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On 28 June 2023, NewRiver REIT plc and PAF Lux SCA (BRAVO) completed the disposal of Kittybrewster Retail Park in Aberdeen and Glendoe and Telford Retail Parks in Inverness to RI UK 1 Limited for £62.6 million (£31.3 million NewRiver share). This action represents the final disposals within the Napier Joint Venture, bringing total sale receipts from Napier to £76.0 million, which is 26% higher than the £60.5 million paid in June 2019. The sale proceeds reduced NewRiver's net debt by £31.8 million and resulted in a proforma Loan-to-Value (LTV) of 30.3% as at 31 March 2023.
| Date | 28 Jun 2023 |
| Time | 07:00:04 |
| Category | Disposals |
| ID | 1176E |
NewRiver REIT plc
("NewRiver" or the "Company")
Final disposals within Napier 50/50 Joint Venture
NewRiver and PAF Lux SCA, SICAV RAIF, acting on behalf of its compartment PAF - Bravo III Compartment ("BRAVO") are pleased to announce the completion of the disposal of Kittybrewster Retail Park in Aberdeen and Glendoe and Telford Retail Parks in Inverness for £62.6 million (NRR share: £31.3 million) to RI UK 1 Limited. The assets generated net rental income of £5.7 million (NRR share: £2.9 million) during FY23 and had a gross asset value of £64.4 million (NRR share: £32.2 million) at 31 March 2023. The sale proceeds will be used to reduce NewRiver's net debt as at 31 March 2023 by £31.8 million (net cash receipt of £19.8 million and repayment of secured debt of £12.0 million) to £169.5 million on a proforma basis which reduces NewRiver's LTV as at 31 March 2023 to 30.3% on a proforma basis.
The disposal comprises the final properties in the Napier Joint Venture, bringing the total sale receipts from Napier to £76.0 million, reflecting a blended net initial yield of 7.4%. Total receipts are 26% higher than the price paid when NewRiver and BRAVO acquired the portfolio in June 2019 from a UK Institution for £60.5 million, which reflected a blended net initial yield of 9.8%. Since acquisition the Napier Joint Venture has generated an IRR of 16% and following the disposal of Napier, NewRiver and BRAVO continue to own two assets within a separate venture.
Allan Lockhart, Chief Executive commented: "The Napier Joint Venture is a great example of why we like retail parks and working in capital partnerships. Over our four years of ownership and management, we have been able to crystallise compelling returns for ourselves and our partner by utilising our specialist retail platform at each stage of the process, all the way from disciplined stock selection to successful delivery of asset management plans in order to secure a successful exit. In addition, the disposal means that the strength of NewRiver's balance sheet position is further improved, with proforma LTV now at 30.3% and significant cash resources giving maximum flexibility and optionality around capital allocation."
NewRiver has completed several successful initiatives across the portfolio, with highlights including:
Kittybrewster Retail Park, Aberdeen
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Let 10,000 sq ft unit which was vacant at acquisition to Wren Kitchens on 10 year lease |
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Following Harveys administration in 2020, quickly re-let 10,000 sq ft unit to Dreams on 10 year term |
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Introduced JD Sports to the park in a 9,600 sq ft unit on a 10 year lease |
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Secured new 10 year term at lease renewal with TK Maxx lease on 16,700 sq ft |
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Actioned historic Halfords rent review shortly after acquisition increasing rent by 34% |
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Increased McDonald's rent by 11% at rent review |
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Re-geared Oak Furnitureland on new 10 year lease, extending expiry from 2024 to 2030 |
Glendoe and Telford Retail Parks, Inverness
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Surrendered Curry's lease (not trading from unit at acquisition) on 20,000 sq ft unit, for a significant premium and simultaneously completed new lettings to Bensons for Beds and Food Warehouse, having secured planning consent for food, on 10 year terms |
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Actioned landlord break on Poundstretcher and re-let 15,000 sq ft unit to Poundland on new 5 year lease |
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Completed a reversionary lease with B&M adding 10 years to their existing term resulting in a June 2034 expiry |
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Let 10,000 sq ft void unit at acquisition to the Department for Work & Pensions |
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Re-geared Oak Furnitureland and Go Outdoors on new 10 year leases |
Units at Kingsway East Retail Park, Dundee (Sold in March 2021)
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Sold property to a special purchaser, an existing tenant, at premium pricing having agreed a deal with an alternative tenant to occupy their unit. The property also included a 34,500 sq ft unit let to B&M |
Wakes Retail Park, Newport, Isle of Wight (Sold in March 2022)
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Downsized Curry's from 30,000 to 15,000 sq ft in return for a surrender premium, extending their term by 5 years with the remainder, on which food planning consent was obtained, re-let to Food Warehouse on a 10 year term |
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Completed a lease re-gear with Pets at Home, extending their lease term by 5 years |
For further information
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NewRiver REIT plc |
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+44 (0)20 3328 5800 |
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Allan Lockhart (Chief Executive) Will Hobman (Chief Financial Officer) |
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Lucy Mitchell (Communications & Investor Relations) |
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FGS Global |
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+44 (0)20 7251 3801 |
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Gordon Simpson James Thompson |
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The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of the law of England and Wales by virtue of the European Union (Withdrawal) Act 2018. This announcement has been authorised for release by the Board of Directors.
About NewRiver
NewRiver REIT plc ('NewRiver') is a leading Real Estate Investment Trust specialising in buying, managing and developing resilient retail assets throughout the UK.
Our £0.6 billion UK wide portfolio covers 7 million sq ft and comprises 26 community shopping centres and 14 conveniently located retail parks occupied by tenants predominately focused on essential goods and services. Our objective is to own and manage the most resilient retail portfolio in the UK, focused on retail parks, core shopping centres, and regeneration opportunities in order to deliver long-term attractive recurring income returns and capital growth for our shareholders.
NewRiver has a Premium Listing on the Main Market of the London Stock Exchange (ticker: NRR). Visit www.nrr.co.uk for further information.
LEI Number: 2138004GX1VAUMH66L31