AEW UK REIT (AEWU) investor relations material

Strategy and investment approach

• Sector-agnostic value investing with a focus on counter-cyclical buying and selling to exploit market mispricing.

• Active asset management is central, aiming to deliver consistent dividends and unlock capital upside.

• Diversification across sectors and regions, with recent rotation from industrials to high-yielding retail assets.

• Emphasis on timing sales to maximize value and recycling capital into new opportunities.

• Strong conviction in the strategy's ability to outperform, supported by a robust pipeline of assets yielding 8.5%-9%+.

Portfolio performance and financials

• Portfolio valued at £215.7 million as of June, with 34 commercial assets and 130 tenants.

• Net initial yield at 7.28%, reversionary yield at 8.87%, and vacancy rate at 6.5%.

• 42 consecutive quarters of 2p per share dividend, equating to an 8% annual yield.

• Loan to GAV at 25% with a £60 million debt facility at 2.96% fixed until July 2027.

• Portfolio outperformed the MSCI benchmark over multiple periods, with property-level returns more than double the benchmark except for the most recent 12 months.

Asset management and case studies

• Industrial assets acquired at low capital values, with significant rental growth achieved through lease renewals and refurbishments.

• Example: Lease renewal in St Helens increased rent by 42% and asset value by over £1 million.

• Multi-let industrial estate in Runcorn saw rents rise from £6.50 to over £9 per sq ft after refurbishment.

• Average capital value per sq ft for industrials is £48, well below new build costs, supporting strong value proposition.

• Bristol office asset doubled rent per sq ft over 11 years through active management and location focus.