Business
Proposed amendment of Investment Policy
Proposed amendment of Investment Policy.
About this update from Alternative Income Reit Plc
[{"type":"text","content":"\n \n \n \n RNS Number : 1075B\n Alternative Income REIT PLC\n 05 October 2020\n \n \n \n 5 October 2020\n Alternative Income REIT PLC\n (\"AIRE\", the \"Company\" or the \"Group\")\n \n Proposed amendment of Investment Policy\n \n The Board of Directors of Alternative Income REIT PLC (ticker: AIRE), the owner of a diversified portfolio of UK commercial property assets predominantly let on long leases, today sets out the background to and summary of proposed amendments to its investment policy which are subject to consultation with shareholders.\n \n As stated in the Company's trading update on 6 August 2020, the Board has been working closely with its investment adviser, M7 Real Estate Limited (\"M7\"), to identify a clear path to both expand the Company and enhance its performance. Since this announcement, rent collections have been very encouraging and a further announcement in relation to the September quarter will be made shortly.\n \n Background\n As announced on 7 August 2019, the Board received, as part of last year's strategic review, several proposals from various parties, which it reviewed carefully in consultation with the Company's then financial adviser. Following meetings with each of these parties and consultation with major shareholders, the Board concluded that none of the proposals reflected the true value of the Group and were not in the best interests of shareholders.\n \n The Board also considered the sale of the assets within the Company's portfolio in order to return the net proceeds to shareholders. However, the Board concluded that this would not deliver best value to its shareholders on account of a combination of the property disposal costs and the significant costs that would be incurred on early repayment of the Company's loan facility, which would in aggregate represent a material sum.\n \n The Group has a fully utilised £41.0 million loan facility with Canada Life Investments with a fixed interest rate of 3.19%, which is repayable on 20 October 2025. As noted above, prior to this date, the loan terms include significant early repayment fees, typical of fixed rate facilities. Furthermore, the loan terms also state that, where the net proceeds from any sale are not redeployed into new investments, then the lender can require full repayment from the net proce...