REG-AEW UK REIT plc AEW UK REIT plc: Acquisition of Central Six Retail Park, Coventry

Aew UK ReitAnnouncement

08/11/2021 09:40

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   AEW UK REIT plc (AEWU)
   AEW UK REIT plc: Acquisition of Central Six Retail Park, Coventry

   08-Nov-2021 / 09:38 GMT/BST
   Dissemination of a Regulatory Announcement, transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

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   8 November 2021

                                        

                                AEW UK REIT Plc

                                        

                Acquisition of Central Six Retail Park, Coventry

                                        

   AEW UK  REIT plc  (LSE:  AEWU) ("AEWU"  or  the "Company") is  pleased  to
   announce the acquisition  of the  11.91 acre  Central Six  Retail Park  in
   Coventry for  a  purchase price  of  £16,411,000 /  £110  per sq  ft.  The
   purchase price  reflects  a  net  initial yield  of  circa  11%,  with  an
   anticipated  reversionary  yield  of  circa  12.5%.  The  acquisition   is
   accretive to the EPRA EPS and takes AEWU close to full investment,  having
   recently completed the sales  of two of its  industrial holdings in  South
   Kirkby and Basingstoke at prices 87% and 73% above their purchase  prices,
   respectively.  

   The acquisition demonstrates the Manager's view that there continue to  be
   interesting opportunities  to acquire  assets that  provide strong  income
   yields to support the ongoing  dividend payment, while also enhancing  the
   capital performance of its assets. The site presents opportunities to  add
   value through active  asset management by  renewing current tenancies  and
   securing new  tenants on  the park.  This purchase  will be  accretive  to
   AEWU's  income  return  and  it  is  anticipated  that  asset   management
   initiatives will result in NAV growth.

   The site  occupies a  strategic and  central location,  approximately  0.7
   miles away  from Coventry  city centre  and adjacent  to Coventry  Railway
   Station and the  Friargate Regeneration  area. The retail  park is  highly
   accessible and provides 148,765 sq ft of modern purpose-built retail space
   with parking for 635 cars.  The site cover is just  27%. Units are let  to
   household name retailers  including TK Maxx,  Next, Boots, Sports  Direct,
   Burger King  and  Poundland.  Coventry  has one  of  the  fastest  growing
   populations in  the UK  outside of  London. Between  2019 and  2024 it  is
   expected to grow by 1.25% per annum, ranking the city second out of 200 in
   the PROMIS Centres Retail Report. 1  1   Coventry was named the UK's  City
   of Culture 2021, which is estimated to generate an additional £80m for the
   local economy.

    

   The tenants at Central Six Retail Park have proven to be resilient  during
   the pandemic, with rent collection rates generally being strong.

    

   Alex Short, Portfolio Manager, AEW UK REIT plc, commented: "We are pleased
   to have  acquired Central  Six Retail  Park in  Coventry, which  has  been
   purchased for a  price that will  deliver an excellent  initial yield  and
   contribute immediately  to shareholder  returns. The  park offers  further
   opportunity to  manage the  assets  proactively to  enhance NAV  over  the
   longer term.  At present  the retail  warehouse sector  is providing  some
   interesting opportunities, often underpinned by alternative use value, and
   occupied by tenants that have shown resilience during the pandemic. We are
   pleased to add  this asset to  the portfolio and  will continue to  target
   acquisitions where we believe valuations offer the opportunity to  deliver
   both strong income and capital performance. The Company continues to judge
   each asset on its own specific  merits, rather than being entirely  sector
   driven in its purchasing strategy."

    

    

                 Valuation (as provided by Knight Frank as at 30 September
   Sector        2021, including sale of Wella Basingstoke plus subsequent
                 acquisition at purchase
                 price)                                      
                                         £ million                          %
   Industrial                               109.72                      50.31
   Office                                    39.95                      18.32
   Retail      -                             31.26                      14.33
   Warehousing
   Retail - High                             24.62                      11.29
   Street
   Other                                     12.55                       5.75
   Total                                     218.1                        100

    

    

                                        

                                        

    

   Enquiries                       
   AEW UK                          
   Alex Short                      2 alex.short@eu.aew.com
                                  +44(0) 20 7016 4848
                                   
   Nicki Gladstone                 3 nicki.gladstone-ext@eu.aew.com
                                  +44(0) 7711 401 021
   Company Secretary               
   Link Company Matters Limited   aewu.cosec@linkgroup.co.uk
                                  +44(0) 1392 477 500
                                   
   TB Cardew                       4 AEW@tbcardew.com
   Ed Orlebar                     + 44 (0) 7738 724 630
   Tania Wild                     +44 (0) 7425 536 903
   Lucas Bramwell                 +44 (0) 7939 694 437
                                   
   Liberum Capital                 
   Darren Vickers / Owen Matthews +44 (0) 20 3100 2000

    

    

    

    

    

    

    

   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  £15 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 UK Listing  Authority
   and admitted to trading on the Main Market of the London Stock Exchange on
   12 May 2015. 

    

    5 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 €75.4bn of assets under management as at 30 June 2021.  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  30
   June 2021, AEW Group managed €36.6bn of real estate assets on behalf of  a
   number of funds  and separate accounts  with over 440  staff located in  9
   offices. In  May  2019,  AEW  UK Investment  Management  LLP  was  awarded
   Property Manager  of the  Year  at the  Pensions and  Investment  Provider
   Awards. 

    6 www.aewuk.co.uk

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    7  1  PROMIS: The UK  Property Market Information  Service (PROMIS) is  a
   key  source  of  comprehensive  and  independent  analysis  of  town-level
   property markets. Since 1982, PROMIS has provided up-to-date,  consistent,
   and  independent  town-level  property  analysis  to  support  investment,
   valuation, development and consultancy.

    

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   ISIN:           GB00BWD24154
   Category Code:  MSCH
   TIDM:           AEWU
   LEI Code:       21380073LDXHV2LP5K50
   OAM Categories: 3.1. Additional regulated information required to be
                   disclosed under the laws of a Member State
   Sequence No.:   126254
   EQS News ID:    1246929


    
   End of Announcement EQS News Service

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