UK Real Estate Investment Trust RDI has agreed to sale its UK retail parks portfolio of six assets for £156.9 million to M7 Real Estate Limited, on behalf of M7 Box+ II.
The transaction is anticipated to complete in mid-October 2020. The purchase price reflects a 3.0 per cent. discount to the last reported 29 February 2020 values and a topped-up net initial yield of 7.5 per cent.
RDI said, as at 29 February 2020, and as last reported, the portfolio had gross annualised rental income of £12.5 million, a WAULT of 7.3 years and occupancy of 98.4 per cent.
The Portfolio comprises the following assets:
· Banbury Cross Retail Park, Banbury;
· St Davids Retail Park, Bangor;
· Milton Road Retail Park, Edinburgh;
· Queens Drive Retail Park, Kilmarnock;
· Priory Retail Park, Merton, London; and
· The Arches, Watford, London.
”The transaction is a significant milestone in the ongoing repositioning of the Company’s portfolio and reflects a pro-forma reduction in the Group’s overall retail exposure to 11.8 per cent. (29 February 2020: 28.4 per cent.), including the recently announced disposal of the Schloss Strassen Center in Berlin. As previously announced, €50.5 million of German retail assets remain subject to disposal and are at various stages of negotiation,” said the compnay in a press release.
“Together with the disposal of Schloss Strassen Center in Berlin just last week, we have taken a substantial step forward in the implementation of our portfolio strategy in a very short space of time and against a challenging backdrop. In just 18 months since announcing our strategic review, we have undertaken around £330 million of disposals and our teams working on these transactions deserve to be commended for markedly reducing our exposure to the retail sector. This major transaction also further reinforces our balance sheet by bringing our leverage down significantly whilst extending our cash position. Having now achieved a number of our strategic priorities, the Company is in a strong position,” said Mike Watters, CEO at RDI.