Interim Management Statement

RNS Number : 7068L

ING UK Real Estate Income Trust Ltd

11 May 2010

ING UK Real Estate Income Trust Limited

Further to the Q1 NAV announcement issued on 15 April 2010, please find attached via the link below, the Interim Management Statement/Newsletter for ING UK Real Estate Income Trust Limited for the period 31 December 2009 to 31 March 2010:

http://www.ingreit.co.uk/default.aspx?page=investor-relations-quarterly&folder=1

With guidance from the FSA/AIC we have included the unedited full text of the announcement below:-

ING UK Real Estate Income Trust Limited

Q1 Interim Management Statement

Facts & Figures (as at 31 March 2010)

Launch Date	25 October 2005
Shares in issue	330.4 million
Share Price	48 pence
Dividend	1 pence per share paid 26/02/2010
Market Capitalisation	GBP 158.6 million
Net Asset Value	GBP 186.3 million
Property Value	GBP 352.4 million
Net Asset Value per Share	56 pence
Number of Properties	41
Average Lot Size	GBP 8.60 million
Average Lease Length	8.13 years
Net Gearing*	41.1%
Weighted Average Cost of Debt**	4.88%
Current Debt***	GBP 175 million
Financial Year End	31 December 2010
Half Year	30 June 2010
Dividend Payment Dates	Aug/Nov/Feb/May
Total Expense Ratio	1.00% Annualised to 31/03/2010

* Net gearing is calculated as total debt less cash deposits as a proportion of gross property asset value.

** Excluding loan arrangement costs

*** This ignores the liquidity facility of GBP 10.9 million.

Source: ING Real Estate Investment Management UK Limited

Key Highlights

> Increase of GBP 7.2 million in the underlying property portfolio value over the quarter, representing an increase of 2.1% on a like-for-like basis.

> Rise in NAV per share of approximately 2.9% over the quarter, reflecting an increase of c. 1 pence per share.

> Repayment of GBP 15 million of securitised debt over the quarter, at a 5% discount to the nominal value.

> Disposal of office asset at a 19% premium to the December 2009 valuation.

> Announcement of offer for Rugby REIT plc following the end of the quarter.

About The Company

The Company is a closed-ended, Guernsey registered investment company. The Company was launched on the London and Channel Islands' Stock Exchanges on 25 October 2005. The property portfolio is managed by ING Real Estate Investment Management (UK) Limited, a member of the ING Group.

Investment Objectives and Process

The Company's aim is to provide shareholders with an attractive level of income together with the potential for capital growth, through investment both directly and indirectly in UK commercial real estate.

The Company can invest in commercial real estate in the UK, the Isle of Man and the Channel Islands. It can invest principally in five commercial property sectors: office, retail, retail warehousing, industrial and leisure. It also has the ability to invest in other property funds and the residential sector.

Performance

As at 31^st March 2010 the Net Asset Value of the Company was GBP 186.3 million, reflecting c. 56 pence per share. The underlying property portfolio saw a capital increase of 2.1%, which combined with a negative mark to market movement in the swap valuation, resulted in an increase in the NAV of c. 2.9% over the quarter.

IRET - NAV & Share Price
Date	NAV	Share Price (as at quarter end)
31 March 2007	129 pence	121 pence
30 June 2007	133 pence	106.25 pence
30 September 2007	124 pence	101.5 pence
31 December 2007	112 pence	69.5 pence
31 March 2008	102 pence	69 pence
30 June 2008	97 pence	47.5 pence
30 September 2008	84 pence	46 pence
31 December 2008	64 pence	22.5 pence
31 March 2009	52 pence	19 pence
30 June 2009	49 pence	30.5 pence
30 September 2009	49 pence	42.5 pence
31 December 2009	55 pence	53.8 pence
31 March 2010	56 pence	48 pence

Changes in Capital Structure

In January 2010 the Company pre-paid GBP 15 million of its securitised loan at a discount to its nominal value, reducing the total debt outstanding under the facility to GBP 175 million.

Diversification

Sector	Weighting (%)
Retail	13.9%
Offices	39.3%
Industrial	33.1%
Leisure	5.1%
Retail Warehouse	8.6%

(Source: ING REIM Mar 2010)

Geographical	Weighting (%)
Central London	8.5%
Greater London	5.3%
South East	21.8%
East	10.2%
Midlands	20.6%
South West	4.7%
North	19.2%
Wales	6.6%
Scotland	3.0%
Northern Ireland	0.0%
Offshore UK	0.0%

(Source: ING REIM Mar 2010)

Security of Income

The property portfolio has an average unexpired lease term of 8.1 years. As a percentage of current net annual rent, the length of the lease to the first termination is summarised below.

Lease Length	%
0 - 5 years	49.7%
5 - 10 years	29.5%
10 - 15 years	9.6%
15 - 25 years	8.0%
25 + years	3.2%

(Source: ING REIM Mar 2010)

The covenant strength, based as a percentage of current passing rent by risk rating, is shown in the chart below. The Company also holds GBP 1.2 million in rental deposits.

Risk Rating
	Negligible (%)	Low (%)	Low-Med (%)	Med-High (%)	High (%)	Max (%)	Un-Scored + Ineligible (%)
ING UK REIT	52.03%	26.86%	4.92%	1.50%	4.51%	7.24%	2.94%
IPD Benchmark	42.33%	27.06%	9.06%	3.10%	5.59%	8.70%	4.16%

(Source: IPD Dec 2009)

Acquisitions and Disposals

Over the quarter no acquisitions were made. The Company completed on the disposal of Bath Road, Slough for a total consideration of GBP 8.91 million, reflecting a 19% premium to the December 2009 valuation.

Fund Managers Commentary

The IPD Monthly Index delivered strong capital growth over the quarter of 3.9%, albeit this was substantially lower than the record rise seen in the last quarter of 2009. The rate of rental value declines in each sector also slowed markedly over the period, and in March the Office sector returned its first positive rental growth for 2 years. The void rate on the Index decreased over the quarter, and at the end of March stood at 10.8%.

On a like-for-like basis, the Company's property portfolio rose in value by GBP 7.2 million over the 3 months.

Notable transactions over the period included a new letting at Northampton Business Park to Ricoh at a rent of GBP 350,000 pa; and the agreement to accept a surrender on its Farringdon building for over GBP 4 million- these monies will in part allow the building to be refurbished and relet.

Following the period end the Company announced that it had made an offer for Rugby REIT plc. More details are available on the Company's website.

Important Information

This newsletter is issued by ING UK Real Estate Income Trust Limited ("IRET"). It is based on information supplied by the Investment and Property Manager, ING Real Estate Investment Management (UK) Limited. This newsletter is intended for shareholders of IRET only. It is not a recommendation to deal or refrain from dealing in the shares of IRET. This newsletter should not be passed to any person other than an existing shareholder in IRET or their professional adviser. Any shareholder who requires advice on their investment in IRET should contact their stock broker, bank or independent financial adviser.

Contact Information

Fund Administration

David Sauvarin

Northern Trust International Fund

Administration Services (Guernsey) Limited

P.O. Box 255, Trafalgar Court, Les Banques,

St Peter Port, Guernsey GY1 3QL

T: 01481 745 001

Broker

William Simmonds

JP Morgan Cazenove

20 Moorgate, London, EC2R 6DA