Shareholder Update and Dividend Declaration

AEW UK REIT PLC

28 October 2026

 

28 October 2026

AEW UK REIT plc

Shareholder Update

AEW UK REIT plc (LSE: AEWU) ("AEWU" or the "Company"), which directly owns a value-focused, diversified portfolio of 33 UK commercial properties, announces its shareholder update and unaudited Net Asset Value ("NAV") as at 30 September 2026.

Highlights

         NAV of £170.50 million or 107.45 pence per share as at 30 September 2026 (30 June 2026: £171.05 million or 107.80 pence per share).

         NAV total return of 1.53% for the quarter (30 June 2026 quarter: 1.31%).

         Shareholder total return of 0.57% for the quarter (30 June 2026 quarter: 7.47%).

         0.09% like-for-like portfolio valuation decrease for the quarter (30 June 2026 quarter: 0.11% increase).

         EPRA earnings per share ("EPRA EPS") for the quarter of 1.78 pence (30 June 2026 quarter: 1.89 pence).

         Interim dividend of 2.00 pence per share for the three months ended 30 September 2026, paid for 44 consecutive quarters and in line with the targeted annual dividend of 8.00 pence per share, representing a dividend yield of 7.8% as at quarter-end.

         Loan to GAV ratio at the quarter end was 25.42% (30 June 2026: 25.33%). Significant headroom on all loan covenants.

         The Company continues to benefit from a low fixed cost of debt of 2.959% until July 2027 and has entered into an interest rate cap to protect against the risk of higher rates when it refinances.

         Positive fair value movement of £422k for the quarter on the interest rate cap derivative, reflecting strong risk management against medium-term rate volatility.

Laura Elkin, Portfolio Manager, AEW UK REIT, commented:

The portfolio’s valuation declined modestly during the quarter; however, capital performance remained positive over the half year, comparing favourably with the 1.1% decline recorded by CBRE’s valuation index over the same period. Despite continued economic headwinds, the Company has delivered robust performance overall, increasingly supported by the active asset management approach for which it is well recognised.

Performance during the quarter was supported by valuation gains in both retail warehousing and high street retail, where recent leasing and occupational activity drove uplifts across several assets. Post period end, Martin Property Group completed the acquisition of NCP and 93 sites out of administration, including Tanner Row, York, underlining the strength of the asset and its underlying trading performance.

Looking ahead, we are encouraged by the depth of attractive, high-yielding opportunities in our investment pipeline across a range of real estate sectors. Over the coming periods, we intend to pursue these through a program of capital recycling, divesting assets where value has been maximised and reinvesting in acquisitions that are accretive to earnings.

We remain confident in AEWU’s strategy and believe the portfolio is well positioned to continue delivering the Company’s investment objective. The Board has announced a dividend of 2.00 pence per share for the 44th consecutive quarter. We continue to work with the Board and advisers to explore opportunities to expand the Company’s equity base where this is in shareholders’ best interests.

Valuation Movement

As at 30 September 2026, the Company owned investment properties with a total fair value of £214.02 million, as assessed by the Company’s independent valuer, CBRE Limited (“CBRE”). The like-for-like valuation decrease for the quarter of £0.19 million (0.09%) is broken down as follows by sector:

Sector	Valuation 30 September 2026		Like-for-like valuation movement for the quarter
	£ million	% of portfolio	£ million	%
Industrial	80.06	37.41	(0.01)	(0.01)
High Street Retail	44.70	20.89	0.45	1.01
Retail Warehouses	30.87	14.42	0.60	1.97
Office	22.54	10.53	(0.68)	(2.93)
Other*	35.85	16.75	(0.55)	(1.48)
Total	214.02	100.00	(0.19)	(0.09)**

* Other comprises three leisure assets, one gym and one mixed-use multi-storey car park.

** This is the overall weighted average like-for-like valuation decrease of the portfolio.

Portfolio Manager's Review

During the quarter, the Company's portfolio recorded a modest like-for-like valuation decline of 0.09%. This follows gains in 13 of the previous 14 quarters,  with the portfolio continuing to outperform the wider market. Over the same period, the CBRE UK Index recorded a capital value decline of 0.9% and a total return of 0.5%.

The industrial sector was broadly flat over the quarter, recording a marginal valuation decline of 0.01%. Asset-level valuation movements were mixed, with Diamond Business Park, Wakefield and Brockhurst Crescent, Walsall recording uplifts on the back of positive occupational momentum. By contrast, at Sarus Court, Runcorn and Apollo Business Park, Basildon, higher construction costs and softer exit yields more than offset recent ERV growth, resulting in valuation declines. On 9 September, Basildon Planning Committee resolved to grant planning consent for the redevelopment of Apollo Business Park into a new prime warehouse extending to 58,588 sq. ft., which the Manager believes will deliver a higher quality, more marketable asset better aligned to current occupational demand.

Both retail warehousing and high street retail delivered valuation gains during the quarter, increasing by 1.97% and 1.01%, respectively. Notable gains were recorded at Arrow Retail Park, Shrewsbury and The Railway Centre, Dewsbury, both within the retail warehousing sector, where ERVs improved following recent leasing activity. The Manager is currently progressing three transactions at these two assets, which have recently entered solicitors' hands and are expected to complete over the coming quarters. Within the high street retail sector, Northgate House, Bath and Above Bar Street, Southampton also saw valuation uplifts following positive occupational activity and a reduction in anticipated landlord capital expenditure.

Following NCP's appointment of joint administrators on 16 March, the valuation of Tanner Row, York was unchanged over the quarter. Post period end, Martin Property Group completed the acquisition of NCP and 93 sites out of administration, including Tanner Row, underlining the asset's strength and underlying trading performance at York. The centrally located 0.8-acre site within York city walls also benefits from alternative use potential. Rent has continued to be received on a monthly basis throughout the administration period.

The office sector, which is the portfolio's smallest weighting at 10.53%, experienced a more challenging quarter as asset management initiatives continue to mature. The portfolio’s office assets recorded a valuation decline of 2.93%, entirely attributable to Queen Square, Bristol, which had, by contrast, delivered a valuation uplift of 7.59% in the quarter ended 31 March. The decline in the current quarter principally reflects the planned refurbishment of 4,589 sq. ft. of space over the coming months, together with the ongoing ramp-up of the IWG managed office offering, (which is currently operating at circa 31% occupancy). With stabilised occupancy projected to reach 80% by year three, the Manager anticipates annual revenue in excess of the current ERV of £418,500 per annum (£35 per sq. ft.). The Manager continues to view upcoming lease events and vacancies as opportunities to grow income and create value. Within the office portfolio, the net initial yield and reversionary yield are 5.32% and 12.15%, respectively.

Following the sale of Circuit, Cardiff (nightclub) on 23 July at a 42% premium to its 31 March 2026 valuation, the leisure sector recorded a like-for-like valuation decline of 1.48% over the quarter, reflecting weaker market sentiment, as evidenced by longer assumed void periods and general yield softening. Notwithstanding these headwinds, the Manager continues to see value in specific leisure assets where occupier trading is strong and capital values are close to, or supported by, alternative use values, with leisure parks in particular benefiting from purpose-built construction, low site density and proximity to urban centres.

Net Asset Value

The Company's unaudited NAV at 30 September 2026 was £170.50 million, or 107.45 pence per share. This reflects a decrease of 0.32% compared with the NAV per share at 30 June 2026. The Company's NAV total return, which includes the interim dividend of 2.00 pence per share for the period from 1 July 2026 to 30 September 2026, was 1.53% for the three-month period ended 30 September 2026.

	Pence per share	£ million
NAV at 1 July 2026	107.80	171.05
Capital expenditure	(0.06)	(0.09)
Valuation change in property portfolio	(0.54)	(0.85)
Valuation change in derivatives	0.27	0.42
Gain on the sale of investments	0.26	0.41
Income earned for the period	2.98	4.73
Expenses and net finance costs for the period	(1.26)	(2.00)
Interim dividend paid	(2.00)	(3.17)
NAV at 30 September 2026	107.45	170.50

The NAV attributable to the ordinary shares has been calculated under International Financial Reporting Standards. It incorporates the independent portfolio valuation at 30 September 2026 and income for the period but does not include a provision for the interim dividend declared for the three-month period to 30 September 2026.

Share Price

The closing ordinary share price at 30 September 2026 was 103.00p, a decrease of 1.34% compared with the share price of 104.40p at 30 June 2026. The closing share price represents a discount to the NAV per share of 4.18% which remains the tightest within the peer group. The Company's share price has subsequently increased back to 104.40p as at close on 27 October 2026, resulting in a tightening of the discount to approximately 2.84%. The Company's share price total return, which includes the interim dividend of 2.00 pence per share for the period from 1 July 2026 to 30 September 2026, was 0.57% for the three-month period ended 30 September 2026.

Dividend

Dividend declaration

The Company today announces an interim dividend of 2.00 pence per share for the period from 1 July 2026 to 30 September 2026. The dividend payment will be made on 4 December 2026 to shareholders on the register as at 6 November 2026. The ex-dividend date will be 5 November 2026. The Company operates a Dividend Reinvestment Plan ("DRIP"), which is managed by its registrar, MUFG Corporate Markets Limited. For shareholders who wish to receive their dividend in the form of shares, the deadline to elect for the DRIP is 13 November 2026.

The dividend of 2.00 pence per share will be designated 2.00 pence per share as an interim property income distribution ("PID").

The Company has now paid a 2.00 pence quarterly dividend for 44 consecutive quarters, providing consistently high levels of income to our shareholders.

Dividend outlook

It remains the Company's intention to continue to pay dividends in line with its dividend policy. In determining future dividend payments, regard will be given to the financial circumstances prevailing at the relevant time, as well as the Company's requirement, as a UK REIT, to distribute at least 90% of its distributable income annually.

Financing

Equity:

At 30 September 2026, the Company's share capital comprised 158,674,746 ordinary shares in issue, with 100,000 shares held in treasury.

Debt:

The Company has a £60.00 million loan facility with AgFe, a leading independent asset manager specialising in debt-based investments. The loan is priced as a fixed rate loan with a total interest cost of 2.959% until July 2027 and was fully drawn at 30 September 2026, producing a Loan to GAV ratio of 25.42%.

Headroom on the debt facility's 60% loan to value ("LTV") covenant continues to be conservative. For those properties secured under the loan, a 52.86% fall in valuation would be required before the LTV covenant were to be breached.

The Manager is already engaged in productive discussions with potential lenders, including the incumbent, well in advance of the term date on the existing debt in July 2027.

As announced on 3 June 2026, the Company bought an interest rate cap to protect against the risk of higher interest rates when its fixed rate debt facility with AgFe expires in July 2027. The cap was acquired as a prudent measure given the uncertainty over the medium-term outlook for interest rates and will run from 20 July 2027 to 20 July 2030 covering £30.0 million of borrowings, equivalent to 50% of the Company's current debt. The Company has paid a one-off premium of £638,000 for the cap, which limits the SONIA rate on the Company's borrowings to a maximum of 4.064% over the three-year term. The capital movement on this hedge arrangement during the period amounted to £422,524, as reflected in the movement in NAV set out in the above table.

Investment Update

During the quarter the Company completed on the following investment transaction:

Circuit, Greyfriars Road, Cardiff (leisure) – On 23 July 2026, the Company completed the sale of Circuit nightclub for £1.475 million (£37 per sq. ft.), reflecting a net initial yield of 14.78%. This represents a circa 42% premium to the 31 March 2026 valuation of £1.035 million (£26 per sq. ft.). The decision to sell was driven by the significant headwinds currently affecting the sector, including changing consumer behaviour, rising operating costs and the introduction of six-month rolling break options from August 2026. Following completion of the sale, the tenant, Neos 13 Ltd, served notice to terminate the lease on 1 August 2027. 

The property was acquired in February 2022 for £3.625 million (£92 per sq. ft.), reflecting a net initial yield of 7.75%, and its value subsequently declined following the previous tenant’s entry into administration in February 2024.

Asset Management Update

The Company completed the following asset management transactions during the quarter:

Apollo Business Park, Basildon (industrial) – On 9 September, planning consent was granted by Basildon Planning Committee for the demolition of the existing 68,813 sq. ft. buildings and their redevelopment into a new prime warehouse extending to 58,588 sq. ft., with a 12.5m internal eaves height, EPC A+ rating and a 40m (in depth) service yard. The existing industrial buildings and ancillary offices are currently occupied by two remaining tenants, generating a combined rent of £257,720 per annum, whose leases expire at the end of March 2027. Neither tenant benefits from security of tenure, such that vacant possession can be obtained readily.

Following Vink UK Ltd vacating in September 2025 and Trafertir International Transport Ltd (Trafertir) confirming its intention to vacate in March 2027, the existing buildings were deemed physically and economically obsolete, with refurbishment considered unviable. Accordingly, the Manager adapted its business plan to secure planning permission for a new prime single warehouse unit with a significantly improved yard, with a view to selling the site to a developer once planning had been secured.

The Company completed a short-term lease renewal with Embassy Freight Services (UK) Ltd at the current passing rent of £16,970 per annum, making the lease coterminous with Trafertir’s lease expiry on 24 March and thereby ensuring that full vacant possession of the site can be secured for redevelopment. 

Carrs Coatings, North Moons Industrial Estate, Redditch (industrial) – The Company settled Carrs Coatings Ltd’s August 2026 annual uncapped RPI rent review at £327,621 per annum, equating to £8.62 per sq. ft., representing an increase of £8,102 per annum (circa 2.5%). The lease was originally entered into in 2008 as part of a sale and leaseback transaction at an initial rent of £170,300 per annum (£4.50 per sq. ft.).

The rent is subject to annual uncapped RPI reviews, with no cap or collar. Carrs Coatings is a leading manufacturer of specialist coatings, with over 125 years of technical and manufacturing experience.

Westlands Distribution Park, Weston-Super-Mare (industrial) – The Company completed the letting of Plot 7B, extending to 0.52 acres, to North Somerset Environment Company Ltd for the storage of materials and vehicles. The tenant has entered into a new three-year lease at a rent of £25,000 per annum and has been granted a three-month rent-free period in return for committing to the lease.

The Company completed a lease renewal with Ford Fuels Limited at a rent of £35,000 per annum. The new lease will expire on 3 September 2029, with no rent-free period or other incentive granted.

London East Leisure Park, Dagenham (leisure) – The Original Bowling Company Limited (trading as Hollywood Bowl) has confirmed that its turnover rent, payable in addition to its contracted rent of £287,922 per annum, is £122,720. This represents the maximum turnover rent achievable under the lease and underlines the strength of the bowling sector, notwithstanding wider headwinds across the leisure market arising from rising operating costs and pressure on discretionary spending.

Tanner Row, York (other) – The Company notes the completion of the sale of NCP to The Martin Property Group (MPG), which has acquired the NCP brand and 93 sites out of administration, including Tanner Row, York. Tanner Row remained operational throughout the administration, with the Joint Administrators continuing to trade from the property and rent being paid monthly. NCP pays annual rent of £733,057 at Tanner Row, representing 4.1 per cent of the Company's total contracted income, equivalent to approximately 0.12 pence per share per quarter. Tanner Row's continued operation through the administration, and its inclusion in the portfolio acquired by MPG, underline the strength of the asset and reflect the Manager's thorough due diligence at acquisition, particularly in relation to occupier performance and underlying trading at York.

The mixed-use asset is centrally located within York city walls, extends to 0.8 acres and benefits from alternative use potential given the land-constrained nature of the location. It was acquired on 19 July 2023 for £10.02 million, reflecting a net initial yield of 9.3%.

Northgate House, Bath (retail) – The Company completed the letting of 28 High Street, comprising 2,375 sq. ft., to Loake Brothers Limited. The tenant has entered into a new 10-year lease, subject to a tenant break option on the fifth anniversary, at a rent of £65,000 per annum, compared with an ERV of £50,000 per annum. In return for committing to the new lease, the tenant has been granted a nine-month rent-free period. The property was let on an “as seen” basis, with no landlord capital expenditure required.

Glossary of Commonly Used Terms

Industry specific terms used in the Company’s communications are defined in the glossary of commonly used terms which can be found on the Company’s website: https://www.aewukreit.com/investors/glossary

AEW UK Laura Elkin Henry Butt	[e-mail] [e-mail]
AEW Investor Relations	[e-mail]
Company Secretary
MUFG Corporate Governance Limited	[e-mail]
Cardew Group	[e-mail]
Ed Orlebar Tania Wild	[phone] [phone]
Panmure Liberum
Darren Vickers	[phone]

Notes to Editors

About AEW UK REIT

AEW UK REIT plc (LSE: AEWU) aims to deliver an attractive total return to shareholders by investing predominantly in smaller commercial properties (typically less than £15 million), on shorter occupational leases in strong commercial locations across the United Kingdom. The Company is currently invested in office, retail, industrial and leisure assets, with a focus on active asset management, repositioning the properties and improving the quality of income streams.  AEWU is currently paying an annualised dividend of 8p per share. 

The Company was listed on the Official List of the Financial Conduct Authority and admitted to trading on the Main Market of the London Stock Exchange on 12 May 2015. www.aewukreit.com

LEI: 21380073LDXHV2LP5K50

About AEW

AEW is one of the world’s largest real estate asset managers with €73.2 billion of assets under management as at 30 June 2026. AEW has over 815 employees globally, with its main offices located in Boston, London, Paris and Hong Kong and offers a wide range of real estate investment products including comingled funds, separate accounts and securities mandates across the full spectrum of investment strategies. AEW represents the real estate asset management platform of Natixis Investment Managers, one of the largest asset managers in the world.

As at 30 June 2026, AEW managed €34.8bn of real estate assets in Europe on behalf of a number of funds and separate accounts. AEW has over 500 employees based in 11 offices across Europe and has a long track record of successfully implementing Core, Value-Add and Opportunistic investment strategies on behalf of its clients. In the last five years, AEW has invested and divested a total volume of over €13bn of real estate across European markets.

www.aew.com

AEW UK Investment Management LLP is the Investment Manager.  AEW is a group of companies that includes AEW Europe and its subsidiaries, as well as affiliated company AEW Capital Management, L.P. in North America and its subsidiaries. AEW Europe, together with its subsidiaries AEW UK Investment Management LLP, AEW S.à.r.l., AEW Invest GmbH, and AEW SAS, is a European real estate investment manager with headquarters offices in Paris and London. AEW Europe and AEW Capital Management, L.P. are owned by Natixis Investment Managers. Natixis Investment Managers is an international asset management group based in Paris, France, that is principally owned by Natixis, a French investment banking and financial services firm. Natixis is principally owned by BPCE, France's second-largest banking group.

Disclaimer

This communication cannot be relied upon as the basis on which to make a decision to invest in AEWU. This communication does not constitute an invitation or inducement to subscribe to any particular investment. Issued by AEW UK Investment Management LLP, 8 Bishopsgate, London, EC2N 4BQ.
Company number: OC367686 England. Authorised and regulated by the Financial Conduct Authority.

 

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