RDI.L Regulatory News (RDI)

RDI REIT P.L.C.

 ("RDI" or the "Company")

(Registered number 010534V)

LSE share code: RDI

JSE share code: RPL

ISIN: IM00BH3JLY32

LEI: 2138006NHZUMMRYQ1745

Disposal of UK retail parks portfolio for £156.9m

RDI, the income focused UK Real Estate Investment Trust ("UK-REIT"), is pleased to announce that it has exchanged contracts for the disposal of its UK retail parks portfolio of six assets (the "Portfolio") for £156.9 million to M7 Real Estate Limited, on behalf of M7 Box+ II (the "Disposal").

The Disposal, which is a sale of the six associated special purpose vehicles, 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.

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.

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 Portfolio forms part of the Group's £275.0 million AUK financing facility which includes a £137.5 million revolving credit facility. The all-in interest rate for the facility is currently 3.2 per cent. The anticipated Disposal proceeds of approximately £156.9 million will be used to reduce the revolving credit facility by approximately £100 million, providing a significant reduction in leverage.

The remaining amount of circa £56.9 million will be held as cash within the Group. Cash and facility headroom are anticipated to increase to around £240.0 million with approximately £140.0 million of that amount held in cash (29 February 2020: £85.0 million). Subject to completion, the Group's pro-forma LTV based on the 29 February 2020 values will be reduced meaningfully to approximately 30.2 per cent. (29 February 2020: 41.8 per cent.).

Mike Watters, CEO at RDI, commented:

"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."

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About RDI

RDI is an income focused UK-REIT with a diversified portfolio invested principally in the UK. The investment approach is driven by an in depth understanding of occupational demand including the impact of technology, transport and infrastructure investment. The portfolio has been repositioned in recent years to increase its weighting to London and the South East and to provide greater exposure to our leading hotel and serviced office operating platforms.

RDI is committed to delivering attractive income led total returns across the real estate cycle. The current strategic objectives of a lower leverage capital structure and more focused allocation of capital are targeted at delivering an industry leading and sustainable income return.

RDI is a UK Real Estate Investment Trust (UK-REIT) and holds a primary listing on the London Stock Exchange and a secondary listing on the JSE. The Company is included within the EPRA, GPR, JSE All Property and JSE Tradeable Property indices.

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