Real Estate Investors open to sale of whole portfolio as sales progress

Real Estate Investors plc (REI) has announced progress in its sales and debt repayment programme, despite an extremely challenging sales environment.

The Birmingham-based real estate investment trust anticipates the completion of sales scheduled in the fourth quarter of the year, combined with its legal pipeline of sales will repay the company’s entire debt in full.

In a trading update published ahead of REI’s interim results to June 30, which will be published on September 30, the company said REI had continued to make progress, despite “tough” market conditions.

Chief executive Paul Bassi said: “Since placing assets on the market in April 2026, and despite the challenging backdrop, the diversity of our portfolio has enabled us to place £15.7 million under offer and in legals, of which £10.7 million has unconditionally exchanged or legally completed at 92 per cent of December 2025 book value.

“Asset management initiatives are continuously underway on larger assets, with these sales scheduled to be placed on the market in the fourth quarter of 2026.

“We continue to operate in an extremely challenging sales environment and have seen some sales in the first six months of 2026 despite the USA/Israel/Iran conflict and continued interest rate volatility.

“Despite a tough marketplace, and subject to ongoing market conditions, we anticipate the repayment of our debt from our legal pipeline and scheduled further sales and remain resolutely focused on returning capital to shareholders which will commence immediately after the repayment of the company’s borrowings.”

He added that REI remained open to a corporate transaction that will deliver shareholder value and a more rapid conclusion to the company’s stated strategy.

Mr Bassi said REI has a strong legal pipeline of new lettings and contracted new lettings of just under £400,000 per annum. Once all of these have completed, portfolio occupancy, subject to further sales, will rise to 82.20 per cent (full year 2025: 78 per cent), with the potential to enhance asset values prior to sale.

The portfolio continues to deliver contracted annual rental income of £7.7 million per annum rising to £8.1million per annum following the completion of pipeline lettings.

Rent collection remains strong, with 99.01 per cent collected year-to-date and 99.33 per cent collected for the current quarter.

In the year to date, REI’s asset management team has completed 15 lease events, including transactions with large occupiers and household name businesses such as Matalan, Argos, Popeyes and McDonalds.

Capital receipts from disposals and existing cash have been directed towards debt repayment of £5 million, reducing total debt to £31 million as at 30 June 2026 and £29.2 million as of(August 21 2026, against 2025’s full year figure of £34.2 million.

This is set to reduce further in mid-October 2026 to £24 million with the legal completion of assets that have unconditionally exchanged with a deferred completion date. In the meantime, REI continues to benefit from the rental income on the assets. Further completion of sales in REI’s legal pipeline or that are under offer will further cut debt.

Mr Bassi added: “As we have previously stated, we believe that a debt-free portfolio will also attract regional property company buyers to its geographical focus, income generation and asset base that will support acquisition debt.

“We remain open to a corporate event that provides a speedier conclusion to our stated disposal and wind down strategy, conditional upon delivering positive shareholder value.”