Important Lease Restructure

RNS Number : 5992R

LXI REIT PLC

01 July 2020

 

1 July 2020

LXi REIT plc

(the "Company" or the "Group")

IMPORTANT LEASE RESTRUCTURE

LXi REIT plc (ticker: LXI) is pleased to announce that the Company's Investment Advisor has negotiated an important lease restructure with one of its largest tenants, BCA. 

The property represents one of the Company's largest assets with a March 2020 book value of £61 million. The site also represents a key operating asset for the tenant, BCA (which owns WeBuyAnyCar.com), being a 121 acre storage facility in Corby, primarily enabling online sales.  BCA's commitment to the location was further evidenced by their recent freehold purchase of an additional 40 acre expansion site adjacent to the Company's property.

The term of the lease has been extended from 16 years to 25 years, with no tenant break right.

The rent review has been converted from uncapped RPI with no collar, to RPI, capped at 2.5% pa and collared at 1.5% pa. The new collar provides a minimum rental uplift for shareholders, which is attractive in the current environment.

The rent remains unchanged on the asset and the first rent review will be five years from the date of the lease extension.

Following discussions with the Company's valuer, Knight Frank LLP, it is anticipated that the lease restructure will be accretive to shareholders.

After the lease restructure, 95% of the Group's rental income is inflation-linked or contains fixed uplifts and 68% of the income now has a minimum contractual uplift/collar, regardless of the inflation rate, averaging 2% pa.

FOR FURTHER INFORMATION, PLEASE CONTACT:

LXI REIT Advisors Limited John White (Partner, Fund Manager) Simon Lee (Partner, Fund Manager)	Via Maitland/AMO
Peel Hunt LLP Luke Simpson	Tel: [phone]
Maitland/AMO (Communications Adviser) James Benjamin	Tel: [phone] Email: [e-mail]

The Company's LEI is: 2138008YZGXOKAXQVI45

NOTES:

LXI REIT plc 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 robust 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 quarterly dividend of 1.30 pence per ordinary share for the quarter that commenced 1 April 2020. It will continue to monitor the improving visibility on its future rent collection as the UK moves out of lockdown and is keeping its dividend guidance under careful review on a quarterly basis.

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.

The Company is a constituent of the FTSE EPRA/NAREIT and MSCI indices.

Further information on the Company is available at www.lxireit.com

* These are guidance levels or targets only and not a profit forecast and there can be no assurance that they will be met.

 

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