting improved operating performance and the benefit of our share buyback program. Our ongoing asset recycling program continues successfully, resulting in adjusted earnings increasing by 7.4%. This strong operational performance and also the fact that we had no nonrecurring costs in the year means we have delivered EPRA EPS growth of 16%, whilst we have also returned to profitability with profit before tax of EUR 49.7 million. Following today's results, we have proposed that a final dividend of EUR 0.53 per share will be paid, in line with our policy of maintaining an 85% payout ratio and in compliance with Irish REIT legislation. This brings the full-year dividend to EUR 0.0489 per share and represents a 20% increase on 2024. And now turning to Slide 11. Robust financial position and improving valuations. On the financing front, we successfully refinanced our revolving credit facility in March 2025, securing a new EUR 500 million RCF plus a EUR 200 million accordion facility, adding greater flexibility to our capital structure. The facilities have a 5-year term to March 2030 with 2 potential 1-year extensions. We have put in place EUR 275 million of hedging instruments for 5 years, maintaining fixed-rate debt at approximately 85% of drawn facilities. As a result, our weighted average cost of interest for 2025 was 3.71%, slightly lower versus 2024 at 3.79%. Following this refinancing, our weighted average debt maturity has increased to 4.1 years, ensuring no near-term refinancing risk for the company. In line with our ESG principles, we converted the RCF to a sustainability-linked loan in November. In 2025, our portfolio recorded a fair value gain on investment properties of EUR 17 million, underpinned by improving asset and operational performance and aided by the stable yield environment across the wider Irish residential market. At year-end, our gross yield stood at a robust 7%, providing a good spread over our weighted average cost of interest at 3.71%. Our net LTV at year-end was 43.6%, down from 44.4% at December 2024. Market dynamics remain favorable. Prime PRS yields have held flat for 2 years, even as inflation has moderated towards the 2% target and the ECB has implemented 8 interest rate cuts since peak. Despite Ireland's 10-year sovereign yield being lower than many developed European nations and the country's strong credit profile, the spread to prime residential investment yields in Dublin remains wider than in peer cities. This, coupled with Ireland's exceptional market fundamentals and the easing of headwinds such as inflation, interest rates, and regulation, positions us well for potential future yield compression in line with European peers. We are seeing further support for valuations, thanks to new rental regulations, which will allow rents to be reset when a tenant vacates and the new lease commences. Legislation is set to take effect on the 1st of March, so has not yet impacted valuations, but we anticipate a positive uplift to property values as income profiles improve, provided market yields remain unchanged. Moving now to Slide 12. Executing on asset recycling strategy. During 2025, another 41 units were disposed of as part of our ongoing multiyear asset recycling program. We are achieving strong pricing with average sales prices coming in at over 25% above book values. As a result of these disposals, adjusted earnings, excluding fair value movements, increased by 7.4%. This brings the total number of unit sales to date to 107. And at December 2025, we had an additional 21 units classified as held for sale. To date, total proceeds amount to EUR 35 million. We will continue to actively dispose of the identified units once they achieve vacancy. And given the sales prices achieved in 2025, we expect that the disposal premium will continue to remain strong in 2026. We have seen a real increase in the number of investment opportunities in the market. There's been a significant shift in market sentiment and development activity in PRS since the government announced a suite of changes to the regulatory landscape. We are very positive on the current growth outlook. And given the performance of the disposal program, proceeds of EUR 35 million reduced LTV, we are confident that we will be able to execute on opportunities to recycle this capital into higher-yielding bolt-on acquisitions at attractive prices over the coming period. Before I hand you back to Ed, as many of you know, this will be my last full set of results before my retirement, and I would like to take this opportunity to thank all of you for your continued support over my last 5 years as CFO. I wish Mari Hurley all the best in the CFO role, and I look forward to meeting with many of you to discuss this set of results over the coming weeks and months. Thank you.
Eddie Byrne: Thank you, Brian. Looking now at Slide 14. The key message on this slide is that Ireland is operating from a position of economic strength, with the current macro backdrop highly supportive of long-term investment in residential rental accommodation. Ireland combines strong domestic fundamentals with improving external conditions. Employment remains exceptionally high. Economic growth continues to outperform European peers. The interest rate environment is improving, and the state's fiscal position is one of the strongest in Europe. Together, these factors create a stable, low-risk environment that underpins sustained demand for housing. High employment and personal income visibility support household formation, rental affordability, and occupancy, which are drivers of residential property performance. At the same time, Ireland's superior growth outlook relative to the EU and euro area reinforces long-term population and housing demand, particularly in cities and commuter regions where supply remains structurally and chronically constrained. Importantly, the macro cycle is now turning more positive. The shift in the ECB policy following a series of rate hikes, which peaked in 2024, improved funding conditions and sentiment across real assets. This supports valuations, enhances development viability, and increases investor confidence at a point where new housing supply is urgently needed. Overlaying all of this is a very strong sovereign balance sheet. Ireland's budget surplus and low relative debt position provide resilience against external shocks and give the government flexibility to continue supporting infrastructure and housing delivery. This brings a materially reduced macro risk compared to many other European markets. In summary, Ireland offers a rare alignment of strong labor markets, above-average growth, easing financial conditions, and fiscal strength. When set against a persistent undersupply of housing, this macroeconomic environment provides a compelling foundation for investing in residential accommodation with visibility on demand, stability of income, and long-term growth. Moving now to Slide 15. At a more structural level, Ireland continues to experience sustained population growth driven by both natural increases and strong net migration. This is occurring alongside high employment levels and income growth, which together are expanding the pool of renters and reinforcing depth of demand across the private rental sector. Importantly, this demand growth is not cyclical in nature, but rooted in long-term demographic and labor market trends. These forces are translating directly into persistent rental demand, particularly in Dublin and other key urban areas where housing supply has consistently failed to keep pace. As a result, occupancy remains high, and income visibility is strong, providing a stable foundation for residential cash flows. From a pricing perspective, Irish prime PRS yields have remained unchanged for the last 2 years despite the easing of inflation and interest rates. While Irish yields continue to be an outlier relative to European peers, this can largely be explained by Ireland's more restrictive rent regulation framework rather than weaker market dynamics. Looking forward, there is growing regulatory clarity and stability in the PRS market. With a more balanced framework governing rent setting, it is expected we will see increased institutional investments, improve liquidity, and ultimately encourage new supply. As regulatory risk diminishes, Irish PRS yields are increasingly positioned for compression, particularly when set against comparable European markets and considering the relative spread to sovereign yields in those markets. In combination, strong demographic growth, resilient employment, stable income performance, and improving regulatory certainty create a highly compelling macroeconomic backdrop. Set against chronic undersupply, these factors support sustainable rental growth, low vacancy risk, and attractive long-term returns for residential investors in Ireland. Turning now to Slide 17. There is a clear and compelling opportunity ahead for IRES. Our strong operational performance and delivery against our strategic priorities has positioned the business extremely well as market conditions improve. Demand for high-quality rental homes in Ireland remains exceptionally strong, providing a resilient foundation for our income and long-term growth. At the same time, the headwinds that have constrained the PRS market in recent years have now reversed and have materially improved the outlook for our business. We enter this next phase with clear strengths. We have operational excellence, improving NOI margins, exceptional collection rates, efficient leasing and turnovers, and high tenant satisfaction. We have a market-leading platform fully internalized, vertically integrated, and highly digitalized, giving us control, scalability, and efficiency. We have a strong balance sheet, LTVs within target range, improving valuations because of improving operational performance, and long-term flexible debt in place. We have a high-quality, fully occupied portfolio, modern assets located in high-performing locations with strong reversionary income, values well below replacement cost, and excellent sustainability credentials. These company strengths are now aligned with a rapidly improving external context, lower interest rate environment, optimistic outlook on valuations, regulatory and planning frameworks have improved. Transaction activity is returning and gaining pace. And importantly, demand for rental accommodation continues to significantly exceed supply. This dynamic is unlocking new opportunities in the Dublin PRS market, and we believe we are uniquely positioned to capitalize. Our asset disposal program is delivering exceptional outcomes, with sales delivering premiums of more than 25% above book value, equivalent to selling at around 4% net yields. We see a strong pipeline of earnings-enhancing assets coming to the market, which are suitable for reinvestment of those disposal proceeds. Our message is clear. We are delivering on what we said we would do. We are confident and optimistic about the direction of the business. With strong operational execution, improving market conditions, and some of the most supportive demographic dynamics in Europe, we believe the scale of the opportunity ahead is very significant. And before I move to questions, I would just like to mention Brian, who has highlighted that this will be his last full set of results, and I would like to take the opportunity to thank him. But there is plenty of work to do before he hangs up his boots for good. So we'll get on to that before we do the formal thank you. With that, I'll open it to questions.
Operator: [Operator Instructions] And our first question today will be from the line of Colin Grant with Davy.
Colin Grant: A couple of questions from me. Congratulations on a very good set of results, and well done to the team. Just firstly, in terms of your net rental income margin, which increased 120 basis points during the year, that's very strong given the dilutive impact of disposals. And you've mentioned the cost efficiencies that you've put in place. I wonder if you could give us a bit more color on some of the actions that you've taken during the year and whether or not you see more scope for things to take place in 2026 in that area on the net NRI margin? And secondly, just in terms of the market, which is clearly strengthening, and you've mentioned the potential for a strong pipeline there. I'm just wondering if you can give us a bit more color on the scale of what you see potentially coming 2026 and beyond in terms of portfolios coming to the market, and also just the kind of liquidity that you see in the market at present.
Brian Fagan: Thanks, Colin. Colin, I'll take the question around the margin, okay? Yes, look, you are correct. We improved our margin year-on-year by 120 bps, right? And that involves initiatives right across the range of our operating costs and also then some ancillary revenues. So ancillary revenues, we increased car parking income, for instance, right, okay? On the cost side, it would have involved us looking at our -- basically our purchasing arrangements, and trying to get better bang for our book. So one example was insurance, right, okay? So we had renewed our broker, and we've got our broker to go out to the market for ourselves, but also then to use our buying power, together with the OMCs to go and get better savings. We didn't just go to the Dublin market. We also went into the London market. Other aspects we have been organized on a geographical basis in the Dublin area. So we've 3 offices, right? And each of the locations must, we say, buying a lift contract from Colin, from Brian, from Amedi, we've combined that now, so they're just buying from the best price provider. Do we see much scope going forward? At the half year, we were at 78%. There had been some one-offs in the first half. We said we would work very, very hard to maintain that in the second half. As Eddie said, we have done that. Look, our ability to go forward, we absolutely will strive. And no stone will go unturned. However, as we are all aware, our rents are 20% reversionary, right? So it does limit our ability to go and get into the [indiscernible] But as we see the new rent regulations coming in, there should be definitely benefits to our NRI margin.
Eddie Byrne: And maybe, Colin, if there's no follow-up on that, then I will just take the scale of the opportunity that's out there. We have seen a very significant increase in the pipeline that the sales brokers would talk about, right? So if you went into this time last year, there might have been -- you could count the potential deals on the finger of one hand. You'd probably need a 4 hall now to count what the pipeline looks like at this stage. So we would see not just of standing stock, and we were saying this 12, 18 months ago that there is a -- once the rent legs changes and that brings certainty to the market, whatever the changes happen to be, as long as there was certainty, you would see all the deals that hadn't traded in the previous number of years start to come to market. So we see a very significant pipeline. In addition to that, we also have a number of conversations ourselves, our own pipeline around some potential new build stock. So it's not just all necessarily standing stock. And I think we have explained this before. Every development within the Greater Dublin area must -- because of densities, must have houses, apartments, and duplexes. And there hasn't been a viable exit for a lot of the apartments unless they were going into the state, and that's starting to change now. So we see an increase in that. And then more importantly, that's all on the sales side. In terms of capital coming to the market, the last couple of deals that have gone say and agreed, maybe under contract now at this stage, are contracted to new entrants in the market, new European in both cases. So I think there is -- there will be a lot of supply. But very importantly, there is also demand, and that's been our own experience as we go and talk to various forms of capital throughout Europe. There is a -- I think the expression that's used is this makes Ireland investable again in terms of the rent regulations. So I think the liquidity, the scale of the opportunity, I think that's all very positive.
Operator: The next question will be from the line of Eleanor Frew with Barclays.
Eleanor Frew: Three questions from me, if I may. I'll go one by one. Firstly, can you give any indication of where you expect your like-for-like rental growth to land this year, thinking about balancing inflation with upside you can get from retrofitting, and of course, the impact from the new regulation?
Eddie Byrne: Well, I guess, Eleanor, as you know, we don't do guidance. However, we have seen a number of -- including your own models. And look, I mean, it's not a complicated sum really. We expect about 10% of our portfolio to turn over this year. We expect 90% of the portfolio to remain at the 2% level. And then we would expect to see that 10% grow at the level of reversion, the independently assessed level of reversion in the portfolio of 20%. So when you do those sums, it comes up with a number pretty close to the number that I think most of the analysts would have.
Eleanor Frew: And then occupancy, obviously very high. How do you see that trending over the year? And then more broadly, looking further out, do you see any risk to that occupancy from the new supply, given the more attractive regulatory environment?
Eddie Byrne: Well, you know what, the new supply, Eleanor, is -- it takes at least 2 years to build anything. So that's definitely not an issue for 2026 or 2027. I mean I think in terms of our occupancy, it -- well, it's not going to go up much. I can tell you that. But in terms of going down, one of our key operational metrics for our staff is to maintain that occupancy level. I don't think turnovers will impact that as much, possibly a couple of small basis points, but it's really -- that's a point in time. So I don't see the rent regulations having a negative impact on our occupancy because we will continue to drive what we think is our operational excellence to make sure that we don't have vacancies. So I think occupancy remains fine.
Eleanor Frew: And then last one, so you mentioned a strong pipeline of earnings-enhancing assets. Are you going to limit yourself to just reinvest in your disposal proceeds? Or is there scope for external capital if the deals are accretive enough?
Eddie Byrne: Well, certainly, in the first instance, what we would see ourselves doing is reinvesting the capital that we have internally generated. So over the last 2 years, we've generated somewhere in the low to mid EUR 30 million, and we would see ourselves reinvesting that in the first place. Above and beyond that, then will depend on the opportunity and the circumstances at the time. But we absolutely are tracking all of the opportunities in the market, and we'll consider how we could participate in those. So we are -- all options are on the table for us. But in the first instance, it's reinvesting our internally generated capital.
Operator: Your next question will be from the line of Denis McGoldrick with Goodbody.
Denis McGoldrick: I just have one, actually. I got a couple of the other ones ahead. Just in terms of the asset recycling program, so 41 disposals in '25, 21 sales agreed. Just wondering how we should think about that pace of disposals into '26 and then the implications of that for net rental income.
Eddie Byrne: Yes. So what I would say is we would view the program has been very successful to date, Denis. And I think one measure obviously is how many units we sell, but the other measure is the total proceeds. I mean you can see that we've generated a premium of 3.4 million above book value on the 41 units we have sold. That 3.4 million is in excess of the premium that we expect to generate across 50 units for the year. So that really is a key measure that we look at because it is very hard to predict exactly when a unit will close because you have at least 2 sets of lawyers, buyer and seller. And in many cases, because we're selling apartments, we also have a lawyer for the OMC, 3 sets of lawyers, and the banks involved in the financing, typically. So getting our own side of the transaction in shape is one thing, but we can't control the others. And I think if you look across -- even government are going to multiyear targets now rather than single-year targets because they've seen the folly of trying to predict exactly what gets delivered in a 12-month period. Having said all of that, we would continue -- we would see -- obviously, the units held for sale, and I would just clarify there, I think you said sale agreed. Held for sale is not exactly the same as sale agreed. So these are units that are vacant, which we are currently selling, some of which may be on contract and some of which are not. But 20 units is -- 21 units is a strong pipeline. In addition, we have another -- probably another 10 units at this stage, which are not vacant, but where we have received notice of the tenant leaving. So our pipeline is of the order of 30 units in February for 2026. So we would feel comfortable that we will continue to do on the order of what we said this year or last year, we were hoping to do 50 units. And I think one of the things that you will see going forward is that selling units is just a normal course of our business, right? It's not -- we did announce a program in 2024 of 314 units, and we will continue to sell all of those units. And when those units are gone, we will continue to refine our portfolio and look at units that are non-core. So I think that's probably the way to think about our sales program is that every year, we will have -- we will consider the previous year of business that we need to do to refine our portfolio. that will become our target for the year. But for 2026, I think you can think about it in the same quantum of the 50 units there or thereabouts that we had said we would do this year.
Operator: The next question today will be from the line of Steven Boumans with ABN AMRO ODDO.
Steven Boumans: I appreciate the positive view on the investment opportunity set and understand, of course, you want to fund it with proceeds from disposals. However, if some great opportunities arise, some questions, could you -- which debt metrics, such as LTV, would you be willing to go to if good investment would rise? And second, would a scrip dividend be possible next year? Maybe provide your considerations on the potential of a scrip dividend.
Brian Fagan: Okay. Stephen, thanks for the question. I think what I would say in the first instance is we've been pretty clear over the last couple of years, management and the Board have a strategy around LTV to manage it between 40% and 45% through the cycle. So I don't see that changing. We'll continue to manage it within that range. Clearly, with the view to being at the lower end of the range as we reach the end of a cycle now we're -- we have to be very careful, and everybody needs to be careful about calling the top and bottoms of markets, right? But as we move through the cycle, we will be managing that down a little bit. So any acquisition has to fit within that plan of 40% to 45%. And in relation to a scrip dividend, look, we keep everything -- we have not done a scrip dividend in the past. We keep everything on the table. There is -- we feel a little bit of a lack of clarity just around the regulation and scrip dividends. So that is something that we have been spending some time looking at. And I would say -- as I said, we will keep everything on the table to ensure that what we're doing is the right allocation of our capital.
Steven Boumans: And maybe one last question. I understand correctly that you see also opportunities in development. So you are also looking at funding deals. There's a probability that you will sign something like that in '26.
Brian Fagan: That is definitely part of the suite of potential opportunities that we see. We think one of the issues for development in Ireland has been lack of capital available to a lot of developers. We think we can bring our balance sheet to bear on that and enter into contracts with those developers, take, which will then allow them to go and get financing. So we do think that that is an important part of the role that we will play in terms of increasing housing supply in Ireland. So yes, funds are definitely on our agenda. And I would certainly see us doing that before we would necessarily develop ourselves. We don't really feel the need to definitely not take planning risk, other than we have 2 very small sites of our own, which we will continue to bring through the planning process. But in terms of buying land and taking planning and development risk, that would -- I don't see that happening. And in the first instance, forward funds developers take the planning and development risk, and we will take the completed product, and will absolutely be part of our suite of options.
Operator: Thank you. That will conclude our Q&A session for today, and I'll now hand the call back to Ed for closing remarks.
Eddie Byrne: Thank you very much, everybody, for listening in today, and we look forward to meeting many of you on the road over the next couple of weeks. We've got a lot of meetings in the diary. So hope to catch up with you then. Thank you very much.
Brian Fagan: Thanks, everybody.
Operator: This concludes the Irish Residential Properties REIT plc 2025 Preliminary Results Conference Call. Thank you all for your participation. You may now disconnect your lines.