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Regional REIT Ltd.

06/07/2019 | Press release | Distributed by Public on 06/07/2019 00:19

Attractive Disposal of Industrial Asset

7 June 2019

REGIONAL REIT Limited

('Regional REIT', 'the Group' or 'the Company')

Attractive Disposal of Industrial Asset

Regional REIT Limited (LSE: RGL), the regional real estate investment specialists, today announces thatLondon and Scottish Property Investment Management (LSPIM) on behalf of Regional REIT, has contracted to sell Tokenspire Business Park in Beverley for £11.1 million. The sale reflects a net initial yield of 7.0%. The sale price of £11.1 million represents an uplift of 30.6% to the acquisition price.

The industrial estate which extends to over 24 acres and consists of 322,211 sq. ft. of commercial space was purchased in March 2016 for £8.5 million. Since acquisition, the asset manager increased occupancy from 73.8% to 94.3%, decreasing EPRA vacancy from 26.2% to 5.7%. Simultaneously, rental income was increased to c. £829k pa, an uplift of 24% since acquisition. Key tenants include: QDOS Entertainment Limited, Sargent Electrical Services Limited and TAPCO Europe Limited. LSPIM's completed its business plan by undertaking much needed improvements to the estate's infrastructure, resulting in attracting new tenants reducing void periods, assisting in retaining existing tenants, increasing income and improving the value of the property substantially. All this was achieved well within the 5-year business plan period.

The LSPIM active management approach resulted in a significant increase in the number of tenants within the estate, substantially increasing occupancy.

Stephen Inglis, Chief Executive Officer of London & Scottish Property Investment Management, the Asset Manager, commented on the sale:

'This is a further example of achieving excellent results by utilising our unique management platform to undertake a pre-agreed business plan. This has not only achieved increased rental income but also improved the capital value of the asset. We have maximised shareholder returns by selling an asset we have completed the business plan on into a competitive attractive market for multi-let industrial properties.

We have a very substantial pipeline of acquisition opportunities and we will be recycling the proceeds of this sale into assets offering asset management initiatives, rental growth potential and thus higher future returns'.

- ENDS -

Enquiries:

Regional REIT Limited

Toscafund Asset Management

Tel: +44 (0) 20 7845 6100

Investment Manager to the Group

Adam Dickinson, Investor Relations, Regional REIT Limited

London & Scottish Property Investment Management

Tel: +44 (0) 141 248 4155

Asset Manager to the Group

Stephen Inglis

Buchanan Communications

Tel: +44 (0) 20 7466 5000

Financial PR

[email protected]

Charles Ryland / Victoria Hayns / Henry Wilson

About Regional REIT

Regional REIT Limited ('Regional REIT' or the 'Company') and its subsidiaries (the 'Group') is a United Kingdom ('UK') based real estate investment trust that launched in November 2015. It is managed by London & Scottish Property Investment Management Limited, the Asset Manager, and Toscafund Asset Management LLP, the Investment Manager.

Regional REIT's commercial property portfolio is comprised wholly of income producing UK assets and comprises, predominantly, offices and industrial units located in the regional centres outside of the M25 motorway. The portfolio is highly diversified, with 150 properties, 1,192 units and 874 tenants as at 31 December 2018, with a valuation of £718.4m.

Regional REIT pursues its investment objective by investing in, actively managing and disposing of regional core and core plus property assets. It aims to deliver an attractive total return to its Shareholders, targeting greater than 10% per annum, with a strong focus on income supported by additional capital growth prospects.

The Company's shares were admitted to the Official List of the UK's Financial Conduct Authority and to trading on the London Stock Exchange on 6 November 2015. For more information, please visit the Group's website at www.regionalreit.com.

Cautionary Statement

This document has been prepared solely to provide additional information to Shareholders to assess the Group's performance in relation to its operations and growth potential. The document should not be relied upon by any other party or for any other reason. Any forward looking statements made in this document are done so by the Directors in good faith based on the information available to them up to the time of their approval of this document. However, such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.

ESMA Legal Entity Identifier ('LEI'): (549300D8G4NKLRIKBX73)