LXI REIT PLC Acquisition (6834L)
July 21 2017 - 1:00AM
UK Regulatory
TIDMLXI
RNS Number : 6834L
LXI REIT PLC
21 July 2017
21 July 2017
LXi REIT plc
(the "Company" or "LXI REIT")
GBP5.0 MILLION ACQUISITION OF TRAVELODGE HOTEL AND BURGER KING
AND LITTLE CHEF RESTAURANTS AT NEEDHAM MARKET, SUFFOLK
The Board of LXi REIT plc (ticker: LXI) is pleased to announce
that the Company has exchanged contracts to acquire the Travelodge
hotel and Burger King and Little Chef restaurants at Needham Market
service station, Ipswich, Suffolk (the "Property"). The purchase
price for the Property is GBP5.0 million, reflecting a net initial
yield of 6.12% on the asset acquisition (net of acquisition
costs).
The hotel and both restaurants are fully let to Travelodge
Hotels Limited, the principal trading company of the Travelodge
group, the UK's largest independent hotel brand, with more than 520
hotels and over 38,000 guest bedrooms, across the UK, Ireland and
Spain.
The lease has an unexpired term of over 20 years (expiring in
October 2037), without a break, and is subject to five yearly
upward only rent reviews index-linked to the Retail Prices Index,
with a high collar and cap of 3% p.a. and 7.5% p.a. compound. The
next rent review is due in January 2020.
The Property comprises a purpose-built 40 bedroom hotel, a
standalone 4,045 sq ft restaurant unit and parking for 81 cars and
forms part of a roadside service station which includes a
separately owned Shell petrol filling station. The Property is
strategically located at the busy junction of the A14 and A140,
approximately seven miles north west of Ipswich in Suffolk.
The acquisition is being funded from equity resources, with
senior debt finance to be introduced in the near term. Completion
is due to occur in the next few weeks.
Simon Lee, Partner of LXi REIT Advisors Limited, commented:
"This acquisition provides the Company with additional
long-term, secure and RPI-linked income with an unusually
attractive rent review collar of 3% pa and cap of 7.5% pa, offering
significant rental growth in both high and low inflationary
environments. The net initial yield of 6.12% is accretive to our
portfolio running yield and will rise to at least 7.10% at the
January 2020 rent review on the basis of just the minimum 3% pa
rental uplift."
FOR FURTHER INFORMATION, PLEASE CONTACT:
LXI REIT Advisors Limited Via Newgate Communications
John White (Partner, Fund
Manager)
Simon Lee (Partner, Fund Manager)
----------------------------------- ---------------------------------
Peel Hunt LLP Tel: 020 7418 8900
Luke Simpson
----------------------------------- ---------------------------------
Newgate Communications (PR Tel: 020 7680 6550
Adviser) Email: lxireit@newgatecomms.com
James Benjamin
Lydia Thompson
James Ash
----------------------------------- ---------------------------------
NOTES:
The Company invests in UK commercial property assets let, or
pre-let, on very long (typically 20 to 30 years to expiry or first
break), inflation-linked leases to a wide range of strong tenant
covenants across a diverse range of property sectors.
The Company may invest in fixed-price forward funded
developments, provided they are pre-let to an acceptable tenant and
full planning permission is in place. The Company will not
undertake any direct development activity nor assume direct
development risk.
The Company is targeting a minimum annual dividend of 5 pence
per ordinary share, starting from the financial period commencing 1
April 2018, with the potential to grow the dividend in absolute
terms through upward-only inflation-protected long-term lease
agreements, and is targeting a net total shareholder return of 8
per cent. plus per annum over the medium term.
The Company, a real estate investment trust (REIT) incorporated
in England and Wales, is listed on the premium listing segment of
the Official List of the UK Listing Authority and was admitted to
trading on the main market for listed securities of the London
Stock Exchange in February 2017.
Further information on the Company is available at
www.lxireit.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACQSEEFISFWSEIW
(END) Dow Jones Newswires
July 21, 2017 02:00 ET (06:00 GMT)
Lxi Reit (LSE:LXI)
Historical Stock Chart
From Apr 2024 to May 2024
Lxi Reit (LSE:LXI)
Historical Stock Chart
From May 2023 to May 2024