Strategic Partnership

10 November 2014

Grainger plc ("Grainger", the "Group", "Company")

GRAINGER AND SIGMA CAPITAL GROUP PLC ENTER INTO STRATEGIC PARTNERSHIP TO DELIVER REGIONAL PRS DEVELOPMENTS

Grainger, the UK's largest listed residential property owner and manager, today announces that it has signed an agreement with Sigma Capital Group plc ("Sigma"), the residential and urban regeneration specialist, which grants Grainger the exclusive option for an initial four year term to acquire development opportunities of 100 units or more sourced by Sigma, to create a large-scale Private Rented Sector ("PRS") portfolio across the key cities of England outside Greater London.

Under the agreement, Grainger will appraise each development opportunity individually. A number of sites have already been identified that Grainger and Sigma are looking to progress.

At present, Grainger expects to fully own the initial developments sourced by Sigma, although in the future it may also seek to syndicate its investment to third party investors, which could include Sigma. Sigma, in addition to sourcing development opportunities, is expected to act as development manager on the majority of projects and will earn a profit share on each development, split into a sourcing fee and a development management fee.

Andrew Cunningham, Chief Executive of Grainger plc, said: "This agreement leverages both Sigma's excellent relationships with Local Authorities and housebuilding partners across the UK and Grainger's proven track record in managing residential property, whilst providing an innovative new avenue for investment. We are at the forefront of the private rented sector and remain committed to delivering high quality new homes, benefitting local communities whilst delivering shareholder value."

Graham Barnet, Chief Executive of Sigma, commented: "The creation of this strategic partnership with Grainger is tremendously exciting, marking another milestone development for Sigma as it positions itself as a major presence in the delivery of high quality new homes for the rental sector.

"The partnership enables us to accelerate the delivery of large scale PRS schemes throughout the UK, particularly in England's major cities outside London. This acceleration of our activities will help further expand the breadth of opportunity with our partners as we deliver on this. The combination of Grainger's funding ability and asset and property management expertise, and our local authority relationships and development management skills, brings gains to both sides - as well as to our associated partners.

"We are already appraising our first schemes and look forward to rolling out this programme with our new partner, Grainger, in due course."

Grainger will announce its results for the year ended 30 September 2014 on Thursday 20 November 2014.

ENDS

For further information:

Grainger plc

Kurt Mueller, Director of Corporate Affairs

Tel: +44 (0) 207 940 9500

FTI Consulting

Dido Laurimore/ Nick Taylor/ Ellie Sweeney

Tel: +44 (0) 20 3727 1000

About Grainger plc

Grainger plc is the UK's largest listed residential property owner and manager, with c £2.8bn of residential assets under management across the UK and Germany. Grainger generates income through:

· Sales of properties when they achieve optimum valuations

· Rent from its portfolio of tenanted properties

· Fees for the management of residential properties and the provision of its expert services to select third party clients.

Additionally, Grainger is a leading provider of equity release products through its award-winning subsidiary brand, Bridgewater Equity Release.

Grainger was established in 1912 in Newcastle upon Tyne, where it remains headquartered. Grainger is a constituent of the FTSE 250 on the London Stock Exchange and the FTSE4Good index. Grainger was awarded the UK's Residential Asset Manager of the Year at the RESI Awards in 2014, 2013 and 2012.

For more information on Grainger visit: www.graingerplc.co.uk.