The LondonMetric Property dividend yield is sitting just below 7%, making it the second-highest on the FTSE 100, as the logistics-focused real estate investment trust (REIT) reports eleven consecutive years of payout growth. For income investors building a second income from dividend shares, the stock illustrates both the appeal and the risks of targeting high-yield UK equities.
What the Latest Results Show
LondonMetric (LSE: LMP) posted EPRA earnings of £305.3 million for the year to 31 March 2026, up from £268.0 million the prior year, according to the company’s FY2026 full-year results press release. IFRS reported profit came in at £295.7 million.
The investment property portfolio, valued on an EPRA proportionally consolidated basis, stood at £7,863.2 million at the same date. Gross debt was £2,952.3 million, giving a loan-to-value ratio of 36.7%.
According to Quartr’s earnings summary for LondonMetric, the dividend per share rose 3.8% to 12.45p for FY2026, extending the company’s unbroken run of annual increases to eleven years. Net rental income grew 17% year-on-year to £455 million.
The Annual Report and Accounts 2026 sets out the scale of the business: £7.6 billion of structurally supported assets, net contracted rent of £432 million per annum, and a total property footprint of 37 million square feet. The company describes its ambition as becoming the UK’s leading Triple Net Lease (NNN) REIT.
LondonMetric Property Dividend Yield in Context
REITs carry a structural advantage for income investors. UK legislation requires them to distribute at least 90% of qualifying profits to shareholders in exchange for corporation-tax relief. That requirement compresses the chance of a dividend cut, though it does not eliminate it.
LondonMetric’s particular focus on long-lease logistics properties adds a further layer of income predictability. Its weighted average unexpired lease term (WAULT) stands at around 18 years, and occupancy runs at 98%. Empty properties erode income; a near-full book locks it in.
The balance sheet is the main caveat. With gross debt of £2,952.3 million against a portfolio valued at £7,863.2 million, the company carries meaningful leverage. If interest rates remain elevated, debt-servicing costs could weigh on distributable income and, in a stress scenario, threaten the dividend.
The company has grown considerably in recent years. Its Annual Report 2024 recorded £6.0 billion of structurally supported assets, compared with the £7.6 billion disclosed two years later. The HY 2025 results showed EPRA net tangible assets of £4,671.3 million at 30 September 2025, with gross debt of £2,799.4 million and cash of £207.9 million at that point.
Over the past decade, the dividend has grown at an average rate of 5.56% per year, according to the original analysis. That compounds materially over time for investors who reinvest payouts rather than drawing them as income.
Building a Second Income: The Broader Picture
LondonMetric is one option among several UK dividend-paying stocks. The following yields are cited in current market commentary: Legal and General at 7.5%, Hilton Food Group at 6.7%, Investec at 6.3%, Imperial Brands at 6%, and National Grid at 4%.
Sustaining a blended portfolio yield of 7% over the long run typically requires holding a mix of high-yielding stocks, including some with less-established track records, to offset lower-yielding but more stable names. That adds risk to the portfolio.
The compounding effect can be material. An investor contributing £200 a month and reinvesting dividends at a consistent 7% yield could, on one set of calculations, accumulate close to £130,000 over 20 years. At that point, a 7% yield would generate roughly £10,000 a year in income. The key inputs are consistency of contribution, dividend reinvestment, and stock selection that avoids sustained capital erosion.
Unlike cash in a savings account, a dividend share portfolio carries the risk that capital value falls faster than income accumulates. Identifying businesses with durable revenue streams, whether in finance, utilities, healthcare, or logistics, is the standard method for managing that risk.
For LondonMetric specifically, the next test is whether the current leverage profile holds up as base rates evolve. The LTV of 36.7% and the 11-year dividend growth streak provide a starting point for that assessment.
