Regional REIT has announced a proposed £100m capital raising to acquire two portfolios comprising a total of 20 office buildings around the country.
Portfolio One consists of three offices properties in Woking, Cheshunt and Edinburgh from NW UK III.
Portfolio Two comprises 17 office properties from Archimedes Real Estate.
The capital raising consists of a firm placing for new institutional shareholders for up to of around £50m, and a placing and open offer for existing shareholders for up to £50m.
The group has arranged a financing facility for the first portfolio, and has options, depending on the amount of money raised, to take out financing on the second portfolio.
As part of the transaction, Regional REIT is also refinancing a significant portion of its debt, which will give it a much simpler and more efficient balance sheet going forward.
The capital raising will also enable the group to partially fund another pipeline opportunity which is in advanced discussions.
Regional REIT said the portfolios are consistent with the company’s strategy to invest in regional office and industrial assets that offer good income returns and value enhancement asset management opportunities. They also enable further diversification of geographical location – further reducing Scottish exposure in favour of the South East. The two portfolios provide the group with 154 additional tenants, further reducing risk through the creation of a wider spread of income.
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