NewRver disposes of final Napier joint venture properties

NewRiver REIT has completed the sale of Kittybrewster Retail Park in Aberdeen and Glendoe and Telford Retail Parks in Inverness for a total consideration of £62.6m, it announced on Wednesday.

The buyer, RI UK 1, acquired the assets which collectively generated a net rental income of £5.7m during the 2022-2023 financial year.

NewRiver's share of the sale proceeds amounted to £31.3m, contributing to a reduction in the company's net debt.

The net cash receipt from the sale was £19.8m, and an additional £12m would be used to repay secured debt.

As a result, NewRiver's net debt on a proforma basis stood at £169.5 million, reducing the company's loan-to-value ratio (LTV) to 30.3% as of the same date.

The firm said the transaction marked the disposal of the final properties in the Napier Joint Venture - a partnership between NewRiver and PAF Lux SCA, SICAV RAIF, acting on behalf of its compartment PAF - Bravo III Compartment.

NewRiver said the total sale receipts from the Napier Joint Venture now amounted to £76m, reflecting a blended net initial yield of 7.4%.

“The Napier Joint Venture is a great example of why we like retail parks and working in capital partnerships,” said chief executive officer Allan Lockhart.

“Over our four years of ownership and management, we have been able to crystallise compelling returns for ourselves and our partner by utilising our specialist retail platform at each stage of the process, all the way from disciplined stock selection to successful delivery of asset management plans in order to secure a successful exit.

“In addition, the disposal means that the strength of NewRiver's balance sheet position is further improved, with proforma LTV now at 30.3% and significant cash resources giving maximum flexibility and optionality around capital allocation.”

At 1005 BST, shares in NewRiver REIT were down 1.35% at 87.5p.

Reporting by Josh White for Sharecast.com.