Schroder Real Regulatory News (SREI)

2 April 2012

Schroder Real Estate Investment Trust Limited

(the 'Company' / 'Group')

COMPLETION OF £19.5 MILLION WEST BROMWICH DISPOSAL

£10 million of proceeds to be used to repay debt

Following the announcement on 2 March 2012 confirming an exchange of contracts, Schroder Real Estate Investment Trust Limited announces the completion of the disposal of its office property let to British Telecommunications PLC ('BT PLC') in West Bromwich for £19.5 million. The property was acquired for £14.86 million in October 2011.

Following completion the Company now has a total cash balance of £37.2 million, of which £11.4 million is outside the security pool charged to the Group's lenders, with the balance of £25.8 million inside the security pool.

The Board and the Investment Manager have reviewed how this cash may best be utilised to progress the Company's key strategic objectives of improving dividend cover and positioning the portfolio in anticipation of its loan re-financing event in July 2014.

Whilst new investment opportunities are being sought and appraised, the Board and Investment Manager believe that, currently, greater shareholder value can be derived from utilising £10 million of cash held in the security pool to repay debt. The Company will therefore repay debt on 16 April which will immediately save the Company loan interest of £0.53 million per annum, enhance dividend cover and improve the Company's refinancing prospects. Dividend cover has been also further supported by a reduction in the Investment Manager's fee amounting to approximately £1.8 million per annum.

The Company will break a pro-rata proportion of its interest rate swap which will crystallise a break cost of approximately £1 million based on current swap rates, to be paid from cash held outside the security pool. This break cost is slightly below the apportioned provision in the Company's net asset value as at 31 December 2011.

The Company's net loan-to-value following the debt repayment is 41.20%, based upon the independent property valuations as at 31 December 2011.

Commenting, Duncan Owen said:

"The completion of the West Bromwich disposal crystallises a significant gain over acquisition cost for the Company and allows us to reduce debt and the Group's interest costs. Following the debt repayment the Company will be left with sufficient levels of surplus capital to consider making opportunistic new acquisitions, invest capital expenditure in accretive asset management of the existing portfolio and make possible further debt repayments."

-ENDS-

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