Good morning, and thank you for joining the I-RES 2024 Preliminary Results Call. We are joined today by the I-RES CEO, Eddie Byrne, and CFO, Brian Fagan. The presentation that will be given today, along with today's results announcement, is available to download on the Investor Relations section of our website. Before we begin, I would like to remind everyone that certain statements made today are or may be considered to be forward-looking and are therefore inherently subject to various risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements. We direct you to read in detail the preliminary results announcement issued today, which highlights these risks and uncertainties on page 19. I will now hand over to Eddie, who will provide an overview of the FY 2024 preliminary results.
Thanks, Stephen. Good morning, everyone, and welcome to our 2024 annual results presentation. 2024 was a year of progress for I-RES, underpinned by change both internally and in a market context. Internally, we appointed a new chair, new CEO, and completed an in-depth strategic review, resulting in a number of initiatives across the company. These initiatives cover changes in revenue generation, cost management, people and performance management, process change, and capital investment, but to name a few. Externally, Ireland had a general election, which brought a new government to power with a significant majority on a five-year mandate. We believe this is positive news for the residential sector, as a long-term focus is necessary for effective housing policy. At a macroeconomic level, we had a reduction in the interest rate cycle and moderation in inflation, but we also saw substantial geopolitical uncertainty throughout the year.
Notwithstanding the significant external and internal dynamics, I'm pleased to announce a set of results that show positive incremental changes across all parts of our business, particularly in the second half of the year. The company returned to earnings growth during the year, with adjusted EPRA earnings increasing by 1.4%. We continued to capture value by disposing of individual units into the open market, and reflecting the profit made on these disposals, adjusted earnings, excluding fair value movements, grew by 8.7% during the year. On a like-for-like basis, i.e., excluding the impact of our ongoing asset recycling program, revenue grew by 1.7%, notwithstanding the fact that prevailing HICP inflation was below 2% for much of the year, impacting our ability to achieve rent increases.
As of the 31st of December, our net initial yield stood at 5.1%, slightly up on 2023, but remaining the same as reported at half-year 2024, reflecting current consensus that residential market valuations may have stabilized. In line with REIT legislation, we are proposing a 2024 final dividend of EUR 0.022 per share. Moving forward, we intend to continue paying 85% of property rental income as a dividend to shareholders. As can be seen on the right-hand side of this slide, our improvements across key performance metrics were achieved by our continued operational strength. We achieved effective full occupancy at 99.4% and rent collections above 99%. The number of units owned was 3,668, down 66 from the previous year-end, reflecting the strong progress on our recycling program, which we announced as a result of our strategic review.
Turning now to the next slide, two of the primary internal levers for value creation we have available to us are asset optimization and capital recycling, which shareholder funds allocated according to our disciplined capital allocation policy, as outlined on the right of the slide. In this way, we continue to be laser-focused on unlocking value for shareholders in order to address the current discount to NAV. In August, we announced a program to sell 315 strategically identified units over a three- to five-year timeframe, and we are progressing well against that plan at pace and with pleasing values realized. The proceeds of this program will be used, in the first instance, to strengthen our balance sheet. The remaining excess capital will be returned to shareholders where possible and reflecting recent legislation.
During 2024, our recycling program completed the sale of 21 individual units to private purchasers at an average premium to June 30th, 2024, book values of 25%. We sold a further 20 units in the 315-unit program in a bulk sale to a private investor in line with book values, and separately, outside of the program, we sold another 25 units to a private investor, again in line with book values. We expect to sell at least a further 50 units during 2025, and at the 31st of January, we had 19 units either on the market, under contract, sale agreed, or closed. Consequently, at this early stage of the year, we remain comfortable with our projection of a minimum of 50 units for the full year.
In line with our capital allocation framework, the proceeds have initially been used to pay down debt, and at the 31st of December 2024, our net LTV stood at 44.4%, down 1% from the 30th of June 2024. In line with our ongoing asset management initiatives, in 2025, we will deploy a small amount of capital on retrofitting some units where we can increase their energy ratings by seven steps on the BER scale. Under current rent regulations, this will allow us to return these units to market rent. In 2024, we undertook some pilot retrofits, and this capital expenditure yielded a minimum of 8% on cost for us.
As a result, we will look to employ the strategy where applicable, but as you know, 92% of our portfolio is already BER rated A to C, so there are a limited number of units in the portfolio where this program is suitable. Finally, in addition to maintaining our 85% dividend payout to shareholders, this morning we announced our intention to shortly launch a EUR 5 million share buyback program. The quantum is funded from the company's excess reserves and represents the premium-to-book value that we have crystallized in 2024 through sales to individual purchasers and what we expect to crystallize over the next 12-15 months from the program. Turning now to slide eight, as mentioned, we recently exited the company's strategic review.
As part of this process, the committee members, along with our financial and real estate advisors, undertook rigorous market testing with capital markets and industry participants, and the board unanimously concluded that the sale of the company or its assets was highly unlikely to result in a maximization of shareholder value. The review also identified a number of initiatives that the board believes will drive shareholder value over the medium term, and as discussed on the previous slide, we are progressing well on these. Although we exited the strategic review on the 8th of August, strategy is part of the day job for myself and the executive team, and we continuously look at our strategy to ensure that it is aligned with current market conditions and is fit for purpose.
The board also continues to carefully review all strategic options available to the company as part of the normal course of our business. During the year, we also looked at all the elements that underpin our strategy to ensure that everything we do is aligned with delivering that strategy. Stepping through some of these specifics, we have refreshed our mission, vision, and values to ensure that they are fully aligned with our strategic pillars. These strategic pillars give us the platform to deliver on our strategic objectives, which in turn drive value creation for shareholders. Importantly, all of our senior leaders are orientated around these objectives and are therefore cohesively pulling together in order to maximize value creation across a consistent strategic framework.
We remain committed to leveraging our market-leading operating platform to drive operational performance and cost efficiencies through the business, whilst also focusing on generating ancillary revenue streams to create value for shareholders. At the same time, we ensure that we optimize our portfolio by recycling assets and investing that capital in a manner which is also value-enhancing for shareholders. All of this is executed through a lens of maintaining a strong balance sheet by managing our LTV through the cycle and, where appropriate, retaining flexibility to efficiently return surplus capital to shareholders. Along with this laser focus on the internal drivers of value and growth, we continue to advocate with government and policymakers for a balance in regulation. We do this both through direct engagement and through industry groups. Current rent regulation continues to negatively impact our business, and just as importantly, the supply of housing in Ireland in general.
I will return to this topic later in the presentation. Turning now to slide nine. This is quite a detailed slide, but we feel it's important that we are clear around our approach to maximizing value. In short, we have one of the highest quality and largest portfolios in the country. We are lucky to have some very experienced real estate experts in the company to consistently deliver sector-leading operational outcomes, and we have a leading technology platform which will continue to add value over the long term. I-RES is a totally unique business in the Irish market. There is no other solely residentially focused company in Ireland with a permanent capital base. There is also no other residential owner in Ireland, public or private, that is fully internally managed.
We do all our own property maintenance, leasing, revenue management, and operations internally, leading to significant cost efficiencies and savings for the business, while allowing us to uphold the highest level of service for our residents. This allows us to consistently deliver effectively full occupancy and almost 100% rent collection from our residents. Capitalizing that above-market occupancy and rent collection adds significantly to shareholder value. Furthermore, having all these teams internally allows us to amass a significant amount of knowledge and data, which makes us much more informed in our decision-making, drives better efficiency, gives us the ability to scale our business, and provides us with significant operating leverage. This operating model generates significant value to shareholders, both in the short term but particularly over the long term, as opportunities to leverage this capability present themselves. I'll now hand you over to Brian to talk you through the financials.
Thanks, Eddie, and good morning to everybody on the line. Moving to Slide 11, which provides a summary of our financial performance for the year. We are pleased to report an excellent performance for 2024. We have delivered across our most important financial and operational KPIs. Revenue, on a like-for-like basis, increased year-on-year by 1.7%, driven by organic rental income increases and enhanced ancillary revenue. NRI margin, we have been working hard to maintain our NRI margins despite embedded inflation and the effects of disposals. This has included initiatives right across the company in terms of cost management and revenue generation. We have delivered a net rental income NRI margin of 76.8% for 2024, with NRI margin in H2 incrementally improving compared to H1.
On a like-for-like basis, NRI margins were broadly in line with 2023, reflecting the impact of rigorous cost management initiatives in the period, as mentioned earlier by Eddie. Occupancy in the portfolio remained strong at 99.4% at December 2024, similar to December 2023. Collections also remained strong at over 99%, reflecting our continued focus on this area. The strong occupancy and revenue performance further underlines the resilient characteristics of the business. Adjusted EBITDA reduced by 5%, which reflects the impact of the asset recycling program undertaken in 2024, 66 units, and also the EUR 100 million asset disposal program undertaken primarily in the latter half of 2023. That disposal program resulted in a sale of 5% or 200 of our units. Financing costs reduced by 12.4% to EUR 23.4 million, reflecting both the deployment of disposal proceeds to reduce variable debt and the impact of a reducing global interest rate environment.
Non-recurring costs of EUR 3.4 million comprise shareholder activism, EUR 1.5 million, strategic review, EUR 1.1 million, and aborted transaction costs, EUR 0.8 million. As Eddie outlined, we achieved earnings growth of 1.4% for the year, with adjusted EPRA earnings of EUR 28.9 million and adjusted EPRA EPS of EUR 0.055 per share. Adjusted earnings, excluding fair value movements, grew 8.7% to EUR 30.5 million in 2024, reflecting the success of our ongoing asset recycling program in generating sales premium significantly ahead of book values. Profit on disposals of EUR 1.6 million was achieved and was primarily driven by the 21 individual unit sales previously discussed. In accordance with international financial reporting standards, the company's profits are stated after taking account of movements in the valuation of investment properties. At 31 December 2024, our independently led valuation process resulted in a reduction of EUR 33.7 million in the value of our assets between December 2023 and December 2024.
The change in the period was primarily due to expansion of yields in H1, partially offset by positive net rental growth. In the second half of the year, yields stabilized, resulting in like-for-like valuations remaining broadly in line with 30 June 2024. Following today's results, the board is proposing that a final dividend per share of EUR 0.022 be paid to shareholders, representing 85% of distributable earnings in line with our policy and Irish REIT legislation. Turning now to slide 12, which provides an overview of our investment properties valuations. Institutional real estate transaction activity in Ireland has remained muted in 2024, as prevailing macroeconomic conditions included a continuation of the elevated interest rate environment in the first half. This resulted in modest yield expansion in H1, with prime yields on residential assets expanding by over 100 basis points in Ireland in the two years to 30th of June 2024.
Moderating inflation and interest rate cuts in the second half of 2024 have resulted in the stabilization of yields. The H1 shift in yields resulted in our EPRA net initial yield increasing by 20 basis points to 5.1% at June 2024 and remaining there at the end of the year. Reflecting this movement, EPRA NTA per share decreased to EUR 1.265 as of December 2024, down from EUR 1.317 in December 2023. Moving to slide 13. Our capital structure and financial position remained very strong. Net LTV at 31 December 2024 was 44.4%, decreasing from 45.4% at 30th of June 2024, and comfortably below our debt covenants and the limits set by Irish REITs legislation. This decrease is due to the paydown of our higher cost debt through deployment of our 2024 asset disposal proceeds.
Our debt facilities are made up of a Revolving Credit Facility, R CF, of EUR 500 million and EUR 200 million in private placement notes. At the beginning of 2024, the company exercised its right to reduce the RCF facility size from EUR 600 million to EUR 500 million. This was possible following the successful completion of our EUR 100 million strategic asset disposal program during 2023. This initiative resulted in commitment fee savings of circa EUR 700,000 in 2024. The private placement notes have a fully fixed overall weighted average interest rate of 1.92%. The maturity of the notes is laddered over six, nine, and 11-year maturities, with the first repayment due in March 2027. The drawn debt facilities are predominantly fixed against interest rate volatility, with 85% of the debt fully fixed at an all-in interest cost of 3.27%.
The group has a weighted average drawn debt maturity of 2.3 years and no debt maturities before April 2026. Our average cost of interest for 2024 was 3.79%, compared with 3.85% in 2023. Turning now to Slide 14. We have an unrivaled residential portfolio of high-quality assets with strong sustainability credentials. As of 31 December 2024, the asset portfolio comprised of 3,668 apartments and houses in the Dublin area and well-diversified across locations that continue to experience significant demand. Our properties are modern, with an average age of 15.2 years, meaning they require low capital expenditures and are of a high sustainability standard. 92% of our portfolio comprises A, B, or C building energy ratings. We offer attractively priced mid-market accommodation in well-connected communities. Our portfolio average monthly rent is EUR 1,814 with almost 75% of units costing below EUR 2,000 a month.
Many of our apartments are priced at the same level as newly constructed government Cost Rental housing. We delivered exceptionally high occupancy during the period, reflecting the strong demand for our high-quality assets, as well as operational effectiveness in our leasing and turnovers. Inherent in our portfolio, a significant reversionary potential. According to our independent valuers, current rents across our portfolio are approximately 18% below market, with the number of assets in excess of 25% below market level. The scale of this reversion in the portfolio is evident in the chart on the top right-hand side of this slide, with 18% reversion equating to approximately EUR 18 million in annualized passing rent, representing the significant opportunity for future growth that exists. I will now hand you back to Eddie.
Thanks, Brian. Moving now to sustainability. Against the backdrop of a challenging regulatory landscape and in the midst of a leadership transition, the business continued to make progress on our ESG ambitions through environmental action and social impact. Our vision is to be Ireland's leading provider of rental housing, recognized for quality and value, delivering sustainable growth while being a great place to work and maximizing our contribution to the wider community. Our three ESG pillars of Operating Responsibly, Protecting the Environment, and Building Communities, support this vision and will continue to shape our efforts and guide our decision-making in 2025. Over the last couple of years, we've made significant progress in reducing both Scope 1 and 2 greenhouse gas emissions, including further reductions in 2024.
We have increased our disclosure efforts and promote transparency, as evidenced in 2024 by retaining gold-level EPRA sustainability status, increasing our GRESB rating from two to three stars, and increasing our CDP score from a C to a B rating. We also achieved an increase in our S&P Corporate Sustainability Assessment of over 20%. Most pleased with our progress to date, we are continuing to look for further improvements in these areas each year. We are also prioritizing the integration and well-being of our residents and the communities in which we operate. Through our app, we have seen further improvement in resident engagement levels and, consequently, the quality and speed of service that we're able to offer them. We have seen tremendous uptake of over 90% in our I-RES Living app.
This app not only improves the quality of service we can offer our residents, but it is integrated into our processes, allowing us to drive further operational efficiencies across the business, and we will continue to seek additional ways that the app can enhance our operational processes and resident interactions. We are also supporting local community groups and businesses, underscoring our commitment to community development, and finally, we are investing in our people through skills development, training programs, and learning opportunities to empower employees and enhance their capabilities. In our recently completed staff survey, we achieved exceptionally high engagement levels from our people, with a 92% participation rate and a 90% satisfaction level. This is exceptional for any company, and we take great pride in having such an engaged workforce. We will release our 2024 ESG Report in the coming months.
It will highlight the significant progress we are continuing to make against our three core strategic pillars, and I would encourage you to take a look at the report if you're interested in seeing the continuing progress that we make. Turning now to Slide 18, and I said earlier that I would return to the regulatory landscape. As many of you will know, regulation has been a consistent and key challenge for the residential sector over the last number of years, primarily driven by the introduction of rent caps. The current rent regulation structure remains the most inhibiting factor in our business. The 2% cap on rental increases is now driving up rent levels due to a lack of supply. There has also been a notable falloff in investment into the residential sector following the change in regulation to permit rent increases to the lower of HICP or 2%.
This lack of investment has naturally flowed through to lower completion numbers, as shown by the disappointing outturn in residential completions in 2024, which were lower than the previous year, and therefore placing further pressures on an already acute supply shortage in the Irish market. However, the recent elections have given a stable basis for change over the next five years. The new Programme for Government shows that the government recognizes the challenges facing the housing sector and also shows a willingness to implement positive changes. To be clear, we at I-RES, believe there is a place for rent regulation in the Irish market. However, we also believe that the current regulatory regime requires urgent revision and needs to be replaced with a balanced system that both protects renters but also encourages the necessary investment. We can have both. Many other jurisdictions do this successfully.
Over the last few weeks, there has been a building of positive momentum behind change. This is not about uncontrolled rent increases, but rather about ensuring a balance between rental growth and wage inflation and ensuring that operating costs don't increase at a significantly faster rate than rent levels, as they have been over the last number of years. Earlier this month, the newly elected Taoiseach, Micheál Martin, made a number of statements regarding the housing crisis and the impact that current rent regulations are having on the delivery of new supply. He said that the government will explore an alternative to Rent Pressure Zones, not abandoning rent regulation altogether between now and the end of the year.
He also correctly identified that what is needed most is stability in terms of the regulatory environment and commented that the new government's stance will be to encourage private sector investment into the market, recognizing that the state cannot reach its own targets on its own. These comments are very encouraging and reflect the messages that we, as a company and an industry, have been relaying to senior government officials and policymakers over the last number of years. We welcome the opportunity to continue our constructive engagement with the government and other relevant stakeholders and to push for positive change in the residential regulatory system. And finally, turning to Slide 20, the outlook for our business remains very positive. The demand for high-quality residential rental accommodation in Ireland is set to remain robust over the medium term, underpinning our revenues and business model.
The company has a strong balance sheet, LTVs within target ranges, and valuations stabilized. We have a high-quality portfolio, fully occupied, with excellent energy credentials, strong reversionary income, and values well below replacement cost. We provide operational excellence, maintaining a high and improving NRI margin, exceptional collection rates, efficient turnover times, and high tenant satisfaction. We have a market-leading platform, vertically integrated, fully internalized, and highly digitalized. All of these strong company attributes are set against the landscape of improving economic and market conditions. We have moderating inflation, reducing interest rates, stabilized valuations, increasing transactions, continued strong demand dynamics, and an improving sentiment amongst policymakers towards amending the current regulatory structure. With the long-term structural drivers of growth continuing to drive demand for rental accommodation and an improving economic landscape, the company remains well placed to deliver on its strategic objectives, to drive growth and deliver shareholder value.
I'm very confident that the company will achieve this over the coming years, and with that, I'd like to thank you for your attention, and we're now happy to take your questions.
Thank you. We will now start today's Q&A session. If you would like to ask a question, please press star followed by one on your telephone keypad, and if you wish to withdraw your question, then it is star followed by two. Our first question today comes from Colin Grant from Davy. Your line is now open. Please go ahead.
Yeah, thanks very much, and good morning, everybody, and thanks for doing the call. A couple of questions. Just firstly, in terms of your NRI margin, which increased in H2 2024 from H1, I'm very positive to see, given that you had some disposals during the period. I'm wondering if you could just give us a little bit more color around some of the cost management initiatives that you have in place that have supported that margin expansion in H2, and maybe some kind of outlook on where your net rental income margin, how that might look looking ahead into 2025 and beyond. And the second area is just to do with a point you've made in your slides around capital being recycled into retrofits, and you're getting an 8% yield on cost on those.
I'm just wondering if there's any more color you can give us on the strategy there in terms of how many units. You mentioned only 90% or 92% are already A to C BER rated, but how many units that could potentially take place, the time frames that could be involved, and just give us some color as to sort of what kind of upside might come from that strategy. Thank you.
Okay, maybe I'll just give something very quick on the NRI margin, and Brian can jump in after that, and then I'll go back to the retrofits. So thanks for the question, Colin. As you pointed out, NRI margin improved in the second half of the year, and I would say that that isn't one big thing. It's lots and lots of little things. So we have focused very strongly on our cost base over the year. From the disposal program, what we obviously mentioned, we have exited the Cork market. Those were amongst our lower performing units, and not because there's anything wrong with the Cork market, but we just didn't have scale in Cork, and we externally managed those as opposed to internally manage them, and consequently, the costs of running them were higher. So that had an impact on us.
We continually look at all of the operating contracts that we've had, and we have started to centralize, for want of a better word, some of the contracts, be it lift maintenance or landscaping, for example, where we are now doing larger and less contracts and getting better value for our economies of scale. So there's a whole range of different things that go into that. And as I said, you rightly point out, in the second half of the year, we showed an increase in our NRI margins over the first half, and I would expect to see that improvement continue in 2025. Brian, do you have any thoughts on that?
Yeah, absolutely, Eddie. And Colin, yeah, laser- focussed as Eddie said earlier on, lots and lots of small initiatives right across, right? Okay, waste management contracts, energy contracts, right? Okay. And look, that's to go and counteract the effect of, I referred to it earlier, the embedded inflation, right, which we have from 2022 and 2023. And also then, and this will give you a feel for the scale, right? Okay, the disposals in 2023 did have a big impact on our margin, and we had sort of indicated at the time that they were going to have a 0.8% negative impact. And we saw margins going from 77.3% to 76.5% in the first half, but working really hard in the second half, right, to go and recover that, right? Okay. And that is the objective of management and the operations teams, and indeed everybody, right?
Okay, very focused on that going into 2025.
I'll just talk briefly about the retrofits, Colin. So as we said, about 92% of our portfolio is already A and C rated, which means that significant capital investment. Moving those back to market, either actually we can't do the capital investment. There's no requirement because they are raters. They can't move seven steps. So there are a limited number of units. I would say it's under 100 at this point in time, where we have all of the necessary factors. And the necessary factors are the ability to move it seven steps, because that then allows us to return it to market. We also, it's a very comprehensive retrofit of a unit. We can't do that with a tenant in situ, so we have to wait until turnover. The average turnover in our business is about 14%.
It's in and around the same for the units that we would look to retrofit. So we would lay our hands on those units, anything over a three- to four-year time horizon. We may be able to accelerate it slightly by moving, asking residents to move from one unit to another, but it's an attractive return, but it's not something that we can do with a lot of our portfolio.
Okay, that's great. Thanks very much, Eddie and Brian.
Thanks, Colin.
Thanks, Colin.
Our next question today comes from Eleanor Frew from Barclays. Your line is now open. Please proceed.
Hi team, thank you very much for the presentation. A couple of questions. Firstly, given that valuation yields appear to be stabilizing, maybe if you could give us some more color about what you're seeing in the transaction market, what kind of buyers and sellers, if any, are out there at the moment, and have you seen any increase in activity at the start of this year? And second one, regulation. Are there any rough timelines we should have in our heads for looking out for any announcements on changes or review processes, or do you think it will be more ad hoc with the bigger announcements at the end of this year?
Okay, thank you. So just on the valuation piece, I guess there's probably a general sense out there that the market has bottomed out. There hasn't been a loss of activity. So we are starting to see now some more activity. A couple of one large transaction has come to the market, a couple of more transactions are being spoken about. There are guides which would support our valuation, which our valuations, which I think is important. So let's see what happens with that over the next couple of months.
Yeah, and Eleanor, obviously in the second half and Q4, Q3 of last year, we did see positive developments on the interest rate side, okay? So that should have been positive for activity, right? Okay, lower financing costs. But then that was all offset by people holding back because of the upcoming election, okay? So the election is now out of the way, right? Okay, obviously, right? Okay. So look, as Eddie said, some signs of stuff coming to the market now, right?
I think there would be an expectation alright amongst the market participants, brokers, that we will see an increase this year, maybe towards the middle of the second half of the year as opposed to straight away. Probably, like any market, depends on how the early transactions go. It's very much watch this space when it comes to activity. Just turning to the regulation piece, Eleanor, so there's obviously been a lot of discussion over the last number of weeks, never mind weeks, months. I don't think, so the regulations actually expire in December of this year. My expectation would be that we will see the amendments before the expiry, but not much before the expiry. I don't think they will be extended.
I think the government clearly have close to 12 months to look at the market and do their consultation, their analysis, everything else they have to do. So my expectation would be change would be towards the end of the year, second half at best.
Thanks very much, very clear.
Thanks, Eleanor.
Our final question today comes from Denis McGoldrick from Goodbody. Your line is now open. Please go ahead.
Good morning, Eddie and Brian, and thank you for the presentation and for taking my questions. Two, if I may, please. Just in relation to the ongoing sale of the portfolio of 315 units. So just interested in what your thinking is around the latest timelines for the completion of that. So you're saying you expect a minimum of 50 sales this year. You have 247 to go. Does that imply you're more in the five-year end of your previously guided three- to five-year timeline, or to what extent can that process be accelerated? And then secondly, just on the income and cost meeting initiatives. So they've been applied to 6% of the portfolio, and you expect an NRI margin increase of 8%-10% on that. To what extent could those initiatives be extended across the entire portfolio, or to what extent can that be replicated? Thank you.
Thanks, Dennis. Good morning. Thanks for the questions. So, just dealing with the 315, we had originally said three to five years because generally, the way we view it is we require turnover before we sell those units into the open market. We set a minimum of 50 for this year, and I think we're very pleased with the progress that we're making on that 50, as I mentioned, at the end of January, and we've had more progress since the end of January. We have 19 units in that pipeline. So, we would still see the timeline of three to five years being appropriate. Like all of these things, when you have a portfolio, there will probably be a small tail left at the end that doesn't behave the way the rest of the portfolio behaved.
We may need to figure out exit for that, but it'll be a small tail, and I would still expect us to still be able to deliver within that three- to five-year timeframe, and certainly not towards the latter piece of it for the vast majority of the 315 units. Look, we are very pleased with how it's going. I think that's the important point, and we will report again, obviously, at the half year, and that will give some more color to it. We have some ways of accelerating, and we do, where the units have been identified. We will talk to existing residents, and let's see does that bear some fruit as well.
So there are ways of accelerating, and we did speak about this before, where potentially we can also, similar to the retrofits, we may be able to offer residents alternative accommodation in units that we're not selling. So some of those acceleration initiatives are also starting to bear fruit. So look, we feel pretty good about it. And then in terms of the additional and ancillary income and costs that we talk about, and as you point out, we have done 6% of the portfolio. We would think in any given year we should be able to do around 8%-10% of the portfolio. I think that's probably what you should think about when we talk about those initiatives.
That's great. Thank you very much.
That concludes today's Q&A session. Thank you all for your participation. I'll now hand back over to Eddie Byrne for closing remarks.
Thank you. So I would just like to thank you all for taking the time to listen to this morning. I hope you found it informative, and I look forward to meeting many of the shareholders who were on today on the road over the next two weeks. Myself and Brian will be out and about. So thank you all.
Thanks, everybody.