NewRiver Regulatory News (NRR)

NewRiver Retail Limited

("NewRiver" or the "Company")

Exchange of contracts for £53.5 million acquisition

of 158 Pubs from Punch Taverns, at a net initial yield of 13.61%

NewRiver Retail Limited (AIM: NRR), the UK REIT specialising in value-creating retail property investment, active asset management and development, announces that it has exchanged contracts to acquire a portfolio of 158 pubs across England and Wales (the "Portfolio") from Punch Taverns for a total consideration of £53.5 million which equates to a net initial yield of 13.61%. The projected annual profit before tax of the portfolio is circa £6 million, which will generate a cash on cash equity return in excess of 20%.

The acquisition of the portfolio includes circa £0.5m of fixtures, equipment and other assets and will be funded through existing financial resources, with a new debt facility available in due course.

The acquisition is in line with the Company's proven business model of acquiring strategically selected property assets that offer high cash on equity returns and present opportunities to create capital growth through NewRiver's active asset management and risk-controlled development. NewRiver identified the pub sector as an attractive asset class to deliver on its business objectives and in November 2013 the Company acquired a portfolio of 202 pubs from Marston's. Following completion of this acquisition, NewRiver's pub portfolio will account for circa 15% of its total assets under management, which will total nearly £1 billion.

The Portfolio

The Portfolio comprises 158 pubs across the UK, predominantly located throughout England, with 34% of sites in the South East and South West. The Portfolio comprises 339,866 sq. ft. of total internal gross area, 1,844,766 sq. ft. of total site area and 1,730 car parking spaces and has an estimated reinstatement value of £146 million.

The quality and stability of the Portfolio is reflected in it being 99.4% let and effectively 100% let for the last four years. The revenue arrears are negligible and beer volumes have increased by 2.24% per annum, compound, over the last four years.

The Portfolio has significant asset management and development opportunities, including unlocking and creating capital growth through the introduction of new and complementary uses, as well as offering existing occupiers longer, more sustainable leases. NewRiver has appointed a third party specialist pub management company to run the day to day management of the Portfolio and deliver pre-identified efficiencies, allowing NewRiver to focus on the asset management and development programme.

NewRiver has identified a number of value-enhancing development opportunities within the Portfolio, which could include residential new builds on surplus land, extension or part-conversion of pub assets for residential use and the build of new convenience stores on surplus land.

Allan Lockhart, Property Director at NewRiver Retail, said:

"We are delighted to announce the acquisition of the pub portfolio from Punch Taverns, which represents a strategic progression for NewRiver, following our acquisition of a similar portfolio from Marston's in late 2013, the successful result of which has led us to identify similar opportunities.

In many ways this Portfolio is similar to our Marston's transaction, in that we expect to deliver exceptional cash on cash returns and attractive capital growth through asset management and development. We are confident that this acquisition will add significant long term value for our shareholders."

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About NewRiver

NewRiver Retail Limited is an AIM listed REIT. The Company is a specialist real estate investor, asset manager and developer focused solely on the UK retail sector. At the close of 2014 NewRiver Retail was named Property Company of the Year - Retail & Leisure at the Estates Gazette Awards.

The management team, with over 100 years combined experience in the UK commercial property market, actively engages with retailers, stakeholders and consumers. NewRiver Retail is one of the UK's largest shopping centre owner/managers with assets under management of £918 million principally comprising 29 UK wide shopping centres, further nationwide retail assets and a portfolio of 202 public houses principally suitable for conversion to alternative uses. The portfolio has 1,440 occupiers, a total of over 6.0 million sq. ft., total annual footfall of over 121 million and a retail occupancy rate of 96 per cent.

The Company's activities include active and entrepreneurial asset management and risk-controlled development, utilising both its own balance sheet and co-investment joint venture structures.

Founded in 2009, NewRiver has become the UK's leading retail-focused property investment business. The Company's shares were admitted to London's AIM in September of the same year. For more information on NewRiver, please visit www.nrr.co.uk