Acquisition of £31.4m regional portfolio

REGIONAL REIT Limited

("Regional REIT", "the Group" or "the Company")

 17 August 2018

ACQUISITION OF £31.4 MILLION REGIONAL PORTFOLIO

Regional REIT, the UK regional office and industrial property focused real estate investment trust, today announces it has exchanged and completed on contracts to purchase eight assets for a consideration of £31.4 million.

The portfolio consists of eight offices located in Hull, High Wycombe, Stockton-on-Tees, Ipswich, Clevedon, Wakefield, Deeside and Lincoln. The assets total circa 275,000 sq. ft., let to 24 tenants.

The assets are expected to provide a net income of approximately £2.81 million per annum, which equates to a net initial yield of 8.66%.

Stephen Inglis, Chief Executive Officer of London & Scottish Investments Limited, the Asset Manager to Regional REIT, commented:

"This acquisition once again highlights our disciplined approach to capital management, with disposal proceeds being promptly redeployed ensuring minimal cash drag. The difference between the yields of this portfolio and that of recently disposed assets provided us with a clear arbitrage opportunity and highlights our policy of making income accretive acquisitions.

"In addition, the portfolio, which presents good asset management opportunities, complements our existing income streams and further diversifies both our tenant base and our exposure to different regions."

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Notes to Editors

About Regional REIT

Regional REIT Limited (LSE: RGL) is a London Stock Exchange Main Market traded specialist real estate investment trust focused on office and industrial property interests in the principal regional locations of the United Kingdom outside of the M25 motorway.

Regional REIT is managed by London & Scottish Investments, the Asset Manager, and Toscafund Asset Management, the Investment Manager, and was formed by the combination of two existing funds previously created by the Managers as a differentiated play on the expected recovery in UK regional property, to deliver an attractive total return to Shareholders and with a strong focus on income.

As at 31 December 2017, Regional REIT's investment portfolio, was spread across 164 regional properties, 1,368 units and 1,026 tenants. As at 31 December 2017, the investment portfolio had a value of £737.3m, with a combined contracted rent roll of £61.9 million per annum reflecting a net initial yield of 6.5% on a weighted average unexpired lease term of around five years.

Regional REIT's investment objective is to deliver an attractive total return to its shareholders, with a strong focus on income. It pursues this investment objective by following an investment strategy involving active property management and prudent use of debt finance.

Cautionary Statement

This document has been prepared solely to provide additional information to Shareholders to assess the Group's performance in relation to its operations and growth potential. The document should not be relied upon by any other party or for any other reason. Any forward looking statements made in this document are done so by the Directors in good faith based on the information available to them up to the time of their approval of this document. However, such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.

ESMA Legal Entity Identifier ("LEI"): (549300D8G4NKLRIKBX73)