TIDMNRR
RNS Number : 8752D
NewRiver Retail Limited
12 July 2016
NewRiver Retail Limited
("NewRiver" or the "Group" or the "Company")
12 July 2016
First Quarter Company Update
Strong start to the financial year with a highly active first
quarter
Improved retail occupancy of 97%
Robust business model well positioned to capitalise on market
opportunities
NewRiver Retail Limited (AIM: NRR), the UK REIT specialising in
value-creating retail property investment and active asset
management, announces the following Company update for the first
quarter, beginning 1 April 2016 and ending 30 June 2016.
David Lockhart, Chief Executive at NewRiver Retail, said:
"It has been another successful period for the Company and we
are delighted to be delivering a first quarter dividend of 5 pence,
an 11% increase year on year. Operationally the business continues
to perform well, with 90 leasing events completed during the
quarter and occupancy, lease length and footfall all improving in
the period. We have made good progress on our Co-operative
convenience store development programme, having delivered the first
three stores with the next five under construction. Across the
portfolio we have made further progress on our developments,
securing planning consent to re-position the Montague Centre in
Worthing into a vibrant restaurant quarter.
We founded the Company in 2009, during a severe recession, and
since then we have consistently created value for our shareholders
through our proven business model, focusing on the
non-discretionary convenience-led retail sector where the UK
household budget is spent day in, day out. We believe that
consumers are ultimately price-driven and with our convenience-led
specialism, strong operational metrics, rigorous cost-control and
conservative balance sheet we feel well-positioned to withstand
market uncertainties following the EU referendum result.
Importantly, since the referendum the business has remained
active, progressing a number of leasing deals with major national
retailers who are continuing to take space as planned. Finally, and
significantly, yesterday we signed a new improved debt and
refinancing facility for GBP85.3 million with a US based
institutional lender, further endorsing our business model and
reducing our interest costs."
HIGHLIGHTS
-- Acquisitions totalling GBP140 million including Broadway
Shopping Centre and Broadway Square Retail Park in Bexleyheath for
GBP120.25 million, equivalent yield of 7%; and Cuckoo Bridge Retail
Park, Dumfries for GBP20.2 million, equivalent yield of 7.9%. The
Bexleyheath acquisition was part funded by a new GBP49 million debt
facility from DekaBank at an all in cost of 2.1%.
-- Disposals totalling GBP1.2 million through the sale of two
pubs, delivered 39% above purchase price and 10% above March 2016
valuation, at IRR's of 54% and 98%.
-- Assets under management now total GBP1.2 billion (31 March
2016: GBP1.1 billion) across a total area of 8 million sq ft.
-- Rent roll under management totals GBP107.5 million pa (31 March 2016: GBP95.5 million).
-- Improved Weighted Average Lease Expiry ("WALE") for the
retail portfolio of 7.4 years (31 March 2016: 7.2 years).
-- Increased retail occupancy rate to 97% (31 March 2016: 96%).
-- Like-for-like Q1 footfall marginally improved compared with
Q1 2016 (national benchmark down 1.5%).
-- Affordable average retail rent of GBP12.66 per sq ft (31 March 2016: GBP12.14 per sq ft).
-- Occupier demand remains strong for the Company's
convenience-led portfolio with Q1 delivering 90 leasing events, of
which 43 were long-term new lettings and lease renewals securing
annual rent of GBP1.65 million, 3.2% ahead of valuer's ERV with an
average lease length of 9.9 years.
-- The portfolio's top 15 retailers (by rental income) continue
to be underpinned by successful national retailers including ASDA,
B&M, Boots, New Look, Poundland, Primark, Sainsbury's,
Superdrug and Wilkos.
-- Following the acquisition of Cuckoo Bridge Retail Park,
Dumfries the portfolio includes 22 retail warehouses and the
Company continues to drive performance through its active asset
management and risk-controlled development, creating value through
rental uplift and valuation growth.
-- Good progress across the Company's 1.5 million sq ft
mixed-use development pipeline including:
-- A planning application was submitted in Canvey Island to
create a 65,000 sq ft retail park and a pre-application was
submitted in Cardiff ahead of a major 150,000 sq ft retail and
leisure re-development at the Capitol Shopping Centre. Four
consents were secured in the retail portfolio in Coalville,
Erdington, Fareham and most notably at the Montague Centre in
Worthing where A3 consent was granted to re-position 20,000 sq ft
of existing space at the shopping centre into a restaurant quarter
with leading national operators.
-- First three Co-operative convenience stores now handed over
and trading, securing an annual rent of GBP195,000 across 11,600 sq
ft; on-site for a further five stores. Further progress continues
with 49 convenience store planning applications submitted and 30
convenience store planning consents secured to date.
-- Value-creating residential development continues to progress
well within the pub portfolio to create 150 residential units. To
date we have submitted 32 planning applications and secured 11
consents to provide 26 residential units.
-- Site and car park works are underway in Wallsend, forming the
first phase of the new Forum Retail Park, part of phase two of the
ongoing development. Works are due to complete in August 2016 when
the site will be handed over to Aldi to build a new 18,500 sq ft
unit having paid a premium of GBP1.65 million for a 999 year lease
and to Burger King, to construct a 1,450 sq ft drive-thru pod on a
10 year lease at GBP60,800 pa with turnover top up.
-- Excellent progress at the Abbey Centre Newtownabbey, with
construction of the new 43,000 sq ft Next anchor store due to hand
over in August 2016 and works for the Dunnes extension to create a
31,600 sq ft unit due to commence late summer. Revitalisation works
including a brand re-launch, improved car-parking, signage and
wayfinding together with three further new lettings continues to
create value at the centre.
-- Dividend increased by 11% in the first quarter to 5 pence per
share (Q1 FY16: 4.5p), payable on the 19 August 2016 to
shareholders on the register on 22 July 2016. The ex-dividend date
will be 21 July 2016. The increase in quarterly dividend
demonstrates the Company's commitment to shareholders and
confidence in the business model.
-- Secured an GBP85.3 million debt facility with a major US
insurance company, replacing an existing GBP63 million facility.
The facility improves the financing provided when the Company
acquired 202 pubs from Marston's Plc in November 2013. Under the
revised terms, the facility amount has increased to GBP85.3 million
of which GBP70 million is available to draw immediately, the bank
margin is reduced by 30% and the loan maturity is extended to
2021.
The Company is making good progress in its move up to the Main
Market and obtaining a Premium Listing and is on track to complete
this by September 2016.
ENDS
For further information
NewRiver Retail Limited Tel: 020
David Lockhart, Chief Executive 3328 5800
Mark Davies, Finance Director
Will Hobman, Head of Investor
Relations
Bell Pottinger Tel: 020
David Rydell / James Newman 3772 2500
/ David Bass / Eve Kirmatzis
Liberum Tel: 020
Richard Crawley / Jamie Richards 3100 2000
Peel Hunt LLP Tel: 020
Capel Irwin / Edward Fox 7418 8900
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. NewRiver Retail was named
Property Company of the Year at the 2016 Property Week 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 GBP1.2 billion principally comprising 33 UK wide shopping
centres, further nationwide retail assets and a portfolio of 356
pubs with retail and mixed-use extension opportunities. The
portfolio totals over 8 million sq. ft. with almost 2,000
occupiers, an annual footfall of 150 million and a retail occupancy
rate of 97 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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