LXB Retail Properties Plc Significant progress at Rushden Lakes (6397W)

TIDMLXB

RNS Number : 6397W

LXB Retail Properties Plc

16 November 2017

 
    16 November 2017 
 

LXB RETAIL PROPERTIES PLC

(the "Company" or the "Group" or "LXB")

Significant progress at Rushden Lakes

LXB Retail Properties Plc, the Jersey resident closed-ended real estate investment company focused on edge of town and out of town retail assets, is pleased to report that the review period associated with the revised planning consent for Rushden Lakes which was issued on 11 September 2017 has now expired with no objection. In consequence, the enhanced planning consent which was approved by the Planning Committee of East Northamptonshire Council on 8 February 2017 is now confirmed and beyond challenge. That, coupled with further letting progress reported below, means that the revised agreement providing for The Crown Estate to fund the next two phases at Rushden Lakes is now unconditional.

In total, The Crown Estate has committed to fund a further 215,000 sq ft of retail and leisure space at this Northamptonshire destination. Delivered over three additional phases of development, this will bring the total size of Rushden Lakes to more than 445,000 sq ft. LXB is already on site with Phases 2 and 3: the anticipated practical completion date for Phase 3 is June 2018 and for Phase 2 it is January 2019. The Group expects work to start on Phase 4 in May 2018.

Phase 2 will see the creation of a new leisure development, offering more than 150,000 sq ft of space, and comprised of 11 restaurants, 5 leisure units and a 14-screen cinema from Cineworld. In Phases 3 and 4, up to 130,000 sq ft (65,000 sq ft on ground floor) of additional retail space will be added.

Once all phases are delivered, Rushden Lakes will be home to over 40 retail units, 18 restaurants, 5 leisure providers, a 14-screen cinema, a boathouse and The Wildlife Trust visitor centre. The total parking provision will increase to more than 1,900 spaces once all phases are delivered.

90% of the Phase 2 space is pre-let, with a further 2% in solicitors' hands. Phase 3 is 63% pre-let following the recent signing of an agreement for lease with Wren Kitchens for a 12,000 sq ft unit and another 20% is currently in solicitors' hands.

There have also been further lettings at Phase 1. Following recently signed pre-lets with Card Factory, Jack Wills and Jamaica Blue, that phase is now circa 96% let. Additionally, a 4,649 sq ft unit has been let to Superdry (subject to planning) and a further lease with Robert Goddard for an additional 2,352 sq ft is in solicitors' hands. Solicitors are also instructed in connection with a lease to Magazine Heaven for the last remaining Phase 1 unit (2,729 sq ft).

Under the funding agreement the Group will shortly receive initial payments totalling GBP8.6m in relation to both Phase 2 and Phase 3.

Further receipts, the quantum of which is dependent on the terms achieved on further lettings and the actual development costs, are expected once each phase has reached practical completion and the relevant leases have been completed with the tenants.

In order to secure initial payments for Phase 4, the funding agreement requires that 75% of the space is pre-let. At present there are no pre-lets in place; however, discussions with potential occupiers are in progress.

Previous announcements have referred to a claim by Highways England concerning potential cost over-runs in connection with the highways improvements at Rushden Lakes. The Group's advisers have now held initial meetings with Highways England and further dialogue is planned. The Group will update further when it is appropriate to do so.

Commenting on these developments, Tim Walton CEO of LXB Adviser LLP said;

"It has been a long haul since the planning committee approved the revised plans for Phases 2 and 3 in February 2017. It is very good news that the planning position is finally confirmed, but practical completion will be six months later than the Group intended simply because of the planning delays suffered as a result of the calling of the General Election in June 2017."

"It is also pleasing to have secured all these new lettings in a tough retail and leisure market. It is testimony to Rushden Lakes' unique appeal to be able to continue to attract premium brands such as Jack Wills and Superdry. It is also proving to be a showcase for emerging retailers such as Robert Goddard and Jamaica Blue which have already opened successfully."

"The Group will continue discussions with The Crown Estate about how it can deliver the remaining potential of this large and very successful scheme with what is now a reduced balance sheet and a commitment to return as much cash to shareholders as possible."

For further information please contact:

LXB Adviser LLP Tel: [phone]

Tim Walton, CEO

Brendan O'Grady, FD

J.P. Morgan Cazenove (NOMAD) Tel: [phone]

Bronson Albery/Paul Hewlett

Buchanan Tel: [phone]

Charles Ryland/Victoria Hayns/Patrick Hanrahan

This information is provided by RNS

The company news service from the London Stock Exchange

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November 16, 2017 02:00 ET (07:00 GMT)