20.2% ERV Uplift from Asset Management Initiatives

2 July 2020

REGIONAL REIT Limited

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

20.2% ERV Uplift from Asset Management Initiatives

Regional REIT (LSE: RGL), the regional real estate investment specialist focused on building a diverse portfolio of income producing regional UK core and core plus office and industrial property assets, is pleased to announce several new office, warehouse and retail lease renewals and extensions as part of the asset manager's active approach to optimising portfolio value. The rents amount to £531,364 with a total uplift of 20.2% to the estimated rental value ("ERV"), being predominately sourced from government-designated essential service occupiers.

Solihull Parkway, Birmingham Business Park, Solihull: A new office tenancy agreement has been signed with the tenant taking some 4,762 sq.ft.. The lease is for 10 years until June 2030 with a break option on 31 May 2025. Headline rent is £92,589 pa (£19.44/sq.ft.).

Marston Moor Business Park, Tockwith, York: A new office lease has been agreed for 11,673sq.ft.. The lease runs until June 2026 with a break option in June 2023. Headline rent is £79,400 pa (£6.80/sq.ft.), 70.0% above the ERV.

Marston Business Park, Tockwith, York: Three new leases across three units for use as a warehouse and distribution centre with the tenant amounting to 9,449sq.ft.. The leases run until June 2026 with break option in June 2023. Headline rent is £68,000 pa (£7.20/sq. ft.) for the three units, 19.9% above the ERV.

Unit 3, Acorn Business Park, Killingbeck Drive, York Road, Leeds: The tenant, Pivot Academy Leeds Ltd., has signed a lease until June 2025 for 3,345sq. ft. for office space, with a break option in June 2023. Headline rent is £34,300 pa (£10.25/sq. ft.) for the three units, 28.0% above the ERV.

Woodlands Court, Ash Ridge Road, Bristol: The office lease has been renewed with the existing tenant for two years until June 2022 (3,584 sq. ft.). Headline rent is £65,520 pa (£18.28/sq. ft.) for the three units, 14.3% above the ERV.

Witham Park, Waterside South, Lincoln: The office lease has been extended for one year with the tenant until July 2021, including a rolling break subject to 3-mths notice and a rent of £71,055 pa (£8.96\sq.ft.). Following a recent refurbishment, the tenant has already taken 17,000 sq. ft.

York House, 102a Hamilton Road, Felixstowe: Tenant retained beyond break and lease secured until November 2022 (1,358 sq. ft.). Rent is set at £13,500 (£9.94\sq.ft.) until November 2021 and £14,000 (£10.31\sq.ft.) thereafter.

High Street, Dumfries: The tenant has extended the lease on the 13,687 sq. ft. of retail space from 2025 to September 2029, some 65.1% above ERV.

Stephen Inglis, Chief Executive Officer of London & Scottish Property Investment Management Limited, the Asset Manager commented:

 "Good progress is being made and today's announcement further demonstrates that Regional REIT has a successful strategy and model, adaptable to meet our clients' needs, even in these testing times. The positive progress achieved as part of our ongoing asset management plan has resulted in ERV uplifts amounting to 20.2% and follows on from our strong Q1 rental collection previously announced. More than ever, our close relationships with tenants and the strength of experience in the asset management team that spans previous financial crises, continue to be invaluable in creating exemplary usable spaces suitable for the new environment that meet the needs of tenants and optimise value for shareholders."

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About Regional REIT                                                         

Regional REIT Limited ("Regional REIT" or the "Company") and its subsidiaries (the "Group") is a United Kingdom ("UK") based real estate investment trust that launched in November 2015. It is managed by London & Scottish Property Investment Management Limited, the Asset Manager, and Toscafund Asset Management LLP, the Investment Manager.

Regional REIT's commercial property portfolio is comprised wholly of income producing UK assets and comprises, predominantly, offices and industrial units located in the regional centres outside of the M25 motorway. The portfolio is highly diversified, with 160 properties, 904 tenants as at 31 December 2019, with a valuation of £787.9m.

Regional REIT pursues its investment objective by investing in, actively managing and disposing of regional core and core plus property assets. It aims to deliver an attractive total return to its Shareholders, targeting greater than 10% per annum, with a strong focus on income supported by additional capital growth prospects.

The Company's shares were admitted to the Official List of the UK's Financial Conduct Authority and to trading on the London Stock Exchange on 6 November 2015. For more information, please visit the Group's website at www.regionalreit.com.

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