Terrace Hill Group PLC Sale of Residential Portfolio (5352X)
February 08 2013 - 11:44AM
UK Regulatory
TIDMTHG
RNS Number : 5352X
Terrace Hill Group PLC
08 February 2013
8 February 2013
TERRACE HILL GROUP PLC
("Terrace Hill" or the "Group")
TERRACE HILL AGREES GBP70 MILLLION RESIDENTIAL PORTFOLIO SALE TO
PLACES FOR PEOPLE
Terrace Hill Group PLC (AIM: THG), a leading UK property
development and investment group, announces that it has exchanged
contracts with Places for People, one of the largest property
management, development and regeneration companies in the UK, for
the sale of the majority of its remaining residential assets,
comprising 925 units, for the sum of GBP70.0 million. The sale
comprises 95% of the Group's wholly owned residential assets and
91% of the properties held within Terrace Hill Residential, its
residential investment joint venture in which it owns a 49%
interest.
The sale price reflects a discount of less than 1% of the book
value of GBP70.66 million. On a pro forma basis worked from the
Group's year end accounts to 30 September 2012, as adjusted for the
effect of the completion of the Southampton forward funding
announced earlier this week, the Group's on balance sheet net debt
will reduce from GBP47.2 million to GBP20.2 million with a
reduction in gearing from 78.2% to 34.6%. On a look through basis,
including the Group's share of relevant associates' net debt, total
net debt reduces from GBP85.7 million to GBP26.7 million with
gearing reducing from 142.1% to 45.7%.
The sale is due to complete in February 2013. Terrace Hill has
already commenced a programme of sales to owner occupiers for the
remainder of the residential portfolio, which comprises 35 units
located in Manchester and the South West that have a book value of
GBP5.5 million.
Philip Leech, Chief Executive at Terrace Hill, commented: "This
sale follows our previously stated commitment to exit the
residential investment sector and concentrate on our core activity
of commercial development. Having given ourselves a further 18
months to implement this strategy, I am delighted that we have
completed the majority of the sales in a single portfolio
transaction, well ahead of time. The few retained properties are
currently being sold on a piecemeal basis to owner occupiers, most
of which are expected to achieve prices at levels in excess of book
value.
"The consequent reduction in net debt and gearing will have a
very positive affect on the Group's balance sheet and will allow us
to fully concentrate our financial and personnel resources on
commercial development, particularly in the food store sector where
we continue to see good opportunities and from which we expect to
deliver strong shareholder returns."
David Cowans, Chief Executive at Places for People,
commented:
"We're delighted to conclude this deal which is part of our
long-term strategy to build a private rented portfolio as part of
our housing offer to all of our customers."
-Ends-
For further information, please visit www.terracehill.co.uk or
contact:
Terrace Hill Tel: 020 7631 1666
Philip Leech
Places for People
David Mills Tel: 020 7843 3840
FTI Consulting Tel: 020 7831 3113
Richard Sunderland/Will Henderson /Faye Walters
terracehill@fticonsulting.com
Oriel Securities (Nominated Adviser) Tel: 020 7710 7600
Gareth Price
Mark Young
Notes to editors:
Terrace Hill Group
Terrace Hill Group PLC is a regionally based UK property
development and investment group quoted on AIM.
Formed in 1986, the Company has five offices located in London,
Glasgow, Teesside, Bristol and Manchester.
Places for People
Places for People is an award-winning property management and
development group which focuses on creating aspirational homes in
inspirational places - whether that means providing brand new
communities or transforming existing neighbourhoods into vibrant,
popular areas to live and work.
With assets in excess of GBP3bn Places for People has a strong
track record of successful development, from multimillion-pound
master planning projects to urban renewal and new-build
developments in cities across the UK.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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