AEW UK REIT PLC Acquisition of high-yielding retail warehouse unit (2225U)
March 27 2023 - 2:00AM
UK Regulatory
TIDMAEWU
RNS Number : 2225U
AEW UK REIT PLC
27 March 2023
27 March 2023
AEW UK REIT plc
Acquisition of high yielding retail warehousing unit in
Preston
AEW UK REIT plc (LSE: AEWU) ("AEWU" or the "Company") is pleased
to announce that it has completed the purchase of a freehold solus
retail warehousing unit in Bamber Bridge, Preston for GBP6,450,000,
reflecting a low capital value of GBP110 per sq ft and an
attractive net initial yield of 9.5%.
The 58,696 sq ft unit is single-let to Matalan Retail Limited
and has another 9.2 years left on the lease. Matalan is known to
trade strongly from the location, with the store being one of its
top 10 performers, as well as being the retailer's first ever store
in the U.K. The lease benefits from a 2027 rent review to the
higher of open market value, or 2.5% per annum compounded,
resulting in a minimum reversionary yield of 10.7%.
The site totals 4.39 acres, providing a low site cover of 30%.
It is well located on Cuerden Way which connects to the A6, half a
mile from Junction 1 of the M65. Neighbouring tenants include Aldi
and Sainsburys to the south, with predominantly industrial uses to
the north. There is the potential to repurpose the unit for trade
counter or industrial use, and to extend the accommodation, subject
to planning, if required in future.
In January, Matalan announced the completion of a refinancing,
reducing its gross debt by 43% from GBP593 million to GBP336
million. The new debt facility will mature in 2027. The refinancing
also provides GBP100 million for business growth over the next
three years, with a return to profitability anticipated in FY
2024.
Commenting on the purchase, Laura Elkin, Portfolio Manager of
AEW UK REIT said : "We are pleased to have purchased this retail
warehousing unit that provides a very attractive day one yield that
is set to increase at review in the future. Our due diligence has
shown that Matalan trades well from the location, giving us
confidence in its continued occupation, and in the stability of the
income stream. As we look to return the portfolio to full
investment, we continue to analyse an interesting pipeline of
potential acquisitions, and expect to make further purchase
announcements in the coming months."
ENDS
Enquiries
AEW UK
Laura Elkin laura.elkin@eu.aew.com
+44(0) 7917 058 337
Henry Butt henry.butt@eu.aew.com
+44(0) 7920 499 076
Nicki Gladstone nicki.gladstone-ext@eu.aew.com
+44(0) 7711 401 021
Company Secretary
Link Company Matters Limited aewu.cosec@linkgroup.co.uk
+44(0) 7548773155
TB Cardew AEW@tbcardew.com
Ed Orlebar +44 (0) 7738 724 630
Tania Wild +44 (0) 7425 536 903
Henry Crane +44 (0)7918 207157
Liberum Capital
Darren Vickers / Owen Matthews +44 (0) 20 3100 2222
Notes to Editors
About AEW UK REIT
AEW UK REIT plc (LSE: AEWU) aims to deliver an attractive total
return to shareholders by investing predominantly in smaller
commercial properties (typically less than GBP15 million), on
shorter occupational leases in strong commercial locations across
the United Kingdom. The Company is currently invested in office,
retail, industrial and leisure assets, with a focus on active asset
management, repositioning the properties and improving the quality
of income streams. AEWU is currently paying an annualised dividend
of 8p per share.
The Company was listed on the Official List of the Financial
Conduct Authority and admitted to trading on the
Main Market of the London Stock Exchange on 12 May 2015. www.aewukreit.com
LEI: 21380073LDXHV2LP5K50
About AEW UK Investment Management LLP
AEW UK Investment Management LLP employs a well-resourced team
comprising 29 individuals covering investment, asset management,
operations and strategy. It is part of AEW Group, one of the
world's largest real estate managers, with EUR84.9bn of assets
under management as at 31 December 2022. AEW Group comprises AEW SA
and AEW Capital Management L.P., a U.S. registered investment
manager and their respective subsidiaries. In Europe, as at 31
December 2022, AEW Group managed EUR38.5bn of real estate assets on
behalf of a number of funds and separate accounts with over 470
staff located in 10 locations.
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END
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