ACCRETIVE ACQUISITIONS TOTALLING £57M AT 5.25% NIY
21 February 2022
LXi REIT plc
(the "Company" or the "Group")
ACCRETIVE ACQUISITIONS TOTALLING £57 MILLION AT 5.25% NIY
The Board of LXi REIT plc (ticker: LXI), th e specialist inflation-protected long income REIT, is pleased to announce the following acquisitions, funded by its recent £250 million equity capital raise (the "Capital Raise").
The acquisitions, which have been transacted on an off-market basis, total £57 million and reflect an accretive 5.25% net initial yield (net of purchase costs), versus the current portfolio valuation yield of 4.5%. The assets are secured to strong tenant covenants on long-term, index-linked leases and are underpinned by affordable rents.
The Company has now deployed £144 million since the Capital Raise which closed on 9 February. The Company is in solicitors' hands on a range of additional assets and further announcements are expected to be made shortly.
BT forward funding
The Company has acquired, by means of a pre-let forward funding, a 77,000 sq ft office in Dundee.
The property has been fully pre-let to BT Group plc on a new, unbroken 17.5 year lease, with five yearly CPI inflation linked rental uplifts, capped at 3% per annum and collared at 1% per annum compounded.
The property, which will house BT's critical infrastructure to handle emergency 999 telephone calls, will be built to a BREEAM Excellent standard, with an EPC target rating of A, and the development will include rooftop solar and EV charging points.
BT Group plc is a FTSE 100 constituent with a market cap of approximately £19 billion.
Full planning consent is in place, the Agreement for Lease has been exchanged and the property is being funded on a fixed price basis. The Company will receive a cash-backed income from the developer during the construction period in line with the purchase yield.
Cazoo sale and leaseback portfolio
The Company has acquired five customer service, car storage and repair and maintenance facilities in Chertsey, Northampton, Newcastle, Carlisle and Cardiff, by means of a sale and leaseback with Cazoo.
Each property is fully let to Cazoo Limited on a new, unbroken 20-year lease with five yearly CPI linked rental uplifts, capped at 4% per annum and collared at 2% per annum compounded.
Cazoo is a leading online car retailer, listed on the NYSE, with a market cap of approximately $3.4 billion.
FOR FURTHER INFORMATION, PLEASE CONTACT:
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LXI REIT Advisors Limited Simon Lee (Partner, Fund Manager) John White (Partner, Fund Manager) |
Via Maitland/AMO |
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Peel Hunt LLP Luke Simpson/Liz Yong |
020 7418 8900 |
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J efferies International Ed Matthews/Tom Yeadon |
020 7029 8000 |
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Maitland/AMO (Communications Adviser) James Benjamin/Alistair de Kare-silver |
020 7379 5151 |
The Company's LEI is: 2138008YZGXOKAXQVI45
NOTES:
LXI REIT plc invests in UK commercial property assets let, or pre-let, on very long (typically 20 to 30 years to expiry or first break), inflation-linked leases to a wide range of strong tenant covenants across a diverse range of robust property sectors.
The Company may invest in fixed-price forward funded developments, provided they are pre-let to an acceptable tenant and full planning permission is in place. The Company will not undertake any direct development activity nor assume direct development risk.
The Company is targeting a dividend of 6.3 pence per ordinary share for the year commencing on 1 April 2022 and a dividend of 6 pence per ordinary share for the year which commenced on 1 April 20211.
The Company, a real estate investment trust ( " REIT " ) incorporated in England and Wales, is listed on the premium listing segment of the Official List of the UK Listing Authority and was admitted to trading on the main market for listed securities of the London Stock Exchange in February 2017.
The Company is a constituent of the FTSE 250, EPRA/NAREIT and MSCI indices.
Further information on the Company is available at www.lxireit.com
1 These are guidance levels or targets only and not a profit forecast. In setting this target the Board has applied sensitivities to contracted rental income that reflect the possible impact of the Covid-19 pandemic and assessed the effect of such sensitivities on the net earnings and liquidity of the Group. The target assumes that future rent collection is not materially lower than that achieved so far throughout the pandemic and the Board reserves the right to withdraw or amend guidance in the event that rent collection materially worsens.
There can be no assurance that this target will be met, and it should not be taken as an indication of the Group's expected future results which may be impacted by events or circumstances existing or arising.
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