Schroder Real Estate Investment Trust Ltd - Disposal of Wickes Retail Warehouse in Basingstone

For release 7 March 2019

Schroder Real Estate Investment Trust Limited
("SREIT"/ the "Company" / "Group")

DISPOSAL OF WICKES RETAIL WAREHOUSE IN BASINGSTOKE

Schroder Real Estate Investment Trust, the actively managed UK-focused REIT, announces that it has exchanged unconditional contracts to sell the Wickes retail warehouse in Basingstoke for £12 million. The price compares to the independent valuation as at 31 December 2018 of £12.5 million and reflects a net initial yield of 5.4%. The disposal is scheduled to complete on 29 March 2019.

The property comprises a modern retail warehouse unit totalling 35,290 sq ft let to Wickes Building Supplies Limited for a further fourteen years at £692,250 per annum or £19.50 per sq ft. The lease has upwards only open market rent reviews. Wickes are currently SREIT's third largest tenant overall and its largest retail tenant. Following the disposal of the subject property, it will become the Company's fourteenth largest tenant overall with a retail warehouse in Chester let for 14 years at £400,000 per annum.

Based on the disposal price, the asset has generated an ungeared total return of 7.5% per annum since acquisition in 2007 compared with the MSCI Benchmark for the same period of 4% per annum.

The disposal is consistent with SREIT's strategy to sell lower yielding retail assets that offer limited upside from asset management. Following completion of the disposal, and based on the independent portfolio valuation as at 31 December 2018, SREIT's consolidated net loan to value falls from 29% to 27%.

The additional cash, reduced loan to value and undrawn revolving credit facility provides SREIT with operational flexibility to monitor the market and consider opportunistic new investments in the future.

-ENDS-

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