28 Sep 2011 07:00
The Local Shopping REIT plc
LOCAL SHOPPING REIT FORMS JOINT VENTURE
London: 28 September 2011 - The Local Shopping REIT ("LSR" or the "Company"), a UK real estate investment trust focused on local shopping assets, announces that it has entered into a 50/50 joint venture partnership with an established UK financial institution (the "JV"). The JV has been created as a workout vehicle to invest in commercial investment properties across the UK, primarily comprising local shopping assets that will benefit from the specialist management approach applied by LSR's highly experienced team.
LSR and its JV partner will each commit up to £5 million of equity with an initial drawdown of £710,000 each. The JV will acquire an initial portfolio of four properties at their market value of £3.39 million on a 7.8% net initial yield.
The JV's objective will be to hold the properties as investment assets and to grow this initial portfolio as LSR successfully applies its specialist management skills to maximise value and income. The assets will remain in the portfolio unless a clear exit beneficial to the JV's owners is identified.
The Company will receive management fees and incentive fees based on specific agreed performance hurdles.
Commenting on the creation of the JV, Mike Riley, Joint Chief Executive of LSR, said:
"The formation of this JV after the partnership with Pramerica announced in the last quarter of 2010 clearly demonstrates that institutions have a growing interest in identifying and creating value from this highly specialised asset class through proven intensive asset management techniques."
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For more information please contact:
The Local Shopping REIT plc Tel: 020 7292 0333Mike Riley/Nick Gregory
FTI Consulting Tel: 020 7831 3113Stephanie Highett/Richard Sunderland/Olivia Goodall
About The Local Shopping REIT
The Local Shopping REIT plc ("LSR") is the first specialist start-up Real Estate Investment Trust ("REIT") to launch in the UK.
Already a major owner of local retail property, the Company is building a portfolio of local shops in urban and suburban areas, investing in neighbourhood and convenience properties throughout the UK. Typical of the portfolio are shops in local shopping parades and neighbourhood venues for convenience or 'top-up' shopping. As at 31 March 2011, the Company's portfolio comprised 654 properties, with over 2,000 letting units. In addition to its wholly owned portfolio the company intends to deploy its unique set of specialist asset management skills in the management of third party assets and joint ventures, building upon its current mandate to manage smaller properties for two UK lenders.
For further information on LSR, please visit www.thelocalshoppingreit.co.uk.