Aviva Investors Secure Income REIT IPO - Now CLOSED

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The Aviva Investors Secure Income REIT IPO is now CLOSED

27th May 2018

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Aviva Investors Secure Income REIT - IPO Overview

The Company intends to issue up to 200 million Ordinary Shares at 100 pence per Ordinary Share pursuant to the Issue, raising proceeds of £200 million, before commissions and other estimated costs and expenses.

Expected Timetable

  • Offer Open

    14th November 2017

  • Offer Closes:

    5th December 2017

  • Allocation announced:

    6th December 2017

  • Trading begins:

    8th December 2017


About Aviva Investors Secure Income REIT

The Company was incorporated in England and Wales on 27 September 2017 as a public limited company. The Company will, pursuant to the Investment Management Agreement, be externally managed by its investment manager, Aviva Investors UK Fund Services Limited, which is incorporated as a company limited by shares in the United Kingdom and is wholly-owned and controlled by Aviva. The Investment Manager is authorised and regulated by the FCA to perform fund management activities and to act as an alternative investment fund manager. The Company intends to carry on business as a REIT, subject to meeting the necessary qualifying conditions.

The Company will invest primarily in a diversified portfolio of high-quality long-lease commercial real estate assets in the UK. Properties will be leased to predominantly investment grade tenants. The Company will make its investments directly or through holdings in special purpose vehicles.

The Company’s primary objective is to deliver a secure and growing income return together with capital stability through typically upward only rent reviews linked to inflation or subject to fixed uplifts, together with the potential for capital growth by way of focused asset management and strategic acquisitions, with the intention of creating value for Shareholders. As at the date of this Prospectus, the Portfolio Manager has entered into exclusivity arrangements and/or advanced negotiations on behalf of the Company in respect of the acquisition of the four assets comprising the Target Portfolio of approximately £85 million.

The Investment Manager has delegated certain of its responsibilities and functions, including portfolio management, asset management and property level services to the Portfolio Manager, which is also a member of the Aviva Group. Pursuant to the Portfolio Management Agreement, the Portfolio Manager will be responsible for providing investment related services (including asset sourcing) to the Investment Manager and has discretion to make investment decisions subject to matters involving a conflict of interest which require the approval of Independent Directors. The Portfolio Manager will also be responsible for conducting initial due diligence on the commercial characteristics of potential investment opportunities. The Portfolio Manager has delegated certain of its responsibilities and functions for property level services to the Property Manager. Pursuant to the Property Management Agreement, the Property Manager will be responsible for providing
property level services in respect of the investments of the Company.

Highlights
  • Aviva Investors Secure Income REIT plc is a new UK REIT to be premium listed on the London Stock Exchange
  • The Company will invest in a diversified portfolio of high quality, long lease commercial real estate assets located within the UK, leased to predominantly investment grade tenants, typically with a minimum lease length of 10 years and a targeted weighted average lease length at the portfolio level of 15 years to expiry
  • Seeking to raise £200 million
  • On a fully invested and geared basis, the Company will target a dividend yield of 5.0% p.a. by reference to the issue price, which the Company will seek to increase broadly in line with inflation, and a total return of 7.0% p.a. over the medium-term
  • The Company intends to maintain a level of borrowing with a medium term target of 30-35% of the Company’s gross asset value
  • Investment management will be provided by the multi-award winning Real Estate Long Income team from Aviva Investors. Past performance is not a guide to future returns

Risks*
  • The Company is newly formed and has not yet made any investments
  • The Company may not meet its investment objective or achieve its targeted returns
  • The Company’s targeted returns are based on estimates and assumptions that are inherently subject to significant uncertainties and contingencies, and the actual rate of return may be materially lower than the targeted returns
  • The Company may be unable to make acquisitions
  • The Company’s investment strategy includes the use of leverage, which may be at both the Company and asset level, and which will expose the Company to risks associated with borrowing
  • The net realisable value of the Company’s portfolio of assets may not be accurately reflected in the purchase price paid by the Company, and may fluctuate over time

*Please note that these risks represent the judgement of Cornhill Capital, there may be additional risks represented in the prospectus


Offer Documents

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This announcement has been published by Cornhill Capital Limited.