REGIONAL REIT Limited

(“Regional REIT”, the “Group” or the “Company”)

AGM Trading Update

Regional REIT Limited (LSE: RGL), the regional property specialist, announces the following trading update for the quarter from 1 April 2024 to 30 June 2024.

Summary of activity in the quarter to 30 June 2024

Lettings

Since 1 April 2024, the Group has made strong progress on lettings, exchanging on six notable leases to new tenants totalling 69,067 sq. ft., amounting to £0.7m per annum (“pa”) of rental income when fully occupied, achieving an average rental uplift of 11.0% against December 2023 ERVs. A further seven leases have renewed amounting to 47,000 sq. ft. and £0.6m pa of rental income.

Sales

Three disposals (plus one part sale) were completed in the quarter to 30 June 2024 with sales proceeds amounting to £6.9 million (before costs), reflecting a net initial yield of 9.6%.

Stephen Inglis, CEO of London & Scottish Property Investment Management, Asset Manager commented:

“During the quarter we were pleased to achieve further progress in the Group’s letting activity and disposal programme, with £0.7m of additional notable rental income from new leases and £6.9 million generated from recent disposals.

As announced on 18 July 2024, the successful capital raise of £110.5m ensures the repayment of the retail bond, facilitate the further reduction of the LTV to 40.6%, and will provide for accretive capital expenditure on assets for the long term.”

Rental Updates

·    Ashby Park, Ashby De La Zouch – Ashfield Healthcare Ltd. has let 18,942 sq. ft. of office space to July 2034, with an option to break in 2029, at a rental income of £350,427 pa (£18.50/ sq. ft.).

·    Central Park, New Lane, Leeds – QBE Management Services (UK) Ltd renewed its existing leases to June 2025, at a combined rental income of £297,390 pa (£13.79/ sq. ft.) on 21,570 sq. ft. of space, and also renewed its car parking lease for an additional £10,000 pa.

·    1175 Century Way, Thorpe Park, Leeds – Fonemedia Ltd has let 3,524 sq. ft. of office space to May 2029, with an option to break in 2027, at a rental income of £84,576 pa (£24.00 / sq. ft.).

·    1-6 Silver Court, Welwyn Garden City – Telespazio UK Ltd has let 3,873 sq. ft. of office space to April 2027, with an option to break in 2025, at a rental income of £67,800 pa (£17.51/ sq. ft.).

·    84 Albion Street, Leeds – Jugo Digital Ltd has let 1,304 sq. ft. of office space to April 2027, with an option to break in 2025, at a rental income of £66,000 pa (£50.61/ sq. ft.).

·    Cardiff Gate Business Park, Cardiff – SMS Energy Services Ltd. renewed its lease to February 2025, at a rental income of £61,908 pa (£14.00/ sq. ft.) on 4,422 sq. ft. of space.

·    York House, Felixstowe – Existing tenant Poundland Ltd has renewed existing lease of 7,593 sq. ft. of space at a rental income of £60,000 (£7.90/ sq. ft.). The lease is to April 2027.

·    Templeton On The Green, Glasgow – National Society For The Prevention Of Cruelty To Children. renewed its lease to March 2025, at a rental income of £59,820 pa (£12.00/ sq. ft.) on 4,985 sq. ft. of space.

·    Oakland House, Manchester – Secretary of State for Levelling Up, Housing & Communities renewed its lease to June 2029, with the option to break in 2027, at a rental income of £59,500 pa (£10.92/ sq. ft.) on 5,450 sq. ft. of space.

·    Eagle Court, Coventry Road, Birmingham – Goldbeck Construction Ltd has let 2,863 sq. ft. of office space to May 2025, with an option to break in 2024, at a rental income of £51,534 pa (£18.00/ sq. ft.).

·    Murdostoun House, Strathclyde Business Park, Bellshill – ATPAC Ltd has let 3,229 sq. ft. of office space to June 2029, with an option to break in 2027, at a rental income of £41,982 pa (£13.00/ sq. ft.).

·    Beaufort Office Park, Bristol – St John Ambulance renewed its lease to May 2028, with the option to break in 2026, at a rental income of £49,170 pa (£16.50/ sq. ft.) on 2,980 sq. ft. of space.

Subsequent Events summary post 30 June 2024

Since the quarter end, the Group has successfully completed a £110.5m capital raise ensuring the repayment of the £50m retail bond, enabling the reduction of bank facilities by £26.3m, and providing £28.4m for identified accretive capital expenditure projects.

Lettings

·    1175 Century Way, Thorpe Park, Leeds – Greenbelt Group Ltd has let 2,670sq. ft. of office space to July 2029, at a rental income of £64,080 pa (£24.00 / sq. ft.).

Forthcoming Events

5 Aug 202410 Sep 202413 Nov 2024 Annual General MeetingInterim Results AnnouncementQ3 2024 Trading Update