Legal & General : Urban&Civic sells Stansted hotel to Legal & General

17 October 2017

The new hotel opened for trading in late July 2017 and is one of only two that are on-terminal at Stansted. Initial occupancy levels and achieved room rates are running above pre-opening forecasts.

The minimum consideration represents a projected yield on stabilised EBITDA three years forward of 6.75 per cent and is 15 per cent higher than the EPRA valuation of the completed asset in the interim balance sheet as at 31st March 2017. Profit realised on actual cost is expected to be in the order of £8.5 million. Cash returned back into the business, after accounting for development project bank debt, will exceed £30.0 million.

Proceeds of the sale will be directed into the Master Development of further strategic projects in which Urban&Civic is now the market leader. Shareholders can anticipate the early announcement of investment in new large-scale projects, consistent with the Company's strategy to accelerate quality housing delivery in areas of high demand and population growth.

Commenting upon the sale Nigel Hugill, Chief Executive, said: 'The sale of Stansted represents an obviously strong outcome for the Group but the core reason for establishing Urban&Civic was to provide new housing choices and accelerate supply through Master Development. That involves creating environments in which people actively want to live and a delivery structure that encourages speed and quality from those housebuilders looking to expand output. The model can be seen to be working and is directly consistent with current Government policy. We shall be going all out from here.'

Tom Roberts, Head of Strategic Investment and Regeneration at LGIM Real Assets, said: 'The fundamentals of this hotel speak for themselves - being the closest hotel to Stansted airport's security gate, it offers absolute convenience to its guests. The high quality of the new development and the Hampton by Hilton brand, under which the hotel operates, were also major factors in our investment considerations. Since its opening a few months ago, the occupancy figures have been very encouraging and we strongly believe this asset will prove to be an attractive addition to our portfolio. We have seen increasing opportunities across the platform in acquiring alternative assets where we have found high-yielding properties in core strategic locations.'

LSH advised Legal & General on this transaction.

For further information, please contact:

Olivia Bayliss

Head of Communications, Legal & General Capital and LGIM Real Assets

020 3124 2777

Faye Walters

PR Manager, LGIM Real Assets

020 3124 2823

Notes to editors:

About LGIM Real Assets

LGIM Real Assets is a division of Legal & General Investment Management (LGIM), one of Europe's largest institutional asset managers and a major global investor. LGIM manages £951.1bn in assets on behalf of over 3,200 clients (as at 30 June 2017), providing products and solutions spanning all asset classes. LGIM Real Assets, headed up by Bill Hughes, has AUM of £24.9bn (as at 30 June 2017), actively investing and managing assets across commercial property, private residential, infrastructure and property lending and, most recently, corporate credit.

About Legal & General Group

Established in 1836, Legal & General is one of the UK's leading financial services groups and a major global investor. At 30th June 2017, we had over £951 billion in total assets under management. Over fifteen million customers worldwide rely on us to help them save for the future and to protect their families and their homes.

We work with companies and pension trustees to help people build security in retirement, being the UK's largest investment manager for UK corporate pension schemes, a major provider of auto-enrolled pensions and a market leader in pensions de-risking. We have also made a commitment to invest around £15 billion in direct investments, with over £12 billion already invested in areas such as homes, urban regeneration, clean energy and small business finance, driving economic growth and making a positive difference to the UK's built environment.

About Urban&Civic plc

Urban&Civic plc is an established UK property development and investment company listed on the London Stock Exchange's main market (UANC), with total assets valued at over £460 million (31 March 2017).

Headquartered in London and with a network of regional offices, Urban&Civic's team is led by Nigel Hugill, CEO, and Robin Butler, Managing Director. The Company has significant in-house expertise across site assembly, planning, project management, delivery, community engagement and sales.

Strategic land constitutes the core of Urban&Civic's business model where, as Master Developer, it owns or has the stewardship of over 4,500 acres across five sites located close to Cambridge, Huntingdon, Newark and Rugby. These sites will deliver more than 22,000 new homes, over six million sqft of business space, and at least eleven primary and three secondary schools over the next 15 to 20 years.

Proud to be defined by the quality of its projects, Urban&Civic is distinguished by its emphasis as Master Developer on the leveraged benefits that can be delivered from Strategic Sites. These include the creation of new jobs and enhanced skills as well as the delivery of real opportunities for local communities and stakeholders.