2026 Annual Financial Report and Notice of AGM

THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION IN THE UNITED STATES OF AMERICA, ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA, CANADA, AUSTRALIA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA.

29 October 2026

ALTERNATIVE INCOME REIT PLC

(the "Company" or the "Group")

Annual Report and Financial Statements for the year ended 30 June 2026 and Notice of AGM

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 with index-linked reviews, is pleased to announce its annual report and financial statements for the year ended 30 June 2026.

Financial Highlights

At 30 June

For the year ended 30 June

A Alternative Performance Measure, please see the Annual Report for further details.

B including gain on sale of investment property but excluding fair value changes.

Financial Highlights

Group Operational Overview

At the year end of 30 June 2026:

• The property portfolio had a fair value of £103.1 million across 19 properties (2025: £107.4 million across 20 properties).

• The European Public Real Estate Association (‘EPRA’) NIY A was 7.3%. (2025: 7.1%)

• 81.9% of rental income is inflation linked to the Retail Price Index or the Consumer Price Index. (2025: 92.3%)

• The property portfolio was fully let at both the current and previous year end.

• The weighted average unexpired lease term ('WAULT') was:

-     15.0 years to the earlier of break and expiry (2025: 15.6 years); and

-     16.7 years to expiry (2025: 17.2 years).

Income during the year

• Rent recognised amounted to £8.3 million. (2025: £7.9 million)

• A total of nine rent reviews took place during the year, reflecting an increase of 5.3% on the reviewed rent. The combined rental uplift of £179,000 provides an increase of 2.3% across the portfolio.

A Alternative Performance Measure, please see Annual Report for further details.

Property transactions during the year

• In October 2025, the Group’s petrol filling station in Crawley was sold for £4.5 million (gross of disposal costs).

Significant changes to leases

• In April 2026, Snap Fitness surrendered its lease of the gym in Chiswick, London, where it was paying £158,210 per annum, paying a surrender premium of £225,000 together with contributions of two months rent free and nine months capital fit-out incentive for the new tenant. Pure Gym has taken a new lease of the property, on Snap Fitness surrender, at £120,000 per annum for 15 years, with a tenant break at year 10.

Events after the reporting date

Offer for the Company by Glenstone REIT plc:

On 12 June 2026, Glenstone REIT plc (‘Glenstone’) announced a cash offer to acquire the ordinary share capital of the Company not already held by Glenstone and its concert parties for 70.0 pence per share. On 6 July 2026, Glenstone announced an increased final cash offer of 71.4 pence per share (the ‘Offer’). Following the declaration of the Company’s fourth quarterly interim dividend of 1.4 pence per share on 23 July 2026, the cash consideration payable under the Offer was adjusted to 70.0 pence per share, with eligible shareholders entitled to retain the dividend.

On 9 September 2026, Glenstone announced that the acceptance condition and all other conditions of the Offer had been satisfied or waived, and that the Offer had become unconditional. Following this announcement, the Board reconsidered its recommendation and advised shareholders to accept the Offer, taking into account the certainty of the cash consideration available and the risks associated with remaining a minority shareholder in a Glenstone-controlled company.

As at the date of publication of this Annual Report, Glenstone holds or has received valid acceptances in respect of approximately 87.08% of the Company’s issued ordinary share capital, representing 70,101,776 shares.

Should Glenstone reach the statutory compulsory acquisition threshold of 90% of the shares to which the Offer relates, it intends to exercise its rights under the Companies Act 2006 to acquire the remaining shares and subsequently re-register the Company as a private limited company.

Notice of AGM

The Company’s 2026 AGM will be held on Monday, 7 December 2026 at 10:00 am at the offices of JTC, The Scalpel 18th Floor, 52 Lime Street, London EC3M 7AF.

The Company's Annual Report and Financial Statements for the year ended 30 June 2026 and the formal Notice of the Annual General Meeting will be posted to shareholders. In accordance with UK Listing Rule 6.4.1, copies of the documents have been submitted to the UK Listing Authority and will shortly be available to view on the Company's corporate website at https://www.alternativeincomereit.com/ and for inspection from the National Storage Mechanism at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

ENQUIRIES

The Company's LEI is 213800MPBIJS12Q88F71.

Further information on Alternative Income REIT PLC is available at https://www.alternativeincomereit.com/1

NOTES

Alternative Income REIT PLC aims to generate a sustainable, secure and attractive income return for shareholders from a diversified portfolio of UK property investments, predominately in alternative and specialist sectors. The majority of the assets in the Group's portfolio are let on long leases which contain index-linked rent review provisions.

Chairman’s Statement

I am pleased to present the annual audited results of Alternative Income REIT PLC (the ‘Company’) together with its subsidiaries (the ‘Group’) for the financial year ended 30 June 2026.

Overview

A number of key changes have taken place subsequent to the financial year ended 30 June 2026, including the takeover of the Company by Glenstone REIT plc whose offer became unconditional on 9 September 2026 and led to the appointment of a new board.

From a property perspective, the year under review has been challenging, with geopolitical instability in the Gulf adding further uncertainty to the on-going global tariff disputes. Closer to home, business confidence has remained low as increasing tax burdens and persistent inflationary pressures continue to negatively influence investor sentiment and occupational demand.

Rental growth across the market has remained modest and whilst interest rates have held steady, the market expectations are that interest rates are more likely to rise, rather than fall. These factors have contributed to a further period of stagnation within the real estate sector.

From an income perspective, the Group continues to perform well in this challenging market with the portfolio demonstrating some degree of resilience. The portfolio benefits from its long-dated and high yielding leases, together with index-linked rental uplifts, providing a stable and predictable income stream.

During the year, one property transaction was completed, being the sale of the Group’s petrol filling station in Crawley for £4.5 million, a gain of £0.5 million based on its market value at the end of the previous year, with the net proceeds being used to repay £4.4 million of debt. Mainly as a result of this sale, the portfolio value has decreased by £4.24 million and at 30 June 2026 was valued at £103.11 million (2025: £107.35 million). On a like-for-like basis, making allowance for the sale of Crawley, the value of the Group’s properties decreased marginally by £240,000.

The portfolio should continue to perform relatively well during periods of higher inflation, given that 81.9% of its rental income is subject to index-linked reviews and 18.1% of rental income is not subject to any cap on rental increases. During the financial year, a total of nine rent reviews took place, generating an aggregate rental uplift of circa £179,000. This represents a 2.3% increase in contracted rental income across the Group’s portfolio and further demonstrated the defensive characteristics of the Group’s long- term strategy.

In the Chairman’s Statement last year, it was reported that the Group has secured new long- term debt facilities with HSBC UK Bank plc (‘HSBC’) for a term of five years, with an option to extend by two years if mutually acceptable to both parties.

Together with the active asset management initiatives being undertaken, the Board believes that the portfolio will continue to deliver an attractive and sustainable yield, supported by its improving rental income profile. This position is encouraging as global inflationary pressures continue to show signs of persisting. In the UK, concerns around renewed inflation continue to constrain the prospect of meaningful reductions in interest rates, thereby delaying the broader economic stimulus that lower borrowing costs would otherwise be expected to provide.

At the year end, the portfolio net initial yield has increased to 7.3% (2025: 7.1%) and a WAULT to the first break of 15.0 years and 16.7 years to expiry (30 June 2025: 15.6 and 17.2 years, respectively).

Refinancing of the Group’s Debt

The Group’s £41.0 million loan facility with Canada Life matured and was repaid on its due date of 20 October 2025.

The Group successfully refinanced its £41 million 3.19% fixed rate debt with Canada Life during the year with new long-term debt facilities with HSBC comprising a fixed term loan of £31 million and a £10 million RCF and were used to refinance the Group’s £41 million loan with Canada Life which ended on 20 October 2025.

The facilities are for a fixed term of five years from 20 October 2025, with an option to extend by two years if mutually acceptable. Whilst there is no present intention, AIRE has the right, through an accordion mechanism, to request an increase in the size of the RCF by up to a further £10 million, over the course of the facility.

Both the HSBC loan and RCF are floating rate with a margin of 1.7% per annum plus SONIA (sterling overnight index average rate). The margin represents an improvement in terms on the previous debt facilities, but total finance costs have increased as a result of the higher prevailing base rates. At 30 June 2026, the weighted average interest cost was 4.76%. The loan and the RCF are aggregated for the purposes of the debt’s financial covenants and, being based on a Loan to Value covenant which is not to exceed 60% and an Interest Cover Ratio (‘ICR’) to be greater than 160%, represent an improvement over the previous terms.

At year end, the Group had drawn down a total of £36.6 million from the facility, made up of the loan of £31 million and the RCF of £5.6 million, following the use of the proceeds from the disposal of Crawley to reduce the RCF by £4.4 million (30 June 2025: debt £41.0 million).

Following the Glenstone takeover offer being declared unconditional on 9 September 2026, HSBC issued a Reservation of Rights letter in connection with the change of control in the Group. On 28 October 2026, AIRE and HSBC entered into a waiver and amendment letter to the Facility Agreement, under which HSBC consented to the change of control and the Company’s subsequent de-listing from the London Stock Exchange, agreed to continue funding future utilisations and waived any right to require repayment as a result of the change of control.

Corporate activity and change of control

The financial year ended 30 June 2026 and the period subsequently have been marked by significant corporate activity, culminating in a change of control of the Company following Glenstone’s takeover of the Company.

In March 2026, AEW UK REIT plc (‘AEWU’) had announced that it was considering a possible all-share offer for the Company. Following discussions and due diligence, AEWU confirmed on 21 April 2026 that it would not proceed with its possible offer. AEWU subsequently announced a renewed possible all-share offer in July 2026, which was also withdrawn in August 2026 without a firm offer being made.

These approaches, together with the subsequent Glenstone Offer, resulted in the Company incurring professional advisory and other transaction-related costs which have had a one-off impact to the Company’s reported earnings for the year to 30 June 2026 and will also impact the current financial year’s earnings.

With respect to the year under review, professional costs incurred by the Company’s previous Board, principally in dealing with AEWU’s possible offer which was aborted on 21April 2026, amounted to £732,000 (0.91 pence per share).

On 12 June 2026, Glenstone announced a cash offer for the shares in the Company that it did not already own. This was followed on 6 July 2026 by an increased final cash offer of 71.4 pence per share, subsequently adjusted to 70.0 pence per share following the declaration of the Company’s fourth quarterly interim dividend of 1.4 pence per share, which eligible shareholders were entitled to retain.

On 9 September 2026, Glenstone announced that the Offer had become unconditional, following satisfaction of the acceptance condition and all other relevant conditions.

Changes to the composition of the Board followed this change of control, including the resignations of both Simon Bennett and Stephanie Eastment and the appointment of three new Glenstone directors to the Board, including my own re-appointment. I would like to acknowledge the contribution of both Simon and Stephanie whom I enjoyed working with and thank them for their stewardship of the Company over the last few years.

As at the date of publication of this Annual Report, Glenstone holds or has received valid acceptances in respect of approximately 87.08% of the Company’s issued ordinary share capital. The Offer will remain open until acceptances reach a level whereby Glenstone can effect the compulsory acquisition of the remaining shares, following which the Company will be de-listed and re-registered as a private company and 100%-owned subsidiary of Glenstone. In the meantime, the Board’s priority is to oversee an orderly transition, maintain appropriate governance and ensure that the Company’s property portfolio continues to be managed responsibly by AIRE’s current service providers.

Dividends and Earnings

During this financial year, the Company declared four interim dividends totalling 5.6 pence per share (‘pps’) (30 June 2025: 6.2pps). Historically the Board has paid dividends in four instalments each financial year. The Board does not intend to continue with this practice and, instead, will declare dividends in the future in compliance with the REIT regime’s rules.

Discount

The discount of the share price to NAV at 30 June 2026 widened to 16.9% (30 June 2025: 11.5%). The Board monitors the discount level throughout the year and has the authority to both issue and buy back shares. Although these powers have not been used to date, the Board believes these authorities are important powers for it to have available, if required, and therefore recommends that shareholders vote in favour of their continuance at the forthcoming AGM.

Board

The Board, comprising three directors, has always been deliberately kept small given the size of the Company. I had served on the Board as Glenstone’s representative since March 2021 until I resigned on 6 July 2026 when Glenstone announced its takeover offer.

I have therefore had influence and knowledge of the strategy of the Company for a considerable amount of time and deep knowledge of the portfolio.

Following my subsequent reappointment to the Board on 15 September 2026, a new Board, comprising myself, Ben Green and Rob Maybury, was appointed on 30 September 2026. My fellow directors appointed me to be Chair.

We are committed to ensuring the Company maintains appropriate levels of governance during the period and to acting in the best interests of all shareholders. Following our initial governance review, we have maintained the Company’s previous committee structure and each of the Committees comprise all members of the Board. The Audit Committee is chaired by Rob Maybury. The Management and Engagement Committee is chaired by myself.

It is Glenstone’s intention to keep its offer open and to reach a level of acceptances whereby it can exercise its rights to acquire AIRE’s remaining shares compulsorily under the Companies Act (‘Squeeze Out’) and apply to de-list the Company’s shares from the London Stock Exchange and re-register AIRE as a private company, wholly owned by Glenstone. In the event that acceptances for Glenstone’s offer do not reach the required threshold for the Squeeze Out to proceed, then the Company will appoint a new independent director to join the Board of AIRE.

AGM

The Company will hold its AGM at 10:00am on Monday 7 December 2026 at the offices of JTC, The Scalpel 18th Floor, 52 Lime Street, London EC3M 7AF.

The Board always welcomes engagement with shareholders, who should be aware that if they are unable to attend in person, they can submit questions to the Board by emailing the Company Secretary at AIRE.Cosec@jtcgroup. com or by writing to me at the Group’s registered office, namely, Alternative Income REIT PLC, The Scalpel 18th Floor, 52 Lime Street, London EC3M 7AF.

Outlook

The Group’s index-linked portfolio, with its properties let on predominantly long dated and high yielding leases, has continued to perform relatively well, when compared with its peer group. In the coming financial year, approximately 41.9% of the Group’s income will be subject to rent reviews (27.9% as annual index-linked rent reviews and the remaining 14.0% being periodic three or five yearly index-linked rent reviews).

Interest rates have fallen 50 basis points since June 2025, with the Bank of England’s base rate now standing at 3.75%, providing a more supportive backdrop for property valuations.

With most of the portfolio on index-linked leases, the sustained inflationary environment has continued to drive rental income growth in real terms, providing shareholders with a natural inflation hedge. Combined with the Group’s active asset management initiatives, the Board remains confident the portfolio will continue to deliver an attractive yield underpinned by its secure and growing rental income.

As set out in the Offer Document, Glenstone now intends to proceed with the Delisting and will, accordingly, procure that the Company makes applications (i) to the Stock Exchange for the cancellation of the admission to trading of the Company’s shares on the main market for listed securities and (ii) to the FCA for the cancellation of the listing of the Company’s shares on the closed ended investment funds category of the Official List, together being the Delisting.

It is expected that the Delisting will take effect once Glenstone is able to exercise its statutory squeeze-out rights to compulsorily acquire the Company’s remaining shares held by non-assenting shareholders.

I would like to take this opportunity to thank all the Company’s advisers for their professional services and support during the financial year.

Adam Smith Chairman 28 October 2026

Business Model and Strategy

Alternative Income REIT PLC is a real estate investment trust listed on the closed-ended investment funds category of the Official List of the Financial Conduct Authority (‘FCA’) and traded on the Main Market of the London Stock Exchange. As part of its business model and strategy, the Group has maintained and intends to maintain its UK REIT status.

The Company is governed by a Board of non-executive directors (the ‘Board’) and has no employees. The Board is responsible for determining the Company’s investment objective and investment policy. Like many other REITs and investment companies, the day-to-day management and administration of the Company is outsourced by the Board to third party providers, including Martley Capital Real Estate Investment Management Limited (‘Martley Capital’) as Investment Adviser, Langham Hall Fund Management LLP as AIFM and JTC (UK) Limited as Company Secretary.

Investment Objective

The investment objective of the Group is to generate a secure and predictable income return, sustainable in real terms, whilst at least maintaining capital values, in real terms, through investment in a diversified portfolio of UK properties, predominantly within the alternative and specialist sectors.

Investment Policy

In order to achieve the investment objective, the Group invests in freehold and long leasehold properties across the whole spectrum of the UK property sector. The Group’s emphasis is on alternative and specialist property sectors in order to access the attractive value and capital preservation qualities which such sectors offer.

The Group invests in properties that can generate predictable income streams through long leases which have contractual exposure to inflation rates, focusing on properties which have the ability to deliver secure income and preserve capital value, with an attractive entry yield.

The Group will supplement this with active asset management initiatives for certain properties.

Permitted sectors include, but are not limited to the following, subject at all times to the assessment of their appeal and specific asset investment opportunities: healthcare; leisure; hotels and serviced apartments; education; automotive; car parks; residential; supported living; student accommodation; logistics; storage; communications; supermarkets (within the alternative and specialist real estate sectors). In addition, permitted sectors include: offices; shopping centres; retail and retail warehouses; and industrial (being defined as ‘Traditional’ real estate sectors), subject to the limitations on sector exposure below.

The Group is not permitted to invest in land assets, including development land which does not have a development agreement attached, agriculture or timber.

Each investment must enable the portfolio to comply with the following minimum targets at the time of investment:

Whilst each acquisition is made on a case-by-case basis, properties typically offer the following characteristics:

The Group may invest in commercial properties or portfolios of commercial property assets which, in addition, include ancillary or secondary utilisations.

The Group may invest in corporate and other entities that hold property and the Group may also invest in conjunction with third-party investors.

The Group may engage in full or partial interest rate hedging or use derivatives to seek to mitigate the risk of interest rate increases as part of the Group’s portfolio management.

Investment limits

The Group will invest and manage its assets with the objective of spreading investment risk through the following:

The Group will not invest in other closed-ended investment companies.

If the Group invests in derivatives for the purposes of efficient portfolio and cash management, the total notional value of the derivatives at the time of investment will not exceed, in aggregate, 20% of GAV.

Borrowings

The Group may utilise borrowings with a view to enhancing returns over the medium term. Borrowings, where utilised will be on a limited recourse basis for each investment on all or part of the total portfolio and will not exceed 40% of GAV (measured at drawdown) of each relevant investment or of the portfolio.

Dividend Policy

The Board's policy during the year under review was to pay dividends in four instalments each financial year. The Board does not intend to continue with this practice and, instead, will declare dividends in the future in compliance with the REIT regime’s rules.

Key Performance Indicators

EPRA Performance Measures

The EPRA performance measures of the Group follow. All are Alternative Performance Measures.

1 The reconciliation of this APM is set out in Note 8 of the Notes to the Consolidated Financial Statements.

2  The reconciliation of this APM is set out in the EPRA Performance Measures Calculations section following the Notes to the Consolidated Financial Statements.

Investment Adviser’s Report

Market Outlook

UK Economic Outlook

The UK economy maintained stronger-than-expected momentum through the second quarter of 2026. GDP grew by 0.6% in Q1 and monthly output expanded by 0.1% in May, reversing April’s 0.1% decline. This left GDP 0.7% higher in the three months to May than in the preceding three-month period, marking a sixth consecutive period of underlying expansion A. Annual GDP growth strengthened to 1.3% in May, its fastest pace since mid-2025, although the Bank of England continues to caution that the effects of the Middle East energy shock may weigh on activity in the second half of the year B. The UK’s relative performance has improved, with Q1 growth outpacing both the Eurozone (-0.2%) and the United States (0.4%), leaving the UK 6.0% above its Q4 2019 level compared with 6.6% for the Eurozone and 15.1% for the US C.

Labour market conditions softened further but remained broadly resilient. The unemployment rate was 4.9% in the three months to May 2026, unchanged from the previous quarter but 0.2 percentage points higher than a year earlier.

Unemployment claimants increased to 1.69 million in June and youth unemployment climbing to 14.7% D. Payrolled employment continued to edge lower and vacancies remained on a downward trend, consistent with ongoing hiring caution among employers. Annual regular pay growth held at 3.4% in the three months to May, its weakest rate since 2020 and further evidence that wage pressures are easing E. The British Chambers of Commerce continues to expect a gradual loosening of labour market conditions, forecasting unemployment to average 5.2% in 2026 and business investment to contract by 2.2% F.

Inflationary pressures eased during Q2 as energy-related price pressures moderated. CPI inflation fell to 2.6% in June 2026 from 2.8% in May G; with lower motor fuel prices making the largest downward contribution to the decline following the US-Iran ceasefire and the associated de-escalation in Middle East energy risk. Services inflation also eased to 3.6% from 3.7%, although underlying domestic price pressures remain above levels consistent with the Bank of England’s 2% target. The Bank’s June Monetary Policy Report revised down its near-term inflation outlook, reflecting lower energy prices and a more limited pass-through from the earlier Middle East energy shock H.

Against this backdrop, the Monetary Policy Committee left Bank Rate unchanged at 3.75% in both June and July. The June decision was passed by a 7-2 majority, with two members voting for a 25 basis point increase, – the two dissenters favouring a 0.25 percentage point increase to 4% – as falling global energy prices were weighed against services inflation of 3.7% I. By the end of July, markets had largely abandoned expectations of further policy easing during 2026, reflecting concerns over persistent services inflation and the risk of renewed energy price pressures J. Since then, markets have moved to price a high probability of a rate increase in November, and 10-year gilt yields have risen above 5.4%, their highest level in nearly two decadesK . This marks a sharp reversal from pre-conflict pricing, which had implied additional easing through 2026.

Survey evidence paints a mixed but gradually improving picture. ONS business surveys suggest that turnover expectations have stabilised after weakening earlier in the year, while consumer confidence has recovered noticeably from its spring lows. The July ONS Business Insights and Conditions Survey found 14% of trading businesses expecting a turnover decrease, roughly in line with the 13% recorded in March and well down from the deterioration seen through the conflict-hit spring months L. Meanwhile, the Consumer Confidence Index rose to -13 in July, its strongest reading since early 2022, supported by easing inflation and lower fuel costs M.

Overall, while growth has remained resilient, the outlook has deteriorated since the period end. Inflation has risen to 3.1% in August N and the Bank of England expects it to exceed 4% in early 2027 O, although wage pressures continue to moderate. The labour market is also gradually loosening and business investment remains subdued. The Bank of England’s decision to hold the Bank Rate signals continued caution in the face of persistent services inflation and uncertainty over the energy outlook. The BCC continues to forecast subdued 2026 growth (0.9%), rising unemployment (5.2%) and contracting business investment, and while sentiment has improved from its spring lows it remains fragile. The result is an outlook of modest expansion rather than renewed acceleration, with the principal risks stemming from energy markets, inflation persistence and the prospect of a further rise in interest rates.

UK Real Estate Outlook

UK real estate investment totalled £51.2 billion in the 12 months to June 2026, a period characterised by an exceptionally strong end to 2025 followed by a more cautious first half of 2026. Activity peaked at £21.6 billion in Q4 2025, supported by Welltower’s £6.4 billion acquisition of the Barchester and HC-One care home portfolios, before moderating to a combined £20.7 billion across Q1 and Q2 2026 as geopolitical uncertainty and higher financing costs tempered investor activity P. Despite softer volumes, large-scale transactions remained a defining feature of the market, including Unite Group’s £723 million acquisition of Empiric Student Property and Morgan Stanley/Ridgeback’s £1.0 billion purchase of the Metra Living PRS portfolio. Overseas capital continued to play a leading role, with inflows doubling to a near four-year high of £8.3 billion in Q4 on a 116% surge in North American buying, before rotating from a six-year-high European quarter in Q1 (£2.1 billion) to a North American-led Q2 (£2.9 billion), although net overseas investment fell sharply in Q2 as elevated disposal activity reduced net purchasing to one of the lowest levels on record.

Monetary and pricing conditions became more challenging during the year. Following the Bank of England’s reduction of Bank Rate to 3.75% in December 2025, expectations for further easing were disrupted by the Middle East conflict and its impact on energy markets. CPI inflation rose to 3.3% in March 2026 before easing to 2.6% in June 2026, while the Monetary Policy Committee maintained Bank Rate at 3.75% throughout 2026, including at its July meeting. The June decision was split 7-2, with two members voting for a 25 basis point increase Q. The investment market reflected this shift in sentiment. Prime All Property yields hardened from 5.58% in Q3 2025 to 5.55% in Q4, before softening to 5.63% in Q1 2026 and 5.66% in Q2 2026 as investors reassessed interest rate and inflation risks P. As a consequence, Oxford Economics has revised its 2026 forecast for All Property capital growth to broadly flat, with total returns expected to be approximately 4.9%, compared with pre-conflict expectations of around 7.8%, although returns are still forecast to strengthen to 6-7% per annum during 2027-28 R.

The living sector remained the dominant area of the market, attracting £22.4 billion of investment, equivalent to 44% of total annual transaction volumes. Following a record £10.6 billion in Q4 2025, activity normalised during the first half of 2026, although build-to-rent and private rented sector assets continued to attract significant institutional interest and hotels recorded their strongest transaction volumes for two years P. Industrial and retail markets experienced greater volatility, both benefiting from large transactions in late 2025 before weaker activity in early 2026. Nevertheless, performance remained resilient: MSCI data indicate retail delivered total returns of approximately 3.7% during the first half of 2026, ahead of industrial at 2.6%, highlighting the continued importance of income growth and constrained supply in supporting values S.

Within listed real estate, UK REIT discounts continued to narrow. By June 2026, the eight companies in the AIC UK Commercial Property sector traded at an average 20.7% discount to NAV, compared with approximately 28% at the start of the year, although still above the long-term average of around 17% T. Against this backdrop, AIRE continued to demonstrate operational resilience. The Company achieved its targeted annual dividend of at least 5.6p per share for FY2026, reported a NAV of 83.3p per share, and generated a 1.5% NAV total return during the quarter to June 2026. Performance was supported by a fully let portfolio, 100% rent collection, 82% index-linked leases and a 7.2% net initial yield U. The share price discount widened to 16.9%, reflecting broader sector sentiment rather than portfolio-specific factors U. Long-term capital market assumptions published by J.P. Morgan Asset Management continue to suggest that core real assets can generate high single-digit annualised returns over the coming decade, supporting the investment case for income-focused strategies V.

UK real estate enters the second half of 2026 against a backdrop of resilient occupier fundamentals but increased macroeconomic uncertainty. Transaction volumes remain heavily dependent on a relatively small number of large transactions, while vendors continue to resist price adjustments in the absence of financial pressure P. With expectations of near-term yield compression largely removed, income growth has become the principal driver of returns. Oxford Economics forecasts retail to deliver annual total returns of approximately 7.5% to 2030, ahead of 6.4% for the All Property market, reflecting attractive starting yields and improving occupational fundamentals R. At the same time, constrained supply, continued rental growth, tightening sustainability requirements and the UK’s enduring appeal to international capital should provide support to values over the medium term, notwithstanding ongoing geopolitical and inflation-related risks.

Portfolio Activity During the Year

The following transactions happened during the year:

The following asset management initiatives were undertaken during the year:

Rent Reviews

A total of nine rent reviews took place (excluding Crawley) during the year with a combined uplift of £179,016 with an average increase in contracted rent of 5.1%. The portfolio showed an increase of 2.3% on a like-for-like basis.

Negotiations are in progress in respect of lease regears and renewals with many tenants including Meridian Steel, B&M, Pets at Home and BGEN. The Company remains supportive of its occupiers to work together to improve the environmental sustainability of the portfolio.

NAV Movements

* Exceptional corporate activity costs arose from professional advisory, legal, corporate finance and other costs in connection with evaluating and responding to a number of unsolicited takeover and corporate proposals.

Valuation

At 30 June 2026 the Group owned 19 property assets (2025: 20) and the portfolio was valued at £103.11 million (2025: £107.35 million). During the year the Group successfully sold the petrol filling station in Crawley, therefore on a like-for-like basis, the value of the Group’s properties decreased marginally to £103.11 million from £103.35 million.

Summary by Sector

at 30 June 2026

Summary by Geographical Area

at 30 June 2026

1 The ERV (%) in the summary by sector and geographical area is calculated using the precise unrounded ERV figures, not the rounded ERV (£m).

The table below illustrates the weighting of the Group’s contracted rental income, based on the type of rent review associated with each lease.

% of Passing Rent by Rent Review Type

% of Passing Rent by Review Frequency

% of Passing Rent by Cap Band

Property Portfolio at 30 June 2026

Top Ten Tenants at 30 June 2026

* The WAULT calculations includes an additional three years reflecting a landlord’s option to extend until 31 May 2044. ** This WAULT calculation, which considers income solely from the top ten tenants, differs from the portfolio-wide WAULT of 15.0 years.

Tenancy Schedule

* Ground rents less than £150 per annum.

Environmental, Social and Governance Report

The Group recognises that Environmental, Social and Governance (‘ESG’) matters and Climate-Related risks are of utmost importance to sustainable investment, long term performance of the Group’s property portfolio and a focus for the business and investor community. The Group is committed to understanding how best to consider ESG factors in all facets of its business, from business strategy to investment decisions and company operations.

In order to meet investors’ expectations, the Group and its advisers adopt both financial and non-financial strategies to drive long-term value with an innovative yet disciplined and conscientious approach to ESG in respect of the property portfolio management including but not limited to:

Environmental

Social

Governance

Diversity

As an externally managed business, the Company does not have any employees or office space. As such, the Group does not operate a diversity policy with regards to any administrative, management and supervisory functions. A description of the Board’s policy on director diversity can be found in the Corporate Governance Report of the Annual Report.

Employees

The Group has no employees and accordingly no requirement to report separately in this area as the management of the portfolio has been delegated to the AIFM and Investment Adviser.

The AIFM and Investment Adviser are equal opportunities employers who respect and seek to empower each individual and the diverse cultures, perspectives, skills and experiences within their workforce.

Human Rights

The Group is not within the scope of the Modern Slavery Act 2015 because it has not exceeded the turnover threshold and therefore no further disclosure is required in this regard.

Business Relationships

As well as the critical day-to-day portfolio management, the Group has service providers that ensure the smooth running of the Group’s activities. The Group’s key service providers are listed in the Annual Report, and the Management Engagement Committee (‘MEC’) annually review the effectiveness and performance of these service providers, taking into account any feedback received.

The Group, AIFM and Investment Adviser and other third-party service providers maintain high standards of business conduct by acting in a collaborative and responsible manner with all business partners that protects the reputation of the Group as a whole.

Climate-Related Reporting

The Board has considered the applicability of the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations and the evolving UK sustainability reporting framework. The Company has not, for the year ended 30 June 2026, prepared disclosures fully aligned with all TCFD recommendations or IFRS Sustainability Disclosure Standards. The Board considers its current approach proportionate to the nature, size and externally managed structure of the Company but will continue to review reporting requirements and investor expectations as the regulatory landscape develops.

The Company nevertheless considers climate-related risks within its principal risk management and investment oversight processes.

As an externally managed REIT, the Company relies on the AIFM and Investment Adviser to assess and monitor ESG matters and Climate-Related risks and to report regularly to the Board on relevant developments.

Greenhouse Gas Emissions

As an investment company, the Group’s own direct environmental impact is minimal and greenhouse gas (‘GHG’) emissions are negligible. The GHG emissions in relation to the Group’s property portfolio is disclosed below.

The Group has followed UK Government environmental reporting guidelines and used the UK Government 2026 greenhouse gas reporting conversion factors for company reporting to identify and report relevant GHG emissions over which it has Operational Control (where data is available) for the 12-month period to 30 June 2026.

An independent consultancy specialising in the application of sustainability in commercial real estate was appointed to calculate the GHG statement and provide verification on the approach used.

Scopes

GHG emissions have been reported against the following ‘Scopes’, as defined by the GHG Protocol and where relevant:

Scope 1: (not relevant to AIRE): Direct emissions from owned vehicles, controlled boilers and fugitive emissions from air conditioning systems under landlord control.

Scope 2: Indirect emissions from electricity purchased by the Company and consumed within real estate assets owned by the Company.

Scope 3: Indirect emissions from electricity and gas purchased/consumed within AIRE assets, by tenants, where the tenant is counterparty to the energy supply.

Statement of GHG Emissions

The table below sets out the emissions per sector and for the Group overall in the year ended 30 June 2026. The approach taken follows guidance provided by UK Government Reporting Guidelines and EPRA Best Practice Recommendations of Sustainability Reporting 2024.

*  Like-for-like requires 24 months of data for the current and previous reporting year (July 2024 – June 2026). Both assets provided 24 months of data therefore like-for-like calculations were possible.

** A carbon dioxide equivalent for Scope 2 is not possible as only external areas covered.

Statement of Energy Usage

The table below sets out the energy use per sector and for the Group overall. The approach follows guidance provided by the GHG Reporting Guidelines (DESNZ, 2025) and the EPRA Best Practice Recommendations on Sustainability Reporting 2024.

Intensity Ratios

In addition to reporting relevant absolute GHG emissions (per scope and per sector), the Group has chosen to report intensity ratios, where appropriate. An intensity measure is reported for assets within the like-for-like portfolio, where:

Whilst no landlord meters reflect the above criteria for an intensity metric, the Group has applied an intensity figure for one asset, Pocket Nook, an Industrial Warehouse, where the landlord procures the energy and directly recharges this to the tenant. An intensity metric has not been produced for Droitwich Spa retail park on the basis that the landlord-controlled meter does not reflect the above criteria (emissions reported relate to an indoor area).

Normalisation factors

No normalisation factors have been considered for this annual report.

Assurance Statement

The Group’s GHG emissions have been calculated and verified by an independent third-party in accordance with the principles of ISO 14064. A full copy of the methodology used, including scope, source or data and conversion factors, is available on request.

Property Portfolio ESG Activity

During the year ended 30 June 2026, the Group has worked closely with its tenants to encourage improvements in ESG activities within the property portfolio.

Two new EPC’s ratings have been carried out for the Driving Centre in St Helens which improved from B46 to A+-6 following refurbishment works & installation of PV panels by the DVLA, and YMCA which fell from B32 to C59 due to the changes in EPC grading for gas fired heating systems. Recommendations of EPC assessors are being considered on two other properties by the occupiers including replacement of LED lighting and boiler replacement.

Year-on-Year EPC Comparison

Other than the changes for SoS and YMCA’s EPC rating and the disposal of Crawley (B) the changes within the graph above are as a result of changes to relative ERV levels.

In the histogram above, the highest EPC rating of E applies to Unit 14 Provincial Park, Sheffield where the tenant is considering the cost efficiency of replacing their oil-fired boiler to electric. At Unit 2 Pocket Nook, St Helens, though the nature of the open-ended industrial process does not conform to EPC standard assessment, an exemption can be sought. The remaining properties in the portfolio have an EPC rating of D or above. 50.0% of the portfolio falls between A+ and B.

Section 172(1) Statement

The following disclosure describes how the directors have had regard to the matters set out in section 172(1)(a) to (f) of the Companies Act 2006, in promoting the success of the Company for the benefit of members as a whole.

This section describes how the Board has regard to the likely consequences of any decision in the long term, the need to foster the Company’s business relationships with suppliers, customers and others, the desirability of the Company maintaining a reputation for high standards of business conduct, and the need to act fairly as between members of the Company. The Company does not have any employees and therefore s172(1)(b) is not applicable to the Company. The impact of the Company’s operations on the community and the environment is set out more fully in the Environmental, Social and Governance section above.

Principal decisions

Principal decisions are those that have a material impact to the Group and its key stakeholders. In taking these decisions, the directors considered their duties under section 172 of the Act.

Dividend and Dividend Policy

Given the Company’s Investment Objective, dividends are a key matter for the Board to consider and have a material impact on shareholders, as a key stakeholder. For the year ended 30 June 2026, the Board declared four interim dividends totalling 5.6pps (2025: 6.2pps), representing a 9.7% decrease on the previous year.

As last year, the Board paid four interim dividends at quarterly intervals to provide shareholders with a consistent and timely income stream. The Board does not intend to continue with this practice and, instead, will declare dividends in the future in compliance with the REIT regime’s rules.

Property Transactions

In the year, one property transaction completed, being the sale of the Group’s petrol filling station at Crawley for £4.5 million (gross of disposal costs). This property represented 4.0% of the Group’s portfolio capital valuation at 30 September 2025. The disposal represented a net initial yield of 6.3%.

Investment Advisory Fees

The Group’s Investment Adviser is Martley Capital Real Estate Investment Management Ltd (‘Martley Capital’), with effect from 1 January 2026 the terms of the management fee have been altered so that the Investment Adviser shall be entitled to receive a rate equivalent of 0.50% per annum of NAV (subject to a minimum fee of £400,000 per annum) payable quarterly in advance. This fee is subject to an annual increase from 1 January each year in line with the percentage to change in the Retail Prices Index (RPI) published by the UK Office for National Statistics subject to a minimum annual increase of 3% and a maximum annual increase of 5%.

During the year the Group incurred £380,000 in respect of investment advisory fees to Martley Capital (2025: £360,000). No amounts were accrued at the year-end (2025: £ nil).

Principal Risks and Uncertainties

The Group’s assets consist of UK commercial property. Its principal risks are therefore related to the commercial property market in general, but also to the particular circumstances of the individual properties and the tenants within the properties.

The Board has overall responsibility for reviewing the effectiveness of the system of risk management and internal control which is operated by the AIFM and, where relevant, the Investment Adviser. The Group’s ongoing risk management process is designed to identify, evaluate and mitigate the risks the Group faces.

The Board undertakes a semi-annual risk review with the assistance of the Audit Committee, to assess the adequacy and effectiveness of the AIFM’s, and where relevant the Investment Adviser’s, risk management and internal control systems.

The Board has carried out a robust assessment of the principal and emerging risks facing the Group, including those that would threaten its business model, future performance, solvency or liquidity.

An analysis of the principal risks and uncertainties is set out in the table below. This does not purport to be exhaustive as some risks are not yet known and some risks are currently not deemed material but could turn out to be material in the future.

* This risk rating applies at 30 June 2026, prior to the change of control on 9 September 2026.

** Shareholders who have not accepted the offer face one of two outcomes:

Squeeze-out: If Glenstone acquires +90% of the shares to which the offer relates, it may compulsorily acquire the remaining shares on the terms of the offer (70.0p per share) under section 979 of the Companies Act 2006.

 Delisting: Otherwise, Glenstone has stated its intention to cancel the Company’s listing and seek admission to The International Stock Exchange (TISE). Remaining shareholders would then no longer benefit from the UK Listing Rules, the Disclosure Guidance and Transparency Rules or the UK Corporate Governance Code or AIFMD. They would instead be subject to TISE’s listing rules, whose continuing obligations are generally regarded as less onerous than those of the Listing Rules.

Emerging risks

The Board takes account of and considers emerging risks as part of its risk management assessment.

Going Concern and Viability Statement

Going Concern

The Group has considered its cash flows, financial position, liquidity position and borrowing facilities.

In particular, the Group’s unrestricted cash balance at the year-end was £2.3 million (2025: £3.1 million). The Group has no capital commitments or contingent liabilities. The Group refinanced its borrowings of £41 million on 20 October 2025 with HSBC (‘the HSBC Bank Facilities’). The HSBC Bank Facilities consist of both a fixed term loan of £31 million and a £10 million revolving credit facility, both on floating rates and on a fixed term of five years with an option to extend by two years if mutually acceptable. Details of the new debt facilities are contained in Note 13 to the financial statements which includes covenant details, all of which are reported in accordance with the Group’s risk management procedures and policies.

The Group has net current assets of £3.4 million at 30 June 2026 (2025: net current liabilities of £36.5 million) and has the ability to meet its financial obligations as they fall due.

In respect of the Loan, the Group is permitted to utilise up to 40% of GAV measured at drawdown with a Loan to GAV of 34.4% at 30 June 2026. Therefore, the Group had headroom against its borrowing covenant. The lender’s loan to value covenant of 60% is significantly higher than the Group’s Loan to GAV. In addition, if agreed by the current lender, two properties not secured against the Loan and valued at £8.5 million are available as additional security for the Loan.

The Loan also has a lender’s cash trap interest cover covenant of 160% and default interest cover of 150%. At 30 June 2026 the Group’s interest cover ratio was 422.2%, giving significant headroom. A ‘severe but plausible downside’ scenario has been projected. While rent collections have been strong, this scenario projects rent deferrals and write-offs for tenants with difficulty paying rents from operational cash flows. In this scenario the Group still has adequate headroom against the interest cover covenant and positive cash balances. Further detail of the assumptions made in assessing the adoption of Group’s going concern basis can be found in Note 2.4.

The Group benefits from a secure, diversified income stream from leases which are not overly reliant on any one tenant or sector, with the Group generating net cash flows from operating activities for the year being reported of £6.7 million. As a result, the directors believe that the Group is well placed to manage its financing and other business risks.

The going concern statement is based on the reporting requirement that the Group and the Company has adequate resources to continue in operational existence for the foreseeable future, being a period of at least 12 months from the date of these financial statements. For the reasons explained above, the Board is satisfied that the Group and the Company have adequate resources to continue in operational existence for the foreseeable future and is of the opinion that the going concern basis adopted in the preparation of the financial statements is appropriate.

Following its acquisition of a controlling interest in AIRE, Glenstone now intends to acquire the remaining shares through the ongoing takeover offer and, subject to reaching the relevant threshold, exercise its statutory squeeze-out rights, resulting in AIRE becoming a wholly owned subsidiary of the Glenstone Group. There is no intention to liquidate AIRE or cease its operations. The intention is for AIRE to continue operating as an income-producing property investment business, with the existing portfolio retained during the acquisition process.

The Board therefore considers that Glenstone’s intended strategy represents a change in ownership and operational management rather than a cessation of the underlying business and, accordingly, does not have a material adverse impact on the appropriateness of preparing the financial statements on a going concern basis.

Viability Statement

In accordance with provision 30 of the UK Corporate Governance Code, the Board has assessed the prospects of the Group for at least the 12-month period from the date the financial statements are approved as required by the ‘Going Concern’ provisions.

The Board has considered the nature of the Group’s assets and liabilities and associated cash flows and has determined that three years, from the balance sheet date up to 30 June 2029, is an appropriate and realistic timescale over which the performance of the Group can be forecast with a degree of accuracy. Even though the Group’s contractual income extends beyond three years, the Board considers this period (the ‘Period’) to be appropriate, given:

In performing its viability review, the Board considers the Group’s cash flows (noting that the Group’s property portfolio had a WAULT to break of 15.0 years and a WAULT to expiry of 16.7 years at 30 June 2026, representing a secure income stream for the Period), REIT compliance and relevant key financial ratios over the Period. The Board carried out a thorough review of the Group’s business model, following the change of control following the Glenstone offer being unconditional. The Group will operate as a subsidiary of Glenstone with its own management and will retain the HSBC Bank Facilities which are secured against the Group’s portfolio. The cash flow included an estimation of future performance, liquidity and banking covenant tests for the Period. The Board has assessed the extent of any operational disruption; potential curtailment of rental receipts; potential liquidity and working capital shortfalls; and diminished demand for the Group’s assets going forward, in adopting a going concern preparation basis and in assessing the Group’s longer-term viability.

These assessments are subject to sensitivity analysis, which involves flexing a number of key assumptions and judgements included in the financial projections:

The Group’s debt:

The Group has borrowings of £41 million under a loan facility repayable on 20 October 2030 with HSBC. The HSBC Bank Facilities consist of both a fixed term loan of £31 million and a £10 million revolving credit facility, both on floating rates and on a fixed term of five years with an option to extend by two years if mutually acceptable. Details of the HSBC Bank Facilities are contained in Note 13 to the financial statements. Specifically with respect to viability and the Group’s debt:

Based on the prudent assumptions within the Group’s forecasts including the rent deferrals, tenant default, void rates, property valuation movements and the successful refinancing of the debt, the Board has a reasonable expectation that for the Period:

Board Approval of the Strategic Report

The Strategic Report has been approved and signed on behalf of the Board by:

Adam Smith Chairman 28 October 2026

Statement of Directors’ Responsibilitiesin respect of the Annual Report and the Financial Statements

The directors are responsible for preparing the Annual Report and the Group and parent Company Financial Statements in accordance with applicable law and regulations.

Company law requires the directors to prepare Group and parent Company financial statements for each financial year. Under that law they are required to prepare the Group financial statements in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and in accordance with the UK adopted international accounting standards. The directors have elected to prepare the parent Company financial statements in accordance with UK accounting standards, including FRS 101 Reduced Disclosure Framework and applicable law.

Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and parent Company and of their profit or loss for that period. In preparing each of the Group and parent Company financial statements, the directors are required to:

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group’s and the parent Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and the parent Company and enable them to ensure that its financial statements comply with the Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and the parent Company and to prevent and detect fraud and other irregularities.

Under applicable law and regulations, the directors are also responsible for preparing a Strategic Report, Directors’ Report, Directors’ Remuneration Report and Corporate Governance Statement that complies with that law and those regulations.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

We confirm that to the best of our knowledge:

On behalf of the Board

Adam Smith Chairman 28 October 2026

Financial Statements

Consolidated Statement of Comprehensive Income

For the year ended 30 June 2026

All items in the above statement are derived from continuing and total operations. No operations were acquired or disposed of during the year.

The accompanying Notes 1 to 20 form part of these consolidated financial statements.

Consolidated Statement of Financial Position

At 30 June 2026

The accompanying Notes 1 to 20 form part of these Consolidated Financial Statements.

The Consolidated Financial Statements were approved by the Board of Directors on 28 October 2026 and were signed on its behalf by:

Adam SmithChairmanCompany number: 10727886

Consolidated Statement of Changes in Equity

For the year ended 30 June 2026

Consolidated Statement of Cash Flows

For the year ended 30 June 2026

The accompanying Notes 1 to 20 form part of these consolidated financial statements.

Notes to the Consolidated Financial Statements

for the year ended 30 June 2026

1. Corporate Information

Alternative Income REIT PLC (the ‘Company’) is a public limited company and a closed ended Real Estate Investment Trust (‘REIT’) incorporated on 18 April 2017 and domiciled in the UK and registered in England and Wales. The registered office of the Company is The Scalpel, 18th Floor, 52 Lime Street, London, United Kingdom, EC3M 7AF.

The Company’s Ordinary Shares are listed on the closed-ended investment funds category of the Official List of the Financial Conduct Authority (‘FCA’) and have been traded on the Main Market of the London Stock Exchange since the Company’s IPO on 6 June 2017.

The nature of the Group’s operations and its principal activities are set out in the Strategic Report.

2. Accounting policies

2.1 Basis of preparation

These consolidated financial statements (the ‘financial statements’) are prepared and approved by the directors in accordance with UK adopted International Accounting Standards (‘IFRS’) and in accordance with the Companies Act 2006 as applicable to companies reporting under those standards and the UK adopted International Accounting Standards (‘IAS’) Regulations.

These financial statements have been prepared under the historical cost convention, except for investment properties that have been measured at fair value.

The financial statements are presented in Pound Sterling (£) and all values are rounded to the nearest thousand pounds (£’000), except where otherwise indicated.

Basis of consolidation

The financial statements incorporate the financial statements of the Company and its subsidiaries (the ‘Group’).

Subsidiaries are the entities controlled by the Company, being Alternative Income Limited and Alternative Income REIT Holdco Limited.

New standards, amendments and interpretations, and forthcoming requirements

Standards effective from 1 July 2025

Certain new accounting standards and interpretations have been published that are not mandatory for annual periods beginning after 1 July 2025 and early application is permitted; however, the Group has not early adopted the new or amended standards in preparing these consolidated financial statements:

- IFRS 1 First-time Adoption of International Financial Reporting Standards;

- IFRS 7 Financial Instruments: Disclosures and its accompanying Guidance on implementing IFRS 7;

- IFRS 9 Financial Instruments;

- IFRS 10 Consolidated Financial Statements; and

- IAS 7 Statement of Cash flows

IFRS 18 will replace IAS 1 Presentation of financial statements for annual periods beginning on or after 1 January 2027. While IFRS 18 will not impact the recognition or measurement of items in the financial statements, including net asset value (‘NAV’), it will introduce significant changes to the presentation and disclosure requirements. The Group is currently assessing the impact of adopting IFRS 18 on its consolidated financial statements.

The Group is also evaluating the impact of the amendments to IFRS 9 and IFRS 7, particularly in relation to the classification of financial assets and enhanced disclosure requirements.

The other new standards and amendments listed above which are not yet effective are not expected to have a material impact on the Group in the current or future periods.

2.2 Significant accounting judgements and estimates

In the application of the Group’s accounting policies the directors are required to make judgements, estimates and assumptions that affect the reported amounts recognised in the financial statements. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability in the future. The estimates and associated assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are outlined below:

Valuation of investment properties

The fair value of investment properties is determined by external property valuation experts to be the estimated amount for which a property should exchange on the date of the valuation in an arm’s length transaction. The Group’s properties have been valued on an individual basis. The valuation experts use recognised valuation techniques, applying the principles of both IAS 40 and IFRS 13.

The valuations have been prepared in accordance with the Royal Institution of Chartered Surveyors (‘RICS’) Valuation. Factors include current market conditions, annual rentals, the contractual terms of the leases and their lengths and location. The significant methods and assumptions used by valuers in estimating the fair value of investment properties are set out in Note 10.

The information provided to the valuers, and the assumptions and valuation models used by the valuers, are reviewed by the Board and the Audit Committee.

Principal versus agent considerations – services to tenants

The Group arranges for certain services to be provided to tenants. These arrangements are included in the contract the Group enters into as a lessor. The Group has determined that it controls the services before they are transferred to tenants, because it has the ability to direct the use of these services and obtain the benefits from them. The Group has determined that it is primarily responsible for fulfilling these services as it directly deals with tenants’ complaints and is primarily responsible for the quality or sustainability of the services. In addition, the Group has discretion in establishing the price that it charges to the tenants for the specified services.

Therefore, the Group has concluded that it is the principal in these contracts. In addition, the Group has concluded that it transfers control of these services over time, as services are rendered by the third-party service providers, because this is when tenants receive and, at the same time, consume the benefits from these services.

REIT status

The Group is a REIT and does not pay tax on its property income or gains on property sales, provided that at least 90% of the Group’s property income is distributed as a dividend to shareholders, which becomes taxable in their hands. In addition, the Group has to meet certain conditions such as ensuring the property rental business represents more than 75% of total profits and assets. Any potential or proposed changes to the REIT legislation are monitored and discussed with HMRC. It is the Board’s intention that the Group will continue as a REIT for the foreseeable future.

2.3 Segmental information

Each property held by the Group is reported to the chief operating decision maker. In the case of the Group, the chief operating decision maker is considered to be the Board of Directors. The review process for segmental information includes the monitoring of key performance indicators applicable across all properties. These key performance indicators include Net Asset Value, Earnings per Share and valuation of properties. All asset cost and rental allocations are also reported by property. The internal financial reports received by the directors cover the Group and all its properties and do not differ from amounts reported in the financial statements. The directors have considered that each property has similar economic characteristics and have therefore aggregated the portfolio into one reportable segment under the provisions of IFRS 8.

2.4 Going concern

The financial statements have been prepared on a going concern basis.

The Group’s business activities, together with the factors likely to affect its future development, performance and position are set out in the Strategic Report. The robust financial position of the Group, its net asset and current asset positions, its cash flows, liquidity position and borrowing facilities are described in the financial statements and the accompanying notes. The financial statements also include the Group’s objectives, policies and processes for managing its capital, its financial risk management objective and its exposures to market price risk, real estate risk, credit risk and liquidity risk.

The Investment Adviser on behalf of the Board has projected the Group’s cash flows for the period up to 30 September 2029, challenging and sensitising inputs and assumptions to ensure that the cash forecast reflects a realistic outcome given the uncertainties associated with the current economic environment. A longer-term projection had also been carried out up to 30 June 2030. The scenarios applied were designed to be severe but plausible, and to take account of the availability of mitigating actions that could be taken to avoid or reduce the impact or probability of the underlying risks.

The Group refinanced its debt of £41 million on 20 October 2025 and the Group has reported full compliance with its loan covenants to date. Based on cash flow projections, the directors expect the Group to continue to remain compliant. The headroom of the loan to value covenant is significant and any reduction in property values that would cause a breach would be significantly more than any reduction currently envisaged.

The Group has borrowings of £41 million under a loan facility repayable on 20 October 2030 with HSBC. The HSBC Bank Facilities consist of both a fixed term loan of £31 million and a £10 million revolving credit facility, both on floating rates and on a fixed term of five years with an option to extend by two years if mutually acceptable. Details of the HSBC Bank Facilities are contained in Note 13 which include covenant details, all of which will be reported in accordance with the Group’s risk management procedures and policies.

Based on the above, the Board believes that the Group has the ability and resources to continue in operational existence for the foreseeable future, being at least 12 months from the date of approval of the financial statements.

2.5 Significant accounting policies

The principal accounting policies applied in the preparation of these financial statements are set out below.

a) Functional and presentational currency

These financial statements are presented in Pound Sterling (£), which is the functional and presentational currency of the Group and its subsidiary undertakings. The functional currency of the Group and its subsidiaries is principally determined by the primary economic environment in which it operates. The Group did not enter into any transactions in foreign currencies during the period.

b) Revenue recognition

i) Rental income

Rental income under operating leases is recognised on a straight-line basis over the term of the lease, except for contingent rental income, which is recognised when it arises. For leases, which contain fixed or minimum uplifts, the rental income arising from such uplifts is recognised on a straight-line basis over the lease term.

Incentives for lessees to enter into lease agreements are spread evenly over the lease term, even if the payments are not made on such a basis. The lease term is the non-cancellable period of the lease together with any further term for which the tenant has the option to continue the lease, where, at the inception of the lease, the directors are reasonably certain that the tenant will exercise that option.

Lease modifications, such as lease extensions and rent reductions, are accounted for either as a separate lease or not as a separate lease.

A modification will only be treated as a separate lease if it involves the addition of one or more underlying assets at a price that is commensurate with the standalone price of the increase in scope. All other modifications are not treated as a separate lease.

If a modification is a separate lease, a lessee applies the requirements of IFRS 16 to the newly added asset, due as a result of the modification, independently of the original lease. The accounting for the original lease continues unchanged.

If a modification is not a separate lease, the accounting reflects that there is a linkage between the original lease and the modified lease. The existing lease liability is remeasured with a corresponding adjustment to the right-of-use asset on the effective date of the modification.

ii) Service charges and direct recharges

Revenue from service charges is recognised in the accounting period in which the service is rendered. For certain service contracts, revenue is recognised based on the actual service provided to the end of the reporting period as a proportion of the total services to be provided because the customer receives and uses the benefits simultaneously.

iii) Deferred income

Deferred income is rental income received in respect of future accounting periods.

iv) Dilapidation and lease surrender premium

Amounts received from tenants to terminate leases or to compensate for dilapidations are recognised in the Consolidated Statement of Comprehensive Income when the right to receive them arises.

c) Financing income and expenses

Financing income comprises interest receivable on funds invested. Financing expenses comprise interest and other costs incurred in connection with the borrowing of funds. Interest income and interest payable are recognised in profit or loss as they accrue, using the effective interest method which is significantly the same as the contracted interest.

d) Investment property

Property is classified as investment property when it is held to earn rentals or for capital appreciation or both. Investment property is measured initially at cost including transaction costs. Transaction costs include transfer taxes and professional fees to bring the property to the condition necessary for it to be capable of operating. The carrying amount also includes the cost of replacing part of an existing investment property at the time that cost is incurred if the replacement of that part will prolong or improve the life of the asset.

Subsequent to initial recognition, investment property is stated at fair value. Gains or losses arising from changes in the fair values are included in profit or loss, included as part of operating profit under change in fair value of investment properties.

Additions to properties include costs of a capital nature only. Expenditure is classified as capital when it results in identifiable future economic benefits, which are expected to accrue to the Group. All other property expenditure is expensed in the Group profit or loss as incurred.

Investment properties are valued by the external valuer. Any valuation of investment properties by the external valuer must be undertaken in accordance with the current issue of RICS Valuation – Professional Standards (the ‘Red Book’).

The determination of the fair value of investment property requires the use of estimates such as future cash flows from assets (such as lettings, tenants’ profiles, future revenue streams, capital values of fixtures and fittings, plant and machinery, any environmental matters and the overall repair and condition of the property) and yield applicable to those cash flows.

For the purposes of the financial statements, the assessed fair value is:

- reduced by the carrying amount of any accrued income resulting from the spreading of lease incentives; and

- increased by the carrying amount of leasehold obligations.

Investment property is derecognised when it has been disposed of or permanently withdrawn from use and no future economic benefit is expected after its disposal or withdrawal.

The profit on disposal is determined as the difference between the net sales proceeds and the carrying amount of the asset at the commencement of the accounting period plus capital expenditure in the period. Any gains or losses on the retirement or disposal of investment property are recognised in profit or loss in the year of retirement or disposal.

e) Cash and cash equivalents

Cash and short-term deposits in the Consolidated Statement of Financial Position comprise cash at bank and short-term deposits with an original maturity of three months or less.

f) Receivables and prepayments

Rent and other receivables are initially recognised at fair value and subsequently at amortised cost. Impairment provisions are recognised based on the process as described in Note 2.2. Any adjustment is recognised in profit or loss as an impairment gain or loss.

g) Other payables and accrued expenses

Other payables and accrued expenses are initially recognised at fair value and subsequently held at amortised cost.

h) Interest bearing loans and borrowings

All loans and borrowings are initially recognised at fair value less directly attributable transaction costs. After initial recognition, interest bearing loans and borrowings are subsequently measured at amortised cost using the effective interest method. Borrowing costs are included in the effective interest rate calculation.

i) Provisions

A provision is recognised in the Consolidated Statement of Financial Position when the Group has a present legal or constructive obligation as a result of a past event that can be reliably measured and is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects risks specific to the liability.

j) Dividend payable to shareholders

Dividends due to the Company’s Shareholders are recognised when they become legally payable, as a reduction in the Consolidated Statement of Changes in Equity. Interim equity dividends are recognised when paid. Final equity dividends will be recognised when approved by Shareholders at an AGM. The Directors consider the aggregate of distributable reserves in considering the recommendation and payment of a dividend.

k) Share issue costs

The costs of issuing or reacquiring equity instruments (other than in a business combination) are accounted for as a deduction from equity.

l) Lease obligations

Lease obligations relate to the head rent of investment property and are capitalised at the lease commencement, at the lower of fair value of the property and present value of the minimum lease payments and held as a liability within the Consolidated Statement of Financial Position. The lease payments are discounted using the interest rate implicit in the lease. Where the Group is exposed to potential future increases in variable lease payments based on an index or rate, these are not included in the lease liability until they take effect. Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

m) Taxes

Corporation tax is recognised in profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

As a REIT, the Group is exempt from corporation tax on the profits and gains from its investments, provided it continues to meet certain conditions as per REIT regulations.

Taxation on the profit or loss for the period which is not exempted under UK REIT regulations comprises current and deferred tax. Current tax is expected tax payable on any non-REIT taxable income for the year, using tax rates applicable in the year.

Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred tax that is provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantially enacted at the period end date.

n) Non-current assets held for sale

Non-current assets are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction and a sale is considered highly probable. Investment properties classified as such are measured at fair value.

o) European Public Real Estate Association (‘EPRA’)

The Group has adopted the EPRA best practice recommendations. For the year ended 30 June 2026, audited EPS and NAV calculations under EPRA’s methodology are included in Note 8 and further unaudited measures are included following the financial statements.

p) Capital and reserves

Share capital

Share capital is the nominal amount of the Company’s ordinary shares in issue and is non-distributable.

Capital reserve

The capital reserve represents the cancelled share premium less dividends paid from this reserve. It is a distributable reserve. The share premium account was cancelled in 2017 by Court Order and distributions can be made from this reserve in accordance with the Companies Act 2006, including by way of dividends or share buy backs.

Retained earnings

Retained earnings represent the cumulative net gains and losses recognised in the Consolidated Statement of Comprehensive Income less dividends paid from this reserve. This reserve is distributable, except for any unrealised gains on investment properties.

2.6 Fair value measurement

The Group measures financial and non-financial assets such as investment properties at fair value at each reporting date.

A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair value is defined in IFRS 13 Fair Value Measurement as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair values have been determined for measurement and/or disclosure purposes based on methods described below. Where applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs significant to fair value measurement as a whole:

Fair value hierarchy:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

There were no transfers between any of the levels during the year.

Investment property

The valuation of investment property by valuers engaged by the Group who are independently appointed and have the relevant professional qualifications and with recent experience in the location and category of the investment property being valued. Further information in relation to the valuers is provided in Note 10.

Property valuations are inherently subjective as they are made on the basis of assumptions made by the valuer which may not prove to be accurate. For these reasons, and consistent with EPRA’s guidance, the valuations of the property portfolio have been classified as Level 3 as defined by IFRS 13. The inputs to the valuations are defined as ‘unobservable’ by IFRS 13 and these are analysed in Note 10.

3. Rental and other income

All rental, service charges, direct recharges and other income are derived from the United Kingdom.

* Included in Gross rental income is a lease surrender premium of £335,000 (2025: £nil) which is non-recurring in nature.

4. Expenses

* During the year, the Company incurred £0.73 million (2025: £nil) of professional advisory, legal, corporate finance and other costs in connection with evaluating and responding to a number of unsolicited takeover and corporate proposals. These costs are non-recurring in nature.

5. Directors’ remuneration

A summary of the director’s remuneration is set out in the Directors’ Remuneration Report in the Annual Report.

The Group had no employees during the year.

6. Finance expenses

Interest payable on loan consists of £1,452,000 to HSBC UK Bank Plc and £398,000 to Canada Life. Amortisation of finance costs consists of £129,000 with HSBC plc and £45,000 with Canada Life (2025: £128,000 with Canada Life).

7. Taxation

The Group maintained its REIT status and as such, no deferred tax asset or liability has been recognised in the current year.

Factors that may affect future tax charges

Due to the Group’s status as a REIT and the intention to continue meeting the conditions required to retain approval as a REIT in the foreseeable future, the Group has not provided deferred tax on any capital gains or losses arising on the revaluation or disposal of investments.

8. Earnings per share (‘EPS’)and Net Asset Value (‘NAV’) per share

* Adjusted EPS is a measure used by the Board to assess the level of the Group’s dividend payments. This metric adjusts EPRA earnings for non-cash items in arriving at an adjusted EPS as supported by cash flows.

Earnings per share are calculated by dividing profit/(loss) for the year attributable to ordinary equity holders of the Company by the weighted average number of Ordinary Shares in issue during the year. As at 30 June 2026 and 2025, there are no dilutive or potentially dilutive equity instruments in existence.

EPRA Net Reinstatement Value (‘NRV’), EPRA Net Tangible Assets (‘NTA’) and EPRA Net Disposal Value (‘NDV’)

9. Dividends

* Dividends declared after the year end are not included in the financial statements as a liability.

10. Investment properties

Disposal and acquisition of investment property

The property known as Crawley was sold in October 2025 for £4.5 million as shown in the reconciliation below of the gain recognised on disposal through the Condensed Consolidated Statement of Comprehensive Income; the gain on disposal includes changes in fair value of the investment property and minimum rent indexation spreading recognised in previous periods.

There were no property acquisitions in the year.

Valuation of investment properties

Valuation of investment properties is performed by Knight Frank LLP, an accredited external valuer with recognised and relevant professional qualifications and recent experience of the location and category of the investment property being valued. The valuation of the Group’s investment properties at fair value is determined by the external valuer on the basis of market value in accordance with the internationally accepted RICS Valuation – Professional Standards (incorporating the International Valuation Standards).

The determination of the fair value of investment properties requires the use of estimates such as future cash flows from assets (such as lettings, tenants’ profiles, future revenue streams, capital values of fixtures and fittings, plant and machinery, any environmental matters and the overall repair and condition of the property) and yield applicable to those cash flows.

Sensitivity analysis to significant changes in unobservable inputs within Level 3 of the fair value hierarchy

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy of the entity’s portfolios of investment properties are:

Increases/(decreases) in the ERV (per sq. ft. per annum) in isolation would result in a higher/(lower) fair value measurement. Increases/(decreases) in the yield in isolation would result in a lower/(higher) fair value measurement.

The significant unobservable inputs used in the fair value measurement, categorised within Level 3 of the fair value hierarchy of the portfolio of investment property and investments are:

*  Valuation per Knight Frank LLP.

** Hotels, petrol stations, residential and healthcare are excluded from this range.

Sensitivity analysis below: