Secure Income REIT PLC Merlin lease agreements to extend portfolio WAULT (9905W)
December 30 2021 - 2:00AM
UK Regulatory
TIDMSIR
RNS Number : 9905W
Secure Income REIT PLC
30 December 2021
30 December 2021
Secure Income REIT Plc
("the Company", "SIR")
Merlin lease agreements to extend SIR portfolio WAULT to 30 years
The Board of Secure Income REIT plc announces that in return for
a cash payment of GBP33.45 million to Merlin Entertainments Limited
("Merlin") to be paid from the Company's cash resources (the
"Capital Contribution"), Merlin has agreed it will extend the lease
terms in respect of Alton Towers, Thorpe Park, Warwick Castle and
Heide Park, Germany by 35 years, from 20.5 years currently, to 55.5
years without break from today.
Rental payments under the leases will remain unchanged, however
annual rent reviews of the UK assets, comprising Alton Towers,
Thorpe Park and Warwick Castle, will change from uncapped annual
upwards only RPI uplifts to annual reviews of CPI +0.5% (with a
floor of 1% per annum and a maximum increase of 4% per annum). The
Heide Park, Germany lease will continue to have fixed reviews
increasing annually at 3.34% for the full 55.5 year term.
All of the leases have also been updated to formalise the
existing close co-operation between SIR and Merlin in relation to
ESG, in particular the reporting and management of environmental
matters.
CBRE, SIR's independent external valuer, has confirmed that the
Capital Contribution paid represents not more than 50% of any
marriage value created as a result of the lease extensions. A
formal independent valuation will be provided, along with the
entire portfolio valuation as usual, when the Company reports its
full year results in early March 2022.
Commenting upon the transaction SIR Chairman Martin Moore
said:
"This is a very meaningful deal for our business, resulting as
it does in the weighted average unexpired lease term across the SIR
portfolio increasing from 19.2 years to 30.0 years, making our
WAULT the longest amongst our peers in the UK REIT sector.
"Merlin is a genuinely world class business which, through this
initiative and particularly the new ESG elements incorporated in
the agreements, has demonstrated its clear commitment to these
unique, landmark sites."
ENDS
For further information, please contact:
Secure Income REIT Plc +44 20 7647 7647
Nick Leslau Enquiries@SecureIncomeREIT.co.uk
Mike Brown
Tim Evans
Sandy Gumm
Stifel Nicolaus Europe
Limited
(Nominated Adviser to
SIR) +44 20 7710 7600
Mark Young StifelSecureIncomereit@Stifel.com
Stewart Wallace
FTI Consulting +44 20 3727 1000
(PR Adviser to SIR) SecureIncomeREIT@fticonsulting.com
Dido Laurimore
Claire Turvey
Eve Kirmatzis
About Merlin Entertainments Limited:
Merlin operates Europe's largest visitor attractions business
and the second largest in the World after Disney. Its parent
company guarantees all the tenant's commitments in SIR's leases.
Revenues from Q3 trading at its Resorts Theme Park segment (in
which all SIR's assets sit) were ahead of pre-pandemic trading in
Q3 2019.
The company's principal shareholders are Kirkbi, the investment
arm of owners of LEGO, the worlds' most profitable toy company,
Blackstone Core Private Equity and CPPIB, Canada's largest pension
fund.
About Secure Income REIT Plc:
Secure Income REIT Plc ("SIR") is a diversified UK REIT,
investing in institutional real estate assets that provide long
term rental income with upwards only inflation protection.
The Company's robust balance sheet, strong liquidity and
experienced Management Team enabled it to pay quarterly dividends
throughout the pandemic without interruption and, over seven years
since listing, delivered a Total Accounting Return of 15.0% p.a.
and a Total Shareholder Return of 15.6% p.a..
The Company, as at 30 June 2021, has GBP2.0 billion of gross
property assets, GBP1.3 billion of net assets, GBP184 million of
uncommitted and unfettered cash, structurally secure non-recourse
debt, and difficult to replicate very long leases on Key Operating
Assets in defensive sectors. The Management Team is strongly
aligned with shareholders through its 12.4% interest in the
business.
The Company is a UK REIT which floated on the AIM market of the
London Stock Exchange in June 2014.
The Company's LEI is 213800M1VI451RU17H40
Further information on Secure Income REIT is available at
www.SecureIncomeREIT.co.uk .
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. The person responsible for making
this announcement on behalf of the Company is Sandy Gumm,
Non-Executive Director and Chief Operating Officer of Prestbury
Investment Partners Limited.
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END
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