REG - Regional REIT Ltd - Q1 2026 Trading Update & Dividend Declaration

Regional REITAnnouncement

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RNS Number : 7985E  Regional REIT Limited  19 May 2026

19 May 2026

REGIONAL REIT Limited

("Regional REIT", the "Group" or the "Company")

Q1 2026 Trading Update & Dividend Declaration

 

Regional REIT Limited (LSE: RGL), the regional commercial property specialist,
announces the following trading update for the period from 1 January 2026 to
31 March 2026 and a dividend declaration for the first quarter of 2025 of 2.0
pence per share.

 

Stephen Inglis, Head of ESR Europe LSPIM Ltd., Investment Adviser commented:

 

"Market conditions remain challenging, but we continue to deliver on our
repositioning strategy, executing targeted disposals to strengthen the balance
sheet while further improving the quality of our portfolio via our capex
programme.

 

During Q1 2026, we undertook six sales generating proceeds of £12.6m, with a
further three disposals totalling £2.5m completed post quarter end, all were
close to their 31 December 2025 valuations and in aggregate c. 90% vacant.
These disposals were largely from the sales segment of the portfolio where
refurbishment would not have generated sufficient returns on the capital
deployed. The LTV was further reduced at the end of Q1 2026 to 39.4% (2025:
40.4%).

 

The company completed 26 new lettings and renewals in the quarter, adding
£1.1m to the rent roll. These lettings were secured at 9.8% above ERV,
building on the 9.0% above ERV delivered in Q4 2025, underscoring rental
growth created by continued demand for well-located, high-quality space and
the effectiveness of our active asset improvement plan.

 

The increase in rents being achieved is indicative of our view in respect of
the structural supply and demand imbalance in the provision of high quality
and well-located regional office space that conform to EPC A and B, and this
will become increasingly evident.

 

Our portfolio is currently well positioned with 61.1% already EPC B or better.
Grade A vacancy across key UK regional markets remains tight at c.3-5%, with a
constrained development pipeline and best‑in‑class space accounting for
the majority of leasing activity*. This dynamic continues to support a broader
'flight to quality' and underpins our medium-term outlook."

 

* Knight Frank Office Market Annual Review 2025

 

Portfolio update

·    110 properties, 1,075 units and 653 tenants, totalling c.£543.1m**
of gross property assets value (31 December 2025: £555.2m)

·    26 lettings to new tenants and renewals/regears in the period across
113,885 sq ft delivering £1.1m of annualised rental income, an uplift of 9.8%
against ERV

·    Rent roll of £49.8m (31 December 2025: £50.4m); ERV £75.0m (31
December 2025: £77.0m)

·    EPRA Occupancy for the Core segment portfolio 87.0% (31 December
2025: 86.5%) - reflecting stable Core occupancy

·    EPRA Occupancy (by ERV) 75.5% (31 December 2025: 75.9%); 31 March
2026 like-for-like 75.6% versus 31 March 2025 78.9%

·    Total rent collection for the quarter as at 15 May 2026 98.5%
compared with 97.9% for the equivalent period in 2025

·    Post quarter end a further 7 new lettings and renewals/regears have
been achieved across 50,828 sq ft providing £0.9m of annualised rental
income, at 3.0% above ERV

 

Maintaining balance sheet discipline while pursuing updated strategy

·    Disposals in the period amounted to £12.6m (before costs) (2
properties and 4-part sales), reflecting a net initial yield of 4.0%

o Post quarter end, a further 1 disposal and 2-part sales completed totalling
£2.5m (before costs).

o The current disposal programme comprises of 36 sales totalling c. £89.5m,
though not all are expected to complete in 2026

·    Net capital expenditure £0.8m (Full year 2025: £11.8m) - continued
focus upon the capital expenditure programme

·    Cash and cash equivalent balances £40.3m (31 December 2025: £37.7m)

·    Net loan-to-value ratio reduced to c. 39.4%(**) (31 December 2025:
40.4%)

·    Gross borrowings £254.5m (31 December 2025: £266.2m)

·    Group cost of debt (incl. hedging) 3.4% pa (31 December 2025: 3.3%
pa)

 

**Gross property assets value based upon Colliers International Property
Consultants Ltd. valuations as at 31 December 2025, adjusted for subsequent
acquisitions, disposals and capital expenditure in the period.

 

Portfolio strategy update

As previously announced, the portfolio has been segmented into four strategic
categories:

 

 Segment        £m     Portfolio (%)  EPRA Occupancy (%)
 Core           348.5  64.2           87.0
 Capex to Core  103.3  19.0           61.3
 Value Add      53.8   9.9            46.3
 Sales          37.5   6.9            60.1

 

Table may not sum due to rounding.

 

·    Core - well positioned to deliver sustainable long-term income

·    Capex to Core - targeted investment to upgrade assets to secure
lettings

·    Value Add - assets with potential for repositioning and planning
gains

·    Sales - assets targeted for disposal programme

 

Q1 2026 Dividend Declaration

The Company declares that it will pay a dividend of 2.0 pence per share
("pps") for the period 1 January 2026 to 31 March 2026, (1 January 2025 to 31
March 2025: 2.50pps). The entire dividend will be paid as a REIT property
income distribution ("PID").

 

Shareholders have the option to invest their dividend in a Dividend
Reinvestment Plan ("DRIP"), and more details can be found on the Company's
website
https://www.regionalreit.com/investors/investors-dividend/dividend-reinvestment-plan
(https://protect.checkpoint.com/v2/r02/___https:/www.regionalreit.com/investors/investors-dividend/dividend-reinvestment-plan___.YXAxZTpzaG9yZWNhcDpjOm9mZmljZTM2NV9lbWFpbHNfYXR0YWNobWVudDo1NTE4MWFiYTNhMDdhMjIzMTY0YzRiMzNkNGMxYzFmMDo3OmM5MTg6NjRmMGE5OGZkMDUzYTI3MzM2ZTA5Y2JkM2Y2ODQyNjkwMjViZjIxOWJiNGUzZGUzY2U2NGUzOGI1ZjdlYWQyZTpwOkY6Tg)
.

 

The key dates relating to this dividend are:

 

 Ex-dividend date            28 May 2026
 Record date                 29 May 2026
 Last day for DRIP election  19 June 2026
 Payment date                10 July 2026

 

The level of future payments of dividends will be determined by the Board
having regard to, among other factors, the financial position and performance
of the Group at the relevant time, UK REIT requirements, the interest of
shareholders and the long-term future of the Company.

 

Forthcoming Events

 

 19 May 2026       Annual General Meeting
 8 September 2026  Interim Results Announcement
 12 November 2026  Q3 2026 Trading Update

 

Note: All dates are provisional and subject to change.

 

- ENDS -

 

Enquiries:

 

 Regional REIT Limited
 Press enquiries through FTI Consulting

 ESR Europe LSPIM Ltd.
 Investment Adviser to the Group
 Adam Dickinson, Investor Relations, Regional REIT Ltd.  Tel: +44 (0) 203 831 9776

 Stephen Inglis, Head of ESR Europe LSPIM Ltd.           Tel: +44 (0) 141 248 4155

 FTI Consulting
 Financial Communications                                Tel: +44 (0)20 3727 1000
 Dido Laurimore, Giles Barrie                            RegionalREIT@fticonsulting.com (mailto:RegionalREIT@fticonsulting.com)

 

About Regional REIT

 

Regional REIT Limited ("Regional REIT" or the "Company") and its
subsidiaries (the "Group") is a United Kingdom ("UK") based real estate
investment trust that launched in November 2015. It is managed by ESR Europe
LSPIM Limited, the Asset Manager, and ESR Europe Private Markets Limited, the
Investment Adviser.

 

Regional REIT's commercial property portfolio is comprised wholly of income
producing UK commercial assets, located in the regional centres outside of
the M25 motorway. The portfolio is geographically diversified, with 110
properties, 1,075 units and 653 tenants as at 31 March 2026, with a valuation
of c.£543.1m.

 

Regional REIT pursues its investment objective by investing in, actively
managing and disposing of regional Core and Core Plus Property assets. It aims
to deliver an attractive total return to its Shareholders, targeting greater
than 10% per annum, with a strong focus on income supported by additional
capital growth prospects.

 

The Company's shares were admitted to the Official List of
the UK's Financial Conduct Authority and to trading on the London Stock
Exchange on 6 November 2015. For more information, please visit the Group's
website at www.regionalreit.com
(https://protect.checkpoint.com/v2/r02/___http:/www.regionalreit.com/___.YXAxZTpzaG9yZWNhcDpjOm9mZmljZTM2NV9lbWFpbHNfYXR0YWNobWVudDo1NTE4MWFiYTNhMDdhMjIzMTY0YzRiMzNkNGMxYzFmMDo3OmE3NmI6ZGI3ZDdlMzg0OTZlY2ZhNjdlY2VjNDUyNDNmMDU1ZGNkNzhjNGI4OWZkODAxOTNjODVjOGY3YWMwODcxNzY2OTpwOkY6Tg)
.

 

LEI: 549300D8G4NKLRIKBX73

 

 

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