FOR IMMEDIATE RELEASE
The Local Shopping REIT plc (the "Company")
Update on Property Sales Programme
31 October 2018
The board of The Local Shopping REIT plc ("the Board") is pleased to provide the following update on progress with its property sales programme.
Since the last update, the Company has sold or exchanged contracts for sale on 15 properties for an aggregate price of £3.2 million, representing a 15.6% discount to carrying value before sales costs.
Of these, 3 properties were sold by private treaty transactions which completed or exchanged for an aggregate sale price of £0.5 million, representing a 2.7% premium to carrying value before sales costs.
The other 12 properties exchanged in auctions during October. The aggregate sale price of these was £2.6 million, representing an 18.5% discount to carrying value before sales costs.
The aggregate sales costs associated with all the disposals described above is estimated to be circa 3.3% of the aggregate sales price, resulting in an aggregate realised loss on sale of circa 18.4%.
The Company also completed the sale of the portfolio of 15 assets which was announced to the market on 23 May 2018, for an aggregate sales price of £9.05 million.
Currently, the company has £16.4 million in cash reserves and sales of properties in respect of which contracts have been exchanged are expected to generate a further £4.2 million in net sales proceeds before the end of the calendar year.
Excluding properties on which sale contracts have been exchanged, the remaining property portfolio comprises 27 properties. Of these, 8 are under offer for sale and 19 which will continue to be marketed, both by private treaty and auction, during the remainder of the calendar year, with the majority scheduled for auction in December.
The aggregate of the current carrying values for the 27 properties described above is £9.9 million. However, there is no certainty that these carrying values will be achieved on sale.
As indicated in the Company's announcement on 11 October 2018, the Board has been examining the options for returning value to shareholders. The Board has concluded that the optimum route for achieving this is likely to be by way of a Members' Voluntary Liquidation. The Board is therefore preparing to hold a General Meeting during December 2018 to enable shareholders to vote on this proposal, which the Board envisages would result in a substantial capital distribution early in 2019. To this end, a circular and notice of the General Meeting will be issued in due course.
The term "carrying value" used in this announcement refers to the property values comprised in the Company's unaudited accounts as at 31 March 2018.
Except as required by applicable law, the Company expressly disclaims any obligations to update or revise such estimates to reflect any change in expectations, new information, subsequent events or otherwise.
This document is for information purposes only and is not an offer to invest. All investments are subject to risk and past performance is no guarantee of future returns. Prospective investors are advised to seek expert legal, financial, tax and other professional advice before making any investment decisions.
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 ("MAR"). Upon the publication of this announcement, the inside information is now considered to be in the public domain for the purposes of MAR.
The person responsible for making this announcement is William Heaney, Company Secretary.
Rupert Wallman, Fund Manager, Principal Real Estate Europe +44 20 7355 8800
Bill Heaney, Company Secretary +44 20 7355 8800