Acquisition

RNS Number : 4440V

NewRiver Retail Limited

18 April 2016

 

NewRiver Retail Limited

("NewRiver" or "the Company")

£120m Acquisition of South East London Shopping Centre and Retail Park

Largest Single Asset Acquisition to Date

NewRiver Retail Limited (AIM: NRR), the UK REIT specialising in value-creating retail property investment and active asset management, announces that it has completed the acquisition of The Broadway Shopping Centre and Broadway Square Retail Park in Bexleyheath, south east London (the "Bexleyheath assets") for a total consideration of £120.25 million, equating to a net initial yield of 6.7% and an equivalent yield of 7%, with net rental income at purchase of £8.16 million per anum.

The acquisition is a rare opportunity to acquire high-quality retail assets in the Greater London area at an attractive price, representing approximately 95 basis points above the 15-year average IPD non-central London retail net initial yield of 5.75%. The assets have been acquired from an institutional vendor, using existing cash resources.

The Bexleyheath assets are 100% occupied, reflecting high demand from retailers, and provide a strong range of convenience, food and fashion retailers in line with NewRiver's wider portfolio. In total, the Bexleyheath assets comprise 525,000 sq ft of prominent retail space across an eleven-acre site with an average WALE of 12.65 years. Comprising over 60% of the town's retail space, the Bexleyheath assets provide the principal retail destination for a large area of south east London and north west Kent, and attract over 9 million shoppers per annum.

The Broadway Shopping Centre is anchored by high quality retailers such as Marks and Spencer, H&M, New Look, Argos and Boots. The adjacent Broadway Square Retail Park includes tenants such as Sainsbury's, Poundland, JD Sports and TK Maxx.

The Bexleyheath assets benefit from an affluent and growing population which will be further sustained and supported by major regeneration and infrastructure projects including Thames Gateway, Europe's largest regeneration project, which will provide 160,000 new homes in the area to meet rapidly growing demand and direct access to Abbey Wood Crossrail station expected to be operational in 2018.

The acquisition further demonstrates the Company's ability to swiftly deploy new capital raised and deliver on its business model by acquiring strategically selected retail assets that will generate attractive cash on equity returns with identifiable opportunities to deliver income and capital growth through the Company's active asset management and risk-controlled development.

David Lockhart, NewRiver Retail Chief Executive Officer, commented:

"The acquisition represents our first significant acquisition within the M25 and is our largest single shopping centre acquisition to date. This is an excellent addition to our portfolio and we are confident that our proven active asset management model will drive significant long term value for our shareholders."

"Following the acquisition of the Neptune shopping centre portfolio in January this year for £108 million, this second major acquisition deploys the majority of the proceeds of our £150 million equity raise completed in January 2016, demonstrating our ability to swiftly deploy fresh capital for strategically selected assets that meet our returns criteria."

"The acquisition also reflects the growing scale and financial strength of the Company in that we have now acquired two £100 million plus retail assets on our own balance sheet since the start of this year."

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NewRiver Retail Limited  David Lockhart, Chief Executive Mark Davies, Finance Director	Tel: [phone]
Bell Pottinger David Rydell / James Newman / David Bass	Tel: [phone]
Liberum Richard Crawley / Jamie Richards	Tel: [phone]
Peel Hunt LLP Capel Irwin	Tel: [phone]

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.

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 £1 billion principally comprising 32 UK wide shopping centres, further nationwide retail assets and a portfolio of 358 pubs with retail and mixed-use extension opportunities. The portfolio has over 1,440 occupiers, a total of 7 million sq. ft., total annual footfall of 146 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  

 

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