RDI REIT PLC London Serviced Offices Property Tour (4540F)

TIDMRDI

RNS Number : 4540F

RDI REIT PLC

21 February 2018

RDI REIT P.L.C.

("RDI" or the "Company")

(Registered number 010534V)

LSE share code: RDI

JSE share code: RPL

ISIN: IM00B8BV8G91

LEI: 2138006NHZUMMRYQ1745

LONDON SERVICED OFFICES PROPERTY TOUR

RDI, the FTSE 250 income focused UK-REIT, together with its new strategic partner, Office Space in Town ("OSIT"), will host a property tour for analysts and institutional investors today.

The event will include a presentation hosted by members of the RDI management team and Giles Fuchs, the CEO of OSIT, followed by site visits to three of the four recently acquired Central London serviced offices.

The presentation will be made available on the Company's website (www.rdireit.com) later today.

Mike Watters, CEO of RDI commented:

"We are pleased to have the opportunity to introduce the OSIT management team and recently acquired serviced offices. These well-located London assets are underpinned by strong real estate fundamentals, whilst delivering attractive yields in excess of 6%.

"Since acquisition, trading performance has been positive and ahead of management's expectations reflecting the strong occupier demand for flexible, cost efficient office space.

"We will be hosting a number of property tours in the future to showcase the income-producing opportunities that these properties present."

For further information and to be included on future property tours:

 
 RDI REIT P.L.C. 
  Mike Watters, Stephen Oakenfull, Janine          Tel: [phone] 
  Ackermann                                        0100 
 FTI Consulting 
  UK Public Relations Adviser 
  Dido Laurimore, Claire Turvey, Ellie Sweeney     Tel: [phone] 
                                                   1000 
 Instinctif Partners 
  SA Public Relations Adviser 
  Frederic Cornet, Lizelle du Toit                 Tel: [phone] 
                                                   3030 
 

Note to editors:

Acquisition summary

The Company announced on 15 January 2018 that it is expanding in to flexible serviced offices.

   --      Four Central London serviced offices valued at GBP161.7 million 

-- The equity consideration of GBP72.5 million reflects an 80% interest in the portfolio and includes transaction costs of less than 1.0%

-- Existing debt facilities of GBP73.5 million reflects an LTV of 45%, in line with the Company's strategic priority to reduce Group leverage

   --      Implied net initial yield of over 6.0% 
   --      The net cash yield on equity is anticipated to be in excess of 9.0% 

-- Office Space in Town ("OSIT"), the Company's new strategic partner, will retain the remaining 20% interest in the portfolio and receive an EBITDA based management fee to ensure strong alignment of interests

-- London is the leading serviced office market globally, where structural and behavioural changes are driving strong demand for flexible, cost efficient space

-- OSIT provides a premium flexible office service at mid-market rates which has consistently delivered high levels of occupancy and client satisfaction

-- All four properties have been extensively refurbished and redeveloped by OSIT in the last four years

-- All assets are strategically positioned within short walking distances of London Underground stations

-- In an exciting and growing market, this acquisition presents a scalable platform which could be easily integrated with future potential acquisitions and which complements RDI's existing portfolio

About RDI

RDI is a FTSE 250 UK Real Estate Investment Trust (UK-REIT) committed to becoming the UK's leading income focused REIT. The Company's income-led business model and strategic priorities are designed to offer shareholders superior, sustainable and growing income returns, with a target growth in underlying earnings per share of 3%-5% across the medium term.

Income sustainability is underpinned by a diversified portfolio and tenant base, with no overreliance on any one sector or tenant, together with an efficient capital structure. The secure and growing income stream is 39% indexed and has a WAULT of 7.4 years to first break (8.5 years to expiry). This is complemented by an average debt maturity of 7.3 years of which over 90% of interest costs are either fixed or capped. The Company is focused on all aspects impacting shareholder distributions and reports one of the lowest cost ratios in the industry whilst maintaining a low cost of debt. All figures as at 31 August 2017.

The Company owns properties independently valued at GBP1.5bn in the United Kingdom and Germany, Europe's two largest and most transparent property markets. RDI invests in assets with strong property fundamentals spread across UK shopping centres, UK retail parks, UK offices, UK logistics, UK hotels and German retail.

RDI holds a primary listing on the London Stock Exchange and a secondary listing on the Johannesburg Stock Exchange and is included within the FTSE 250, EPRA and GPR indices.

For more information on RDI, please refer to the Company's website www.rdireit.com

About Office Space in Town

Office Space in Town ("OSIT") was established in 2009 by a brother and sister team, Giles and Niki Fuchs, who have both been involved in the Serviced Office Industry for over 25 years.

It is a service company that offers businesses and individuals workspace solutions through providing serviced offices, managed offices, co-working space, meeting rooms and virtual offices in London, Cardiff, Northampton, and Edinburgh.

The company currently manages six London and five regional flexible offices, including the four offices acquired by RDI.

For more information on OSIT, please refer to the company's website www.officespaceintown.com

Pro forma portfolio

 
                                       Annual-ised 
                      % of                   gross                      EPRA                   Weighted    EPRA 
                 portfolio    Market        rental                   topp-ed                    average   voids 
 Pro forma       by market     value        income      ERV   EPRA        up   Reversion-ary      lease     (by 
 portfolio           value    (GBPm)        (GBPm)   (GBPm)    NIY     yield           yield     length    ERV)   % Indexed 
 
 
 UK Shopping 
  Centres              19%     316.5          26.2     27.1   6.4%      6.8%            8.0%        8.0    3.3%       27.5% 
 UK Retail 
  Parks                10%     169.9          11.4     10.8   5.8%      6.2%            6.0%        7.7    3.8%        4.7% 
 UK Other 
  Retail                2%      28.3           2.3      2.3   7.5%      7.5%            7.8%       16.6       -           - 
--------------  ----------  --------  ------------  -------  -----  --------  --------------  ---------  ------  ---------- 
 UK Retail             31%     514.7          39.9     40.2   6.3%      6.6%            7.3%        8.4    3.2%       19.4% 
 UK Offices 
  - Greater 
  London                6%      90.2           3.4      4.4   2.8%      3.3%            4.6%        5.1    4.1%       23.7% 
 UK Offices 
  - Flexible 
  London               10%     161.7          10.3     10.3   6.0%      6.0%            6.0%        2.2    5.6%           - 
 UK Offices 
  - Regions             7%     113.6           9.6      9.2   6.9%      7.7%            7.6%        3.3    4.2%       23.0% 
 UK 
  Distribution 
  & Industrial          7%     117.6           6.3      7.5   4.8%      5.0%            6.0%        5.0    3.7%           - 
 UK Automotive          3%      42.8           2.9      2.3   6.3%      6.3%            5.0%       12.3       -      100.0% 
--------------  ----------  --------  ------------  -------  -----  --------  --------------  ---------  ------  ---------- 
 UK Commercial         33%     525.9          32.5     33.7   5.4%      5.7%            6.0%        4.3    4.2%       18.2% 
 Greater 
  London 
  RBL 
  portfolio            11%     184.4          11.9     12.5   6.0%      6.0%            6.4%        8.3       -           - 
 IHL Hotels 
  - RBL 
  Portfolio             5%      75.4           6.0      6.0   7.5%      7.5%            7.5%       10.0       -           - 
 Edinburgh              2%      39.1           2.6      3.0   6.1%      6.1%            7.1%        8.5       -        3.4% 
 IHL Hotels 
  - Travelodge 
  Portfolio             2%      29.0           1.6      1.6   5.3%      5.3%            5.3%       21.1       -      100.0% 
 Enfield 
  Travelodge            1%      16.1           0.7      0.7   4.2%      4.2%            4.2%       29.9       -      100.0% 
--------------  ----------  --------  ------------  -------  -----  --------  --------------  ---------  ------  ---------- 
 UK Hotels             21%     344.0          22.8     23.8   6.2%      6.2%            6.5%       10.3       -       10.5% 
--------------  ----------  --------  ------------  -------  -----  --------  --------------  ---------  ------  ---------- 
 Total UK              85%   1,384.6          95.2     97.7   5.9%      6.2%            6.6%        7.5    2.8%       16.9% 
 German 
  Shopping 
  Centres              11%     181.3           9.4     10.6   4.2%      4.3%            5.5%        4.8    0.6%       94.5% 
 German 
  Supermarkets 
  and Retail 
  Parks                 4%      68.7           4.8      4.9   5.9%      5.9%            6.6%        5.2    3.2%       94.4% 
 Europe                15%     250.0          14.2     15.5   4.7%      4.7%            5.8%        4.9    1.4%       94.5% 
 Total                100%   1,634.6         109.4    113.2   5.7%      6.0%            6.5%        7.1    2.6%       27.0% 
--------------  ----------  --------  ------------  -------  -----  --------  --------------  ---------  ------  ---------- 
 

Pro forma reflects the portfolio as at 31 August 2017 adjusted for major transactions post year end.

This information is provided by RNS

The company news service from the London Stock Exchange

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February 21, 2018 04:00 ET (09:00 GMT)