AEW UK REIT PLC AEW UK REIT acquires properties totalling £22.5m (8911I)

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RNS Number : 8911I

AEW UK REIT PLC

26 March 2018

AEW UK REIT acquires properties in Dagenham and Wrexham for GBP22.5m

AEW UK REIT is pleased to announce that it has acquired the eastern section of London East Leisure Park, Cook Road, Dagenham and an industrial unit let to Plastipak UK Limited on Gresford Industrial Estate, Wrexham for a combined price of GBP22.5m.

London East Leisure Park is a purpose built leisure destination totalling 149,132 sq ft. The portion bought by AEW UK REIT comprises 72,245 sq ft and was acquired for GBP11.5m. The property currently houses Mecca Bingo, McDonalds and Hollywood Bowl and provides a net initial yield of 8% with a WAULT of 12.8 years. A major attraction of the park is its location, 11 miles east of Central London and being highly accessible both via public transport but also with close links to the A13 and M25. Dagenham is an area due to go through major regeneration over the next 10 years with the Council recently setting out plans for the development of thousands of new homes as well as the first film studio to be built in London for 25 years. The surrounding area comprises a mix of retail, industrial and residential property.

The Wrexham property, a 279,541 sq ft industrial unit leased to Plastikpak UK Limited, comprises 3 units within a self-contained and secure site and was acquired for GBP10.0m. The asset benefits from its location in Gresford Industrial Estate, approximately 2 miles north of Wrexham town centre, with key motorway links across the north west via the A483. A key feature of the building is its large power supply at 18 megawatts which is rarely seen in buildings of this nature and could therefore be attractive to future tenants. The asset provides a net initial yield of 8.3% and a WAULT of 14 years, with a fixed rental uplift due in 2022.

In order to complete the aforementioned acquisitions the Company has drawn GBP10 million from its existing loan facility with RBS International Limited which matures in October 2020. The facility amount has now been increased to enable the Company to utilise the facility up to GBP60 million. The Company will continue to target an amount equivalent to 25% of the Gross Asset Value as measured at drawdown, which can be increased to a maximum of 35% of Net Asset Value ahead of an equity fundraising or asset disposal.

Alex Short, Portfolio Manager, AEW UK REIT, commented: "We are very pleased to announce the above acquisitions which now bring the Company's debt level back in line with its long term loan to value target of 25%. The Company has now completed four acquisitions so far this year totalling c GBP39m providing a combined net initial yield of 8.6% which is supportive of our target annual dividend of 8p per share. We are encouraged by the strength of our current pipeline and are confident that the buying opportunities that the Company has been taking advantage of since IPO persist."

ENDS

About AEW UK REIT

AEW UK REIT plc (LSE: AEWU) aims to deliver an attractive total return to shareholders by investing predominantly in smaller commercial properties (typically less than GBP10 million), on shorter occupational leases in strong commercial locations across the United Kingdom. The Company was listed on the Official List of the UK Listing Authority and admitted to trading on the Main Market of the London Stock Exchange on 12 May 2015, raising GBP100.5m. Since IPO it has raised a further GBP51m.

The Company is currently invested in office, retail, industrial and leisure assets, with a focus on active asset management, repositioning the properties and improving the quality of the income stream.

AEWU is currently paying an annualised dividend of 8p per share.

www.aewukreit.com

About AEW UK Investment Management LLP

The Investment Manager AEW UK Investment Management LLP is a 50:50 joint venture between the principals of the Investment Manager and AEW. It employs a well-resourced team comprising 25 individuals covering investment, asset management, operations and strategy. It is part of AEW Group, one of the world's largest real estate managers, with EUR58.5 billion of assets under management as at 31 December 2017. AEW Group comprises AEW SA and AEW Capital Management L.P., a U.S. registered investment manager and their respective subsidiaries. In Europe, as at 31 December 2017, AEW Group managed EUR28.4 billion in value in properties of all types located in 15 countries, with close to 600 staff.

 
 
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About AEW Europe

AEW is one of the world's largest real estate asset managers, with EUR58.5bn of assets under management as at 31 December 2017. AEW has over 600 employees, with its main offices located in Boston, London, Paris and Hong Kong and offers a wide range of real estate investment products including comingled funds, separate accounts and securities mandates across the full spectrum of investment strategies. AEW represents the real estate asset management platform of Natixis Investment Managers, one of the largest asset managers in the world.

As at 31 December 2017, AEW managed EUR28.4bn of real estate assets in Europe on behalf of a number of funds and separate accounts. AEW has close to 400 employees based in 10 offices across Europe and has a long track record of successfully implementing core, value-add and opportunistic investment strategies on behalf of its clients. In the last five years, AEW has invested and divested a total volume of over EUR17.5bn of real estate across European markets.

www.aeweurope.com

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March 26, 2018 04:14 ET (08:14 GMT)