Schroder Eur.r Regulatory News (SERE)

18 December 2017

NEW FRENCH DEBT FACILITIES SECURED AT ACCRETIVE INTEREST RATE

Schroder European Real Estate Investment Trust Plc (the "Company"), the company investing in European growth cities, announces it has completed a new debt facility in France with Banque Populaire, for €13 million.

The loan is secured against the Saint Cloud office building in Paris that was acquired by the Company in February this year. The loan proceeds form part of the Company's €30 million of remaining investment capacity and will be used to make further acquisitions completing the initial investment programme.

The loan represents 38% LTV against the value of the Saint Cloud asset. The seven year interest only facility has been agreed at a margin of 1.30% above the 3 month Euribor rate. With Euribor currently negative, it is applied at zero, resulting in a current total all-in interest cost of 1.30% p.a. This compares favorably with the acquisition net income yield of the Saint Cloud property of 9.5%. The Company has acquired an interest rate cap to limit the maximum future potential interest cost if Euribor were to increase, to an all-in rate of 2.55% p.a.

Following this agreement, the Company now has total outstanding debt of €73.4 million across five facilities, representing an LTV of approximately 29% against the overall gross asset value of the Company. The current blended all-in interest rate is 1.3%, substantially below the portfolio net initial yield against current valuation of c. 6%.

Sir Julian Berney Bt., Chairman of the Board, commented: "We are pleased to have secured this additional long term debt financing at an interest rate that compares favorably to the property income return of the portfolio. This is in line with our strategy of targeting gearing against those assets where it is most accretive to returns, whilst maintaining modest overall gearing and headroom to draw further debt. We have identified a range of potential investment opportunities that the loan proceeds could be deployed into and that would be accretive to the Company's earnings and progress us towards distributing the target 5.5% dividend."

Duncan Owen/Jeff O'Dwyer

Schroder Real Estate Investment Management Limited Tel: 020 7658 6000

Ria Vavakis

Schroder Investment Management Limited Tel: 020 7658 2371

Dido Laurimore/Richard Gotla/Ellie Sweeney Tel: 020 3727 1000

FTI Consulting