Custodian REIT plc (CREI) Custodian REIT plc : Custodian REIT sells industrial unit for GBP8.5 million, 73% ahead of valuation 03-Aug-2022 / 07:00 GMT/BST Dissemination of a Regulatory Announcement that contains inside information in accordance with the Market Abuse Regulation (MAR), transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.

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3 August 2022

Custodian REIT plc

("Custodian REIT" or the "Company")

Custodian REIT sells industrial unit for GBP8.5 million, 73% ahead of valuation

Custodian REIT (LSE: CREI), the UK property investment company focused on smaller lot-sized regional property, is pleased to announce the disposal of an industrial unit in Milton Keynes for GBP8.5 million at a 73% premium to its 31 March 2022 valuation.

Custodian REIT acquired the 44,187 sq ft warehouse and distribution unit in January 2015 for GBP2.1 million and subsequently invested a further GBP0.9 million to fully refurbish the property. This refurbishment included re-cladding the exterior, replacing the roof, restoring the yard and renovating the interior which in aggregate improved the property's energy performance certificate ("EPC") rating from 'E' to 'C'. As a result the property was let at a higher rent to Saint Gobain Building Distribution for six years before a tenant break option was exercised in June 2022. The sale of the unit to a special purchaser was then negotiated which required the property with vacant possession.

This disposal decreases the industrial weighting by valuation1 within the Company's highly diversified portfolio of 164 properties to 47%, with the balance comprising 21% retail warehouse, 13% office, 12% other and 7% high street retail, all of which are in strong economic areas across the UK.

Commenting on the disposal, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company's external fund manager), said: "We acquired this property having clearly identified an opportunity to create value by investing in the asset and bringing it up to modern standards. As a result we were able to let the property promptly and generate a healthy and growing level of income during our seven years of ownership. When the tenant exercised its break option we took the opportunistic decision to dispose of the property to a special purchaser. This sale has allowed us to crystallise a significant profit for shareholders and further demonstrates the benefits of a smaller regional property strategy, where in certain circumstances the vacant possession value fully supports and sometimes exceeds the investment value."

1 Portfolio weighting by income: industrial 38%, retail warehouse 24%, office 16%, 11% high street and 11% other.

- Ends -

For further information, please contact:

Custodian Capital Limited 
Richard Shepherd-Cross / Ed Moore / Ian Mattioli MBE Tel: +44 (0)116 240 8740 
                                                     www.custodiancapital.com 
Numis Securities Limited 
Hugh Jonathan / Nathan Brown  Tel: +44 (0)20 7260 1000 
                              www.numiscorp.com 
FTI Consulting 
Richard Sunderland / Ellie Sweeney  Tel: +44 (0)20 3727 1000 
                                    custodianreit@fticonsulting.com

Notes to Editors

Custodian REIT plc is a UK real estate investment trust, listed on the main market of the London Stock Exchange. Its portfolio comprises properties predominantly let to institutional grade tenants on long leases throughout the UK and is principally characterised by properties with individual values of less than GBP10 million at acquisition.

The Company offers investors the opportunity to access a diversified portfolio of UK commercial real estate through a closed-ended fund. By targeting sub GBP10 million lot size, regional properties, the Company intends to provide investors with an attractive level of income with the potential for capital growth.

Custodian Capital Limited is the discretionary investment manager of the Company.

For more information visit www.custodianreit.com and www.custodiancapital.com.

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ISIN:          GB00BJFLFT45 
Category Code: IRS 
TIDM:          CREI 
LEI Code:      2138001BOD1J5XK1CX76 
Sequence No.:  178815 
EQS News ID:   1411673 
 
End of Announcement  EQS News Service 
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