LXB Retail Properties Plc Disposals at Stafford & further lettings (1469A)
December 22 2017 - 2:00AM
UK Regulatory
TIDMLXB
RNS Number : 1469A
LXB Retail Properties Plc
22 December 2017
22 December 2017
LXB RETAIL PROPERTIES PLC
(the "Company" or the "Group")
Disposal of investments at Stafford and further lettings at
Rushden Lakes and Sutton
LXB Retail Properties Plc, the Jersey resident closed-ended real
estate investment company focused on edge of town and out of town
retail assets, is pleased to report that it has exchanged contracts
for the disposal of its two remaining investments at Stafford and
to update on further lettings at Rushden Lakes and Sutton.
On 21 December 2017, the Group exchanged contracts for the sale
of its retail investment at Riverside, Stafford to Pavilion
Property Trustees Limited and Pavilion Trustees Limited in their
capacity as Joint Trustees of the Gelos Property Unit Trust,
managed by Legal & General. The property is let to 13
retailers: M&S, Primark, New Look, River Island, Outfit, Zizzi,
JD Sports, Greggs, Vision Express, H&M, Costa, Acapella and
Save our Soles. The sale is conditional on the provision of
warranties and completion is expected to occur on or about 23
January 2018 when cash proceeds of GBP35.9m will be received. This
reflects a headline price of GBP36.8m, net of deductions for
letting packages in relation to three vacant units and unexpired
rent free periods in relation to two units. Completion of the
disposal will release cash of GBP10.2m after repayment of the
GBP25.7m of bank borrowings which are secured on the investment.
Details of the Board's proposals for use of the net proceeds will
follow when the transaction has completed.
The sale price reflects a net yield of 6.5% for the Group's
freehold interest.
On the same date the Group exchanged contracts for the forward
sale of the leisure investment at Bridge Street, Stafford to Legal
& General Leisure Fund Trustee Limited and Legal & General
Property Partners (Leisure) Limited. This development will comprise
approximately 53,600 sq ft and will be anchored by a six screen
Odeon cinema with seven restaurant units, two of which are open and
let to Nando's and Frankie & Benny's. The building construction
is scheduled for completion in the summer/early autumn of 2018. The
initial purchase price will be paid on completion of the lease to
Odeon and will be based on lettings in place at that time on agreed
yields and letting criteria. Further payments will be made as and
when future lettings are completed. Assuming no further lettings
are completed prior to completion of the lease to Odeon, this will
give an estimated initial purchase price of GBP8.9m, subject to the
deduction of rent concessions, outstanding rent free periods and
outstanding capital contributions. The construction is supported by
a GBP6.4m development finance facility with RBS which will be
approximately GBP4.6m drawn when the sale completes. Hence, the
Group anticipates generating an initial cash receipt of
approximately GBP4.3m at completion subject to the deductions noted
above. The Group estimates that letting the remaining 5 units could
result in subsequent payments totalling up to approximately GBP4.8m
though it should be noted that this estimate is subject to the
usual variables.
The agreement reflects a net yield of 5.25% for the cinema and
6% on the restaurant units.
The Group can also report news of further lettings at Rushden
Lakes. The letting to Robert Goddard, which was reported as being
in solicitors' hands in the last update on 5 December 2017, has now
exchanged, subject to planning for a widening of the use to allow
further fashion and footwear sales to Terrace A. Robert Goddard
will amalgamate the unit with its existing store to provide an
enhanced offer, following positive sales in recent months. This
letting means Phase 1 is now 100% let.
On Phase 3 at Rushden, contracts have also been exchanged with
Decathlon to take a 14,000 sq ft store (7,000 sq ft at ground and
7,000 sq ft at mezzanine level). The letting means a single unit of
6,000 sq ft (which could be split) remains to be let on Phase 3.
Practical Completion of Phase 3 is due for June 2018.
At Sutton, contracts have been exchanged with The Gym Group to
take a unit of 12,206 sq ft, subject to a change of use to allow
for gym use. Once complete, a final unit of 1,313 sq ft remains to
be let. Terms have been agreed with a retailer for this final
unit.
Commenting on these developments, Tim Walton, CEO of LXB Adviser
LLP, said:-
'The Group continues to make good progress with its remaining
investments. The sale of Riverside and Bridge Street at Stafford
represents a further significant step in effecting an orderly
disposal of the Group's remaining assets and once the sale of the
Leisure element is completed, concludes the Group's activities in
Stafford. The lettings progress at Rushden and Sutton bring us
closer to realising the value in these investments.'
For further information please contact:
LXB Adviser LLP Tel: 020 7432 7900
Tim Walton, CEO
Brendan O'Grady, FD
J.P. Morgan Cazenove (NOMAD) Tel: 020 7742 4000
Bronson Albery/Paul Hewlett
Buchanan Tel: 020 7466 5000
Charles Ryland/Victoria Hayns/Patrick Hanrahan
This information is provided by RNS
The company news service from the London Stock Exchange
END
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