12 January 2015
Ground Rents Income Fund plc
("GRIF" or the "Company")
Option Agreement and Acquisition Update for Muse Portfolio
Ground Rents Income Fund plc, a listed real estate investment trust (REIT) investing in UK ground rents, has entered into option agreements to purchase a portfolio of prime residential ground rents.
GRIF has entered into option agreements to purchase up to 583 residential units in six buildings for a total consideration of up to £3.90 million. Under the option agreements, GRIF has the option to complete the acquisitions for each of the six buildings, once practical completion has been achieved and the units are sold. The acquisitions are expected to be completed over the course of 2015.
The vendor is Muse Developments, part of Morgan Sindall Group plc, and its joint venture partners. The purchase would be financed from the proceeds of the proposed Capital Raise, as announced on 12 January 2015.
GRIF's option agreements relate to six sites, comprising 184 units at Chatham Place in Reading,113 units at Wapping Wharf in Bristol, 97 units at Vimto Gardens in Salford, 77 units at One Smithfield Square in Manchester, 66 units at Merchant Gate in Wakefield and 46 units at Islington Wharf Mews in Manchester.
The option agreements follow the completion of the acquisition of a first portfolio of prime residential ground rents from Muse Developments and its joint venture partners, as announced last year. The total consideration for the 747 units was £3.75 million, this portfolio included Aurelia in Canning Town, London, Islington Wharf in Manchester, St Paul's Square in Liverpool, Candle House and Waterman's Place in Leeds and Millbay in Plymouth.
James Agar, Investment Director of Brooks Macdonald Funds, Investment Adviser to GRIF, commented:
"We are particularly pleased to be working with Muse Developments, who are a respected developer of high-quality, residential and mixed-use schemes.
These options agreements allow GRIF the certainty and visibility of some outstanding residential assets, whilst providing Muse and its joint venture partners with a workable, efficient structure from both an income and a taxation perspective.
The portfolio itself covers a number of assets across the country, including but not limited to, Wapping Wharf in Bristol, Chatham Place in Reading, and Vimto Gardens and Islington Wharf in the North West. These assets will allow GRIF to increase the assets under management over the next 6 months as these schemes are completed and sold, providing further forecastable, defensive income to the REIT and its shareholders."
Nigel Franklin, Joint Managing Director of Muse Developments, commented:
"We are delighted to be working with Brooks MacDonald on this portfolio and I am sure it will prove to be a successful transaction for both parties."
Contacts:
Brooks Macdonald Funds Limited Simon Wombwell / James Agar |
020 7499 6424 |
N+1 Singer James Maxwell / Emily Watts - Corporate Finance Alan Geeves / Sam Greatrex - Sales |
020 7496 3000 |
Appleby Securities (Channel Islands) Limited Kate Storey |
01481 755600 |
Tavistock Communications Jeremy Carey / James Whitmore |
020 7920 3150 |
Website: www.groundrentsincomefund.com
