Attractive Acquisition for £10.2m yielding 10.1%

5 October 2020

REGIONAL REIT Limited

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

Attractive Acquisition of Two Offices for £10.2m yielding 10.1%

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, today announces it has completed the attractive acquisition of two office properties in Swansea and Bristol for a total consideration of £10.2m, with a combined net initial yield of 10.1% and a weighted average unexpired lease term ("WAULT") to first break of 4.2years.

Waterside Business Park, Swansea

The two-floor office asset comprises 68,535 sq. ft. and is set over a 4.1 acre site with ample parking. Being situated less than three miles from Swansea City Centre and train station it also benefits from excellent road and rail links. It is let to The Secretary of State for Communities & Local Government and a large legal practice with offices across Wales.

The current contracted rent of £690,000 per annum reflects a net initial yield of 11.7% and a WAULT of 4.5years.

2410 Aztec West, Bristol

The two-floor office asset (22,349 sq.ft.) is fully let to Liverpool Victoria Friendly Society Ltd., and is set in 1.4 acres with 114 car parking spaces. This site also benefits from both excellent road and rail links, given its location next to the M5 motorway and less than three miles from Bristol Parkway train station.

The current contracted rent of £406,000 per annum reflects a net initial yield of 8.2% and a WAULT of 3.6years.

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

"These two acquisitions from a major UK institutional investor, further diversify our portfolio, deliver attractive yields, and increase our presence in the South West and Wales, these being locations where we see potential for continued strong economic growth and demand. Additionally, both assets present further asset management opportunities in line with our core expertise, to improve income and create accretive capital value for our 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 151 properties as at 30 June 2020, with a valuation of £742.3m.

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