TIDMLXI
RNS Number : 5132E
LXI REIT PLC
12 February 2018
12 February 2018
LXi REIT plc
(the "Company" or "LXI REIT")
ACQUISITION, FULL DEPLOYMENT OF EQUITY AND DEBT AND PORTFOLIO
UPDATE
The Board of LXi REIT plc (ticker: LXI) is pleased to announce
that the Company has exchanged contracts on the acquisition of the
freehold interest in a portfolio of regulated long-let supported
living properties located in Colchester, Essex (74%), Birmingham
(17%) and Dover, Kent (9%) (the "Portfolio").
The purchase price for the Portfolio is GBP6.2 million,
reflecting a net initial yield of 6.0% (net of acquisition costs to
the Company).
Each property is immediately income producing and has been let
on a new 25-year lease, with no tenant break, to a specialist
Housing Association, which is a Registered Provider of social
housing. The Registered Provider is regulated by the Regulator of
Social Housing and receives its funding for the rent payments
directly from the relevant local authority.
Each lease is subject to annual upward-only rent reviews
index-linked to the Consumer Prices Index and the Registered
Provider is responsible for the costs of repair, maintenance,
insurance and outgoings.
The properties in the Portfolio comprise specialist, high
quality supported living homes for individuals with physical and/or
mental disabilities or other care needs.
The acquisition is being funded using the proceeds of the
Company's new 11.5-year loan facility secured from Scottish Widows
in December 2017 at a fixed rate of 2.85% per annum.
Portfolio update - full deployment of equity and debt
The Company has now fully deployed its net equity and debt
capital, totalling GBP273 million (excluding acquisition costs).
Across the Company's portfolio, the headline statistics are:
-- Long weighted average unexpired lease term to first break of 24 years
-- Attractive 6.03% average Net Initial Property Yield
-- 313 bps spread between the 6.03% Net Initial Property Yield
and the Company's 2.90% per annum fully fixed average cost of
debt
-- Average debt maturity of 11.5 years
-- 91% index-linked rent reviews, 6% fixed rental uplifts and 3% open market rent reviews
-- 88 properties, with significant geographic diversification across the United Kingdom
-- 100% let or pre-let
-- 25 strong tenants, including Aldi, Costa Coffee, General
Electric, Home Bargains, Lidl, Motorpoint, Mears Group, Premier
Inn, The Priory Group, Prime Life, Q-Park, QHotels, SIG, Specialist
Housing Associations, Starbucks, Stobart Group and Travelodge
-- Nine robust property sectors: supported living (24%), hotels
(23%), care homes (19%), industrial (9%), student (7%), car parks
(7%), discount retail (6%), leisure (3%) and automotive (2%)
-- Good mix of forward funding, forward commitment and built asset structures
Simon Lee, Partner of LXi REIT Advisors Limited, commented:
"The Company has continued to perform strongly since its IPO in
February 2017, effectively delivering on our stated objectives and
in many areas surpassing our original expectations. The Company's
secure, diversified and growing index-linked income stream as well
as attractive capital appreciation from across our long-let
portfolio is delivering attractive returns to our shareholders.
We are well placed with an excellent platform for growth and we
look forward to driving further value for our shareholders
throughout this financial year and for the long term."
The Company's LEI is: 2138008YZGXOKAXQVI45
FOR FURTHER INFORMATION, PLEASE CONTACT:
LXI REIT Advisors Limited Via Newgate Communications
John White (Partner, Fund
Manager)
Simon Lee (Partner, Fund Manager)
----------------------------------- ---------------------------------
Peel Hunt LLP Tel: 020 7418 8900
Luke Simpson
----------------------------------- ---------------------------------
Newgate Communications (PR Tel: 020 7680 6550
Adviser) Email: lxireit@newgatecomms.com
James Benjamin
Anna Geffert
Leena Patel
----------------------------------- ---------------------------------
NOTES:
The Company invests in UK commercial property assets let, or
pre-let, on very long (typically 20 to 30 years to expiry or first
break), inflation-linked leases to a wide range of strong tenant
covenants across a diverse range of property sectors.
The Company may invest in fixed-price forward funded
developments, provided they are pre-let to an acceptable tenant and
full planning permission is in place. The Company will not
undertake any direct development activity nor assume direct
development risk.
The Company is targeting a minimum annual dividend of 5 pence
per ordinary share, starting from the financial period commencing 1
April 2018, with the potential to grow the dividend in absolute
terms through upward-only inflation-protected long-term lease
agreements, and is targeting a net total shareholder return of 8
per cent. plus per annum over the medium term(1) .
The Company, a real estate investment trust ("REIT")
incorporated in England and Wales, is listed on the premium listing
segment of the Official List of the UK Listing Authority and was
admitted to trading on the main market for listed securities of the
London Stock Exchange in February 2017.
Further information on the Company is available at
www.lxireit.com
Note 1: these are targets only and not a profit forecast and
there can be no assurance that they will be met.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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