NAV update for the quarter to 30 June 2025

For release 5 August 2025

Schroder Real Estate Investment Trust Limited

NAV UPDATE FOR THE QUARTER TO 30 JUNE 2025

1.6% NAV TOTAL RETURN SUPPORTED BY EARNINGS GROWTH AND ACTIVE MANAGEMENT

Schroder Real Estate Investment Trust Limited ('SREIT' or the 'Company'), the actively managed REIT focused on improving the sustainability performance of buildings to generate higher income and capital growth, announces its 30 June 2025 net asset value ('NAV'), an asset management update, and further progress selling smaller non-core assets on completion of business plans.

Financial highlights

· NAV total return for the quarter of 1.6%

· NAV increase of 0.2% to £301.9 million or 61.7 pence per share ('pps')

· Annualised dividend yield of 6.8% on 4 August closing share price of 52.5p

· Quarterly EPRA earnings increased 7.3% to £4.4 million, or 0.9 pps

Balance sheet highlights

· Sector-leading debt terms with a weighted average maturity of 8.2 years and interest cost of 3.5% on drawn debt

· Incremental positive fair value benefit of the fixed-rate loan of £18.4 million, which is not reflected in the Company's NAV

· Net loan to value 36.5% (31 March 2025: 36.9%)

Operational highlights

· Quarterly portfolio capital growth of 0.3%

· Strong leasing momentum maintained since the Company announced its final results on 11 June 2025, with 10 deals completed across 52,000 sq ft:

o  Four new lettings of vacant units totalling £321,000 of annualised rent, 1% ahead of 30 June 2025 estimated rental value ('ERV')

o  Five lease renewals generating total rent of £281,000, which is 11% ahead of the previous passing level and 5% ahead of 30 June 2025 ERV

o  One rent review with a total rent of £100,000 which is 22% ahead of the previous passing level

· 39% reversion to the portfolio's ERV of £40.2 million from an annual rent of £29.0 million as at 30 June 2025, which is expected to further drive income and earnings growth

Dividend

· Quarterly dividend paid of £4.4 million, or 0.897 pps (31 March 2025: 0.897 pps)

· Quarterly dividend 100% covered by EPRA earnings (Year ended 31 March 2025: 100%)

· Interim dividend of 0.897 pps for the period 1 April 2025 to 30 June 2025 to be paid in August 2025

Alastair Hughes, Chair of the Board, commented: "Whilst investment and occupational market activity has remained largely subdued due to macro-economic and geopolitical headwinds, the Company has delivered another robust quarter of earnings growth, a fully covered dividend and further capital value appreciation in the portfolio. With our differentiated and active strategy, we are confident in our ability to continue driving rents across the portfolio, which is well positioned to benefit from the ongoing recovery of the UK real estate market."

Nick Montgomery, Fund Manager, added: "Our portfolio's alignment to higher growth sectors combined with an active asset management strategy has enabled us to deliver another period of positive financial and operational performance. We remain highly focused on delivering consistent earnings growth by capturing the portfolio reversion which should support the delivery of risk adjusted returns for shareholders in the long term."

NAV

A breakdown of the quarterly movement in the NAV is set out below:

Property portfolio

As at 30 June 2025, the underlying portfolio comprised 37 properties valued at £481.6 million. It generated annual rent of £29.0 million, reflecting a net initial yield of 5.6% (MSCI Benchmark: 5.1%[1]). Note that the University of Law, the tenant at Store Street in Bloomsbury, is in a 10-month rent free period ending on 16 October 2025. Adding back the Company's share of its annual rent, being £2,359,885, would result in a net initial yield of 6.1%. The portfolio's ERV is £40.2 million, reflecting a reversionary yield of 8.3% (MSCI Benchmark: 6.2%1).

Including the impact of the exchange of unconditional contracts to sell Pacific House in Marlow with vacant possession, the portfolio void rate has improved to 12.2% as at today (31 March 2025: 12.3%), calculated as a percentage of ERV. In addition:

· A further 2.3% of this void is currently under offer and in advanced legal negotiations.

· A further 2.9% is undergoing refurbishment including major sustainability improvement works at Millshaw Park Industrial Estate in Leeds (representing 1.7%) and St Ann's House in Manchester (representing 0.6%), both visited by shareholders and analysts on the Asset Tour in June and expected to generate material increases in rent compared to the previous passing level on completion.

The weighted average unexpired lease term, assuming all tenants vacate at the earliest opportunity, is 5.2 years.

The tables below summarise portfolio information as at 30 June 2025:

Sector weighting

Region weighting

Balance sheet and debt

The weighted average interest rate for total debt drawn at the quarter end was 3.5%, with an average maturity of 8.2 years, with 87% either fixed or hedged against movements in interest rates. The Company has significant headroom on all covenants. A summary of the key terms as at 30 June 2025 is in the table below:

As at 30 June 2025, the Company had cash, including cash held in joint ventures, of £8.1 million and a net loan to value ratio of 36.5%, slightly above the long-term strategic target range of 25% to 35%. The Company is taking steps to reduce the net loan to value ratio back in line with the target range, including two post quarter end disposals, and others in progress or planned.

Asset management

The Company continues to deliver on its asset management programme, with key activity since 11 June 2025 including:

Retail

· At Churchill Way West, a retail warehouse scheme in Salisbury, Wiltshire Council has granted planning permission for the unit reconfiguration required to bring Lidl Great Britain Limited ('Lidl') to the scheme. As previously reported, an agreement for lease exchanged with Lidl to occupy unit 1 and part of unit 2, totalling 22,400 sq ft, on a new 25-year lease (break at year 20) at £440,000 per annum or £19.81 per sq ft. This is 67% higher than the previous passing level on a per sq ft basis. Lidl will receive nine months of rent free and the lease will be subject to five yearly, inflation-linked reviews with a collar of 1% per annum and a cap of 3% per annum. Lease completion is subject to the Company delivering a unit split and refurbishment at an estimated cost of £1.5 million inclusive of consultant and legal fees. Lidl is required to install photovoltaic panels on the roof which will enable the overall project to achieve an EPC rating of 'A'.

Net zero carbon pathway

· In the latest annual report, we reported 5% year-on-year reductions in both landlord energy consumption and associated Scope 1 and 2 greenhouse gas ('GHG') emissions on a like-for-like basis, demonstrating progress against our target to reduce these to net zero by 2030. In addition, the Company is pleased to now report positive progress towards its target for operational whole building GHG emissions to be aligned to a 1.5°C global warming pathway by 2030. Independent assessment has determined a reduction in operational whole building GHG emissions intensity of 14% in calendar year 2024 compared to the 2023 baseline[3]. This has been supported by reductions in landlord energy consumption, continued tenant (Scope 3) data collection efforts, which supports our continual improvement in understanding actual building energy and energy-related GHG performance, and reducing reliance on the use of benchmarks.

Disposals

As noted in the annual report, during the quarter the Company completed the sale of 15/16 King Street, a Grade II listed freehold asset comprising two ground floor retail units in Truro, for £1.25 million. The price was 14% ahead of the 31 March 2025 independent valuation of £1.1 million. This follows the lettings of the ground floor retail units, with the price reflecting a net initial yield of 8.0%.

Post quarter end, the sale of 12/14 East Gates in Leicester, a Grade II listed freehold single let retail asset, completed on 23 July 2025 for £1.0 million. The price is 11% ahead of the 31 March 2025 independent valuation of £0.9 million and equal to the valuation as at 30 June 2025. The lease expires in 4.25 years, and the price reflects a net initial yield of 9.4%.

Also post quarter end, unconditional contracts have been exchanged to sell Pacific House in Marlow, a vacant freehold office asset, for £1.665 million. The price is 11% ahead of the 31 March 2025 independent valuation of £1.5 million and equal to the valuation as at 30 June 2025. The price reflects a capital value of £108 per sq ft.

As noted in the annual report, further disposals are under consideration.

-ENDS-

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