Disposal of Sutton Investment & Portfolio Update

For Immediate Release 29 January 2015

LXB RETAIL PROPERTIES PLC

(the "Company" or the "Group")

Disposal of Investment at Sutton and Portfolio Update

The Group, a Jersey resident closed-ended real estate investment company focused on edge of town and out of town retail assets, today provides the following update on progress in the investment portfolio since the 2014 Results Announcement on 18 December 2014.

Highlights

The Group previously indicated that it was in discussions which may lead to the disposal of three separate investments for cash proceeds in excess of £140m either on signing or when all post contractual conditions are satisfied. Contracts have now been exchanged for the first of those transactions, the disposal of the Sainsbury's foodstore and the residential land at Sutton. A total value of approximately £47.83m is expected to be received in stages with an initial cash consideration of £23.625m by May 2015 on satisfaction of the contractual conditions. Discussions concerning the other two potential investment disposals continue.

Additionally, good progress has been achieved on lettings across the portfolio. Since the Results Announcement the Group has concluded five new pre-lets covering 77,671 sq ft of space (56,185 sq ft on ground floor) at Biggleswade, Greenwich Brocklebank, Rushden Lakes and Stafford. These add £1.47m to the annual contracted future rent roll.

The Group also reports on planning outcomes at Rushden Lakes and Truro.

Disposal of Investments at Sutton

The Group has exchanged two contracts to dispose of a substantial part of its investments at Sutton. Both sales are expected to complete by May 2015 when a number of conditions (relating primarily to site remediation and discharge of planning related obligations) have been satisfied.

The Sutton investments comprise a foodstore which is pre-let to Sainsbury's and two residential blocks which have planning consent for 181 apartments, five town houses and 27,500 sq ft of open A1 retail space in nine units on the ground floor.

The foodstore investment has been sold to The Lime Property Fund which is managed by Aviva Investors. The site remediation works started in December 2014 and the conditionality in the contract is expected to be satisfied by May 2015 at which time initial cash proceeds of £20m will be received. The new owners will fund the foodstore construction which will start as soon as the remediation has been completed. The Group has agreed to oversee the development and will receive a further amount from the purchaser at completion of the foodstore which is scheduled for April 2016.

Contracts have also been exchanged with Linden Homes, the housebuilding arm of Galliford Try Plc, to dispose of the residential element of the scheme for a cash consideration of £12.5m (less a deduction for utilities connections which is not expected to exceed £150k). In addition to the cash receipts, Linden Homes will also fund the construction of the ground floor retail units and grant a 999 year lease on the ground floor retail units back to the Group (at nil premium and a peppercorn rent) when the residential towers are completed. This sale is also expected to complete by May 2015 when the demolition works finish and the planning related conditions have been discharged. Cash of £3.625m will be received on completion with the remainder being received in instalments throughout 2015.

Taking into account the cash proceeds and the value of the 999 year lease on the retail units, the Group estimates the total value of these two disposals to be approximately £47.83m which represents a further uplift to NAV of approximately £4.5m since the September 2014 balance sheet. This additional NAV is expected to be realised in the Group's results in the next two financial years and mainly in the current year.

An update on other progress achieved since the Results Announcement last December appears below.

Biggleswade

The December statement reported that further pre-lettings at the A1 Retail Park were under discussion adding to a tenant line-up which already included M&S, Next, Arcadia, River Island, TK Maxx, Matalan, Laura Ashley, Halfords, Bensons and Pets at Home. Pre-lets have recently been agreed with H&M for a 19,500 sq ft (10,000 sq ft on ground floor) unit and Boots for a 15,000 sq ft unit. A further pre-let of a 6,500 sq ft store is expected to complete imminently at which point both Phases 1 and 2 will be fully pre-let. This will leave just 4 units totalling 35,500 sq ft (on ground floor) to let in the final phase of the main scheme and active discussions are being held with several potential retail tenants. The Group is confident that this remaining space will be fully let by the time it is ready for occupation in March 2016. In addition to the main A1 Retail Park, the Group also has another investment site opposite, which has planning permission for a further 30,000 sq ft of A1 non-food retail use.

Greenwich Brocklebank

A pre-let has been agreed with Aldi for a 19,500 sq ft (17,150 sq ft on ground floor) store meaning that with the existing pre-let of a 38,500 sq ft three storey (16,000 sq ft on ground floor) unit to Next, 44% of the ground floor space at this four unit scheme is now pre-let. The Group expects to sign a further pre-letting with a major fashion retailer for a 60,000 sq ft (30,000 sq ft on ground floor) store in the near future. At that point 83% of the ground floor space at this investment will have been committed to tenants.

Rushden

A pre-let has been agreed with H&M to take 19,500 sq ft of space (10,000 sq ft on ground floor) taking the space committed to tenants to 81,500 sq ft (42,000 sq ft on ground floor) and detailed discussions are continuing with a number of other retailers. Interest in Rushden Lakes remains high and the Group hopes to conclude the next phase of the letting strategy in the next couple of months.

A resolution to vary the existing planning permission was granted in December 2014 allowing a reconfiguration of the retail units, changes to the façade treatment of the three main retail terraces and the provision of five further restaurants taking the total number of restaurants to eight. The scheme revisions also include provision of a further 154 car parking spaces.

Stafford

The first significant pre-letting of one of the units within the leisure element of the Riverside scheme has been concluded with Chiquito agreeing to occupy a unit of just over 4,000 sq ft. Pre-lets of two further restaurant units within the leisure element are currently in solicitors' hands and offers have been received in respect of all of the remaining leisure accommodation.

Truro

The Group's Living Villages planning application came before Cornwall Council's planning committee in December 2014. It includes a 70 acre community farm to be run as an educational facility by Duchy College, a restaurant and cookery school to be run as a training facility by Cornwall Food Foundation, and a village of 155 new homes.

The application was made after a significant local consultation exercise which showed overwhelming public support for the proposal. Even though the planning officers recommended approval and raised no technical objections, the planning committee chose to refuse the application purely on grounds relating to the wider highways network which the Group considers to have no substance. The Group is exploring the most pragmatic way forward.

Commenting on these updates Tim Walton, CEO of LXB Adviser LLP, said:-

'The Chairman's Statement on 18 December 2014 outlined the high level of activity across the whole portfolio as the Group turns the potential in the portfolio into recognisable NAV. That momentum has continued with this very strong start to 2015 and I am confident there will be more positive news to report over the coming few months.

The planning outcome at Truro is a disappointment because, at the very least, it will delay LXB's ability to take Living Villages from a great concept to a real demonstration of a different way to deliver new places for people to live in a way which generates value for local communities, as well as for shareholders. Although the outcome is frustrating, shareholders will recall that the Group successfully overcame significant planning challenges to the investments at Banbury and Rushden and can be assured that the same determined approach will be followed in relation to the Living Villages application'.

For further information please contact:

LXB Adviser LLP Tel: 020 7432 7900

Tim Walton, CEO

Brendan O'Grady, FD

J.P. Morgan Cazenove (NOMAD) Tel: 020 7742 4000

Bronson Albery/Kristof Vashegyi

Buchanan Tel: 020 7466 5000

Charles Ryland/Sophie McNulty