TIDMNRR
RNS Number : 0933K
NewRiver Retail Limited
24 December 2015
NewRiver Retail Limited
("NewRiver" or "the Company")
Swift deployment of majority of proceeds of GBP150 million
equity raise
Acquisitions totalling GBP108 million for four shopping centres
and
two retail warehouses an average yield of 8%
NewRiver Retail Limited (AIM: NRR), the UK REIT specialising in
value-creating retail property investment and active asset
management, announces that it has exchanged contracts to acquire
the Neptune Portfolio (the "Portfolio") for a total consideration
of GBP92.3 million, equating to a net initial yield of 8.0%, an
equivalent yield of 9.6% and a reversionary yield of 10.5%.
NewRiver has also completed the acquisition of three further
retail assets for a combined total of GBP15.6 million at a blended
net initial yield of 7.3%.
The acquisitions will be funded utilising a portion of the funds
to be raised following completion of the Company's proposed
conditional placing of 46,153,846 new ordinary shares which is
intended to raise gross proceeds of approximately GBP150 million,
as announced on 10 December 2015 (the "Placing").
These acquisitions demonstrate the Company's proven ability to
swiftly deploy funds 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
capital growth through the Company's active asset management and
risk-controlled development.
The Neptune Portfolio
NewRiver has exchanged contracts to acquire the Neptune
Portfolio for a total consideration of GBP92.3 million, equating to
a net initial yield ('NIY') of 8%, an equivalent yield of 9.6% and
a reversionary yield of 10.5%. The Portfolio, assembled between
2005 and 2006, was acquired in the market at a then combined total
of GBP312 million.
This geographically diverse portfolio comprises three assets:
the Ridings Shopping Centre, Wakefield in West Yorkshire; the
Cornmill Shopping Centre, Darlington in the North East of England;
and the Capitol Shopping Centre, Cardiff in South Wales.
The Portfolio has been acquired significantly below replacement
cost and comprises 727,000 sq. ft. of multi-use lettable space
combining retail and leisure units currently let to strong anchor
retailers. The portfolio is highly reversionary with a combined
reversionary yield of 10.5%, a high occupancy of 96% generating a
strong and a sustainable income stream underpinned by a WALE of
5.30 years.
The Portfolio benefits from a range of high quality retailers
and anchor stores, complementary to the Company's existing
portfolio, including Next, Primark, Tesco, Morrisons, TK Maxx, Easy
Gym and Boots and attracts a combined annual footfall of 22
million. Existing total net income for the portfolio is GBP7.75
million per annum with affordable average rents of GBP11.80 per sq.
ft. offering excellent opportunities for future income growth.
The Portfolio presents significant asset management, extension
and development opportunities following a period of under
investment. Initiatives include the reconfiguration of units to
create more attractive units appropriate to retailer demand,
improvements to the existing retail mix, and specifically, the
repositioning of the Capitol Shopping Centre as a leading food and
leisure destination.
Three further acquisitions in Daventry, York and Penge in
South-East London
In addition to the acquisition of the Neptune Portfolio,
NewRiver has completed the acquisition of three further retail
assets comprising one shopping centre in south-east London and two
retail warehouses for a combined total of GBP15.6 million, at a net
initial yield of 7.3%.
These comprise: Blenheim Shopping Centre in Penge, in the London
Borough of Bromley for GBP6.85 million (NIY: 6.2% and equivalent
yield of 7.9%); Daventry Retail Park in Northamptonshire for a
consideration of GBP4.1 million (NIY: 8.5% and equivalent yield of
10.5%); and a retail warehouse adjacent to the Clifton Moor Retail
Park in York for GBP4.65 million (NIY: 7.9% and equivalent yield of
7.9%) currently let to discount retailer B&M. The three retail
assets each offer excellent value-enhancing asset management and
development opportunities.
Further details of the acquisitions are included in the Notes to
editor below.
David Lockhart, CEO at NewRiver Retail, said:
"Following our recently over-subscribed GBP150 million equity
raise, we are delighted to announce the swift deployment of the
majority of the proceeds into these strategic acquisitions. The
Neptune Portfolio marks another major shopping centre portfolio
acquisition for NewRiver and the combined acquisitions present a
range of immediate value-enhancing asset management and risk
controlled development opportunities. We are confident that these
acquisitions will add significant long term value for our
shareholders."
- ends -
NewRiver Retail Limited
David Lockhart, Chief Executive Tel: 020 3328 5800
Mark Davies, Finance Director
Bell Pottinger Tel: 020 3772 2500
David Rydell / James Newman / David Bass
Liberum
Richard Crawley / Jamie Richards Tel: 020 3100 2000
Peel Hunt LLP
Capel Irwin / Hugh Preston Tel: 020 7418 8900
Notes to editors
The six assets acquired include the following investment
properties:
The Ridings Shopping Centre, Wakefield
- Covered multi-level shopping centre with 10 million annual
footfall and primary catchment population of 309,000
- 320,000 sq. ft with a 1,070 space landlord controlled car park
- WALE of 6.08 years
- Equivalent yield of 13.5%
- Reversionary yield of 15.5%
- Key retailers: Primark, Morrisons, TK Maxx, Marks & Spencer and BHS
Cornmill Shopping Centre, Darlington
- Dominant Shopping Centre with balanced retail offer and strong
occupier demand with a catchment population of 311,000 and annual
footfall of 6 million
- 242,000 sq. ft with a 400 space landlord controlled car park
- WALE 4.91 years
- Equivalent yield of 7.6%
- Reversionary yield of 7.8%
- Key retailers: Primark, Next, Topshop, Waterstones and Superdrug
Capitol Shopping Centre, Cardiff
- Substantial city centre site extending to 2.6 acres benefiting
from annual footfall on Queen Street of 30 million
- 167,000 sq. ft with 388 parking bays
- WALE 5.05 years
- Equivalent yield of 11.1%
- Reversionary yield of 11.7%
- Key retailers: Tesco Metro, EasyGym, Hobbs, Boots, Poundworld,
Café Nero and Pret-a-Manger
Blenheim Shopping Centre, Penge
- Located in the London Borough of Bromley with strong transport links into Central London
- Opportunity for risk controlled extension and development
- Four units totalling 43,000 sq. ft of retail space
- The centre is served by a 216 space multi-storey car park over
three floors accessed from the centre
- WALE 6.46 yrs
- Equivalent yield of 7.9%
- Reversionary yield of 8.99%
- Key retailers: Wilkinsons, Iceland and Peacocks
Daventry Retail Park, Northamptonshire
- Property is held on a freehold basis and is located 15 miles
west of Northampton and 19 miles south east of Coventry
- Asset management and extension opportunities to create new units
- Gross internal area of 23,000 sq ft with 200 parking bays
- Let to Cemex Investments
- WALE 6.76 yrs
- Equivalent yield of 10.5%
- Reversionary yield of 11.65%
Retail Warehouse adjacent to the Clifton Moor Retail Park in
York
- Located adjacent to Clifton Moor Retail Park which is the 4th largest retail park in the UK
- Core holding for retail warehousing portfolio with secure
income stream given the successful trading performance of
B&M
- Asset management opportunities to re-gear
- 25,000 sq ft benefiting from 95 customer car spaces
- WALE 2.71 yrs
- Equivalent yield of 7.9%
- Reversionary yield of 7.9%
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. At the close of 2014
NewRiver Retail was named Property Company of the Year - Retail
& Leisure at the Estates Gazette Awards.
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 GBP1 billion principally comprising 29 UK wide shopping centres,
further nationwide retail assets and a portfolio of 359 pubs with
retail and mixed-use extension opportunities. The portfolio has
1,440 occupiers, a total of 6.4 million sq. ft., total annual
footfall of 126 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
This information is provided by RNS
The company news service from the London Stock Exchange
END
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