Sale of high-street retail asset in Portsmouth

AEW UK REIT PLC

09 October 2023

 

09 October 2023

AEW UK REIT plc

Sale of high-street retail asset in Portsmouth

AEW UK REIT plc (LSE: AEWU) ("AEWU" or the "Company") is pleased to announce that it has completed the sale of its freehold high-street retail holding at 208-220 Commercial Road and 7-13 Crasswell Street, Portsmouth, for £3,900,000, reflecting a net initial yield of 9.9% and a capital value of £251 per sq ft. A sale at this price reflects a circa 22% premium to the 30 June 2023 valuation of £3,200,000.    

Following the completion of two new lettings to Kokoro and Specsavers earlier this year, the property is now fully let. This, coupled with the risk of the main tenant, Nationwide Building Society ("Nationwide"), being significantly overrented, prompted the decision to sell. The value of the asset is likely to deteriorate as Nationwide's lease becomes shorter, with the threat of the tenant leaving on expiry in 2029 creating the possibility of a long-term void.    

Commenting on the sale, Laura Elkin, Portfolio Manager of AEW UK REIT said: "We are pleased to have sold this holding for a healthy premium to valuation, having completed the asset management strategy, and therefore maximised value. Going forward, the asset presents a potential risk to the Company's shareholders, which further justifies a sale at this point in time. The Company's focus for the deployment of capital continues to be on the consideration of further accretive investment opportunities, alongside re-investment into the existing portfolio where capex is needed in order to drive future performance gains".

ENDS

Enquiries
AEW UK
Laura Elkin	[e-mail]
	[phone]
Henry Butt	[e-mail]
	[phone]
Nicki Gladstone	[e-mail]
	[phone]
Company Secretary
Link Company Matters Limited	[e-mail]
	[phone]
TB Cardew	[e-mail]
Ed Orlebar	[phone]
Tania Wild	[phone]
Henry Crane	[phone]
Liberum Capital
Darren Vickers / Owen Matthews	[phone]

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 Financial Conduct Authority and admitted to trading on the Main Market of the London Stock Exchange on 12 May 2015. 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 €84.9bn of assets under management as at 31 December 2022. 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 31 December 2022, AEW Group managed €38.5bn of real estate assets on behalf of a number of funds and separate accounts with over 470 staff located in 10 locations.

 

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