A significant move was made by AEW UK REIT PLC as they announced the completion of the sale of their prominent high-street retail holding located in Portsmouth, England. The property, situated at 208-220 Commercial Road and 7-13 Crasswell Street, was sold for a notable GBP3.9 million. This sale price showcases a net initial yield of 9.9% and a capital value of GBP251 per square foot.

Interestingly, the buyer of the property remains undisclosed. The sale price, however, marked a 22% increase from its valuation on June 30, which was GBP3.2 million. The property’s full occupancy and the potential risk associated with the main tenant, Nationwide Building Society, influenced AEW UK’s decision to sell. The concern stems from the possibility of Nationwide vacating the premises in 2029 when their lease agreement concludes.

Laura Elkin, the portfolio manager of AEW UK REIT, expressed satisfaction with the sale, stating, “We are pleased to have sold this holding for a healthy premium to valuation, having completed the asset management strategy, and therefore maximised value. Going forward, the asset presents a potential risk to the company’s shareholders, which further justifies a sale at this point in time.”

Following this announcement, AEW UK REIT shares experienced a slight dip of 1.9%, trading at 97.69 pence on Monday morning in London.