SREI Schroder Real Estate Investment Trust Limited

For release 14 September 2020

Schroder Real Estate Investment Trust Limited

("SREIT"/ the "Company" / "Group")

ASSET MANAGEMENT AND RENT COLLECTION UPDATE

Schroder Real Estate Investment Trust, the actively managed UK-focused REIT, provides an update on recent asset management activity across its portfolio. This follows the Company’s recent announcement regarding the commencement of a share buyback programme.

13 new lettings, renewals and reviews have completed across the portfolio since 30 June 2020.  This positive activity increased contracted rental income by £210,000 per annum compared with the position at 30 June 2020 and totals £800,000 of rent.  The activity included the following:

Leeds, Coverdale House (Office)

• New lease completed for a three year term to the Secretary of State for Housing, Communities and Local Government for a 17,578 sq ft family court at £15.00 per sq ft equating to £281,670 per annum.  The rental level achieved is in-line with the independent estimated rental value (‘ERV’) and represents a 6% increase to the previous passing rent of £265,000 per annum.

Multi-let industrials

• Nine new lettings, renewals and rent reviews have completed at the Company’s multi-let industrial estates in Milton Keynes, Leeds and Norwich. This activity equates to a total annualised rent of £360,000 and generated additional contracted rental income of £180,000 per annum compared with the position at 30 June 2020.  Key activity included:
  • Milton Keynes, Stacey Bushes Industrial Estate - New ten year lease to Goodman Precision Engineering Limited, a racing engineering company, for two units totalling 10,861 sq ft at £7.50 per sq ft equating to £81,500 per annum. This is 15% ahead of ERV and the previous passing rent. The tenant will receive seven months rent free and there is a break option in year five.
  • Milton Keynes, Stacey Bushes Industrial Estate – Lease renewal with The Saab Centre for a new ten year lease at a rent of £32,300 per annum, or £8.50 per sq ft, compared with previous rent of £17,715 per annum.  This represented an 82% increase in rent and is 22% ahead of ERV.

Rent collection

• The rent collected that was payable in June 2020 for the period ending 30 September 2020 currently totals 82% of contracted rents.  The breakdown between sectors for rent collection is 95% of Office collected, 92% of Industrial collected, 53% of Retail and Leisure collected, and 100% of Other collected. The Company remains in active dialogue with its tenants for all rents due to be paid.

Balance sheet and buy-back

• As at 30 June 2020, the Company had cash of £85.4 million resulting in a loan to value ratio, net of cash, of approximately 24%.  
• On 8 September the Company announced a share buy-back programme. The Board  believes that investment in the SREIT’s shares at the prevailing price and discount to net asset value offers attractive value for its shareholders. Alongside share buy-backs the focus continues to be on identifying attractive new acquisitions and delivering net income growth through new lettings and asset management.

Material valuation uncertainty clause

• The Company has been informed by the independent valuers that the industry-wide material valuation uncertainty clause is to be removed for the next valuation on 30 September 2020.

-ENDS-

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