Elite UK REIT announced that its wholly-owned subsidiary, Elite Kist Limited, has entered into conditional share purchase and asset purchase agreements with Elite Voyager Limited and Elite Crest Limited, which are wholly-owned subsidiaries of Elite UK Commercial Fund III, to acquire five freehold or virtual freehold UK properties for £31.9 million.
The five properties are: Queensway House, East Kilbride; Griffin House, Wigan; Penhaligon House, St Austell; Challand House, Pontefract; and Bridgend Jobcentre, Bridgend.
The REIT manager states that the five new properties are expected to contribute annual gross rental income of approximately £2.6 million. On a pro forma basis, DPU for FY2025 would have increased 1.3% to 3.051 pence from 3.011 pence, while portfolio valuation would increase approximately 7% to £492.1 million from £460.2 million.
The five new properties will have a weighted average lease expiry (WALE) of 13.3 years by gross rental income as at Dec 31, 2025 and will increase Elite UK REIT’s lease maturity profile to 7.6 years on a pro forma basis, from 6.9 years as at March 31.
Besides the acquisition, the REIT manager announced that it will commence on an estimated capital expenditure of £19.0 million for the conversion of Lindsay House into a 170-bed purpose-built student accommodation asset.
Elite UK REIT intends to partially fund both the acquisition and Lindsay House conversion through existing debt borrowings of £30.7 million, issuance of new units to Elite UK Commercial Fund III of up to £8.9 million, and private placement to raise gross proceeds of £7.4 million.
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Meanwhile, the proposed acquisition is subject to the approval of Unitholders at an extraordinary general meeting to be convened at a later date.
“The proposed acquisition reinforces our portfolio with essential UK infrastructure assets that are underpinned by long-term, government-backed revenue, while conversion works at Lindsay House would position the property to be the REIT’s first purpose-built student accommodation, with completion ahead of Academic Year 2027. These are aligned with the Manager’s commitment to delivering sustainable yield for Unitholders,” says Joshua Liaw, CEO of the manager.
Units in Elite UK REIT were last traded at £0.34 on June 15 following this morning’s trading halt announcement.
