Secure Property Development & Investment PLC/ Index: AIM / Epic: SPDI / Sector: Real Estate

26 July 2017

Secure Property Development & Investment PLC ("SPDI" or "the Company")

Profitable Disposal of Land in Bucharest

Secure Property Development and Investment PLC (AIM: SPDI), the South Eastern European focused property and investment company, is pleased to announce the disposal of Delia Lebada ("the Disposal"), a ~40,000 sqm (4 hectare) plot of land in east Bucharest on the shore of Pantelimon Lake.  SPDI owned a 65% share of Delia Lebada of which the attributable sale proceeds are approximately €2.5 million.  Simultaneously, SPDI has also settled the associated property loan with the Bank of Cyprus totalling more than €6.5 million through a liquidation process, whereby SPDI repaid the loan at a rate of 45 cents / Euro (totalling ~€3 million) using a combination of the Land Disposal proceeds (€2.5 million) and an additional payment of approximately €550,000.

Overview

·       The Disposal and loan settlement is expected to register a one time gain in excess of €3 million in SPDI's 2017 Financial Statements

·       Removal of debt more than €6.5 million, together with an associated corporate guarantee, further strengthens the Company's balance sheet - operational gearing, which stood at 46% as at 31 December 2016, is expected to fall

·       SPDI to maintain exposure to the upside potential of Delia Lebada - the Company will retain a 5% interest in the Special-Purpose Vehicle ("SPV") which will hold the land asset post Disposal debt free 

·        The Disposal is in line with the Company's strategy to focus on income producing assets in high-yielding South Eastern European countries such as Romania and Greece. SPDI's core income producing portfolio includes logistics terminals in Athens and Bucharest, offices in Bucharest, as well as a retail BigBox in Craiova, Romania

SPDI CEO Lambros Anagnostopoulos commented, "The profitable Disposal and elimination of associated property loan of Delia Lebada further demonstrates the management team's skill at executing transactions on favourable terms for shareholders.  Not only have we substantially reduced our interest in this well-located but not yet income generating property but we have agreed with the lending bank to eliminate the associated debt substantially below its nominal value whilst at the same time retaining a small 5% interest to take advantage of any upside potential.

"This profit generating and debt reducing transaction follows swiftly on from our conditional sale of another very well located land asset in central Kiev in Ukraine (as announced on 4 July), which, if consummated, will generate more than ~ US$3 million in cash, and earlier this year the completion of the sale of the Terminal Brovary warehouse in Kiev, which generated a profit for SPDI of ~€2.7 million, as well as a cash inflow of ~€3.5 million.  We are delivering on our strategy to generate value through the active management of all our property assets, including non-core ones, as we focus on positioning SPDI as the leading London listed property company focused on selected South East European countries."   

Further Information on Delia Lebada, Romania

The site consists of a ~40,000 sqm plot of land in east Bucharest situated on the shore of Pantelimon Lake, opposite a famous Romanian hotel, the Lebada Hotel. The lake itself, having a 360 Ha surface, is the largest lake of Bucharest and accommodates many leisure activities such as fishing, cycling, walking, etc. At the back of the property there is a forest which transforms the area into a very attractive habitat for families and adds value to the residential units to be developed.  The construction permit, which allows for ~54,000 sqm to be built, was renewed in April 2014 and is currently under an additional renewal.

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Notes to Editors

Secure Property Development and Investment plc is an AIM listed property development and investment company focused on the South East European markets.  The Company's strategy is focused on generating healthy investment returns principally derived from: the operation of income generating commercial properties and capital appreciation through investment in high yield real estate assets.  The Company is focused primarily on commercial and industrial property in populous locations with blue chip tenants on long term rental contracts.  The Company's senior management consists of a team of executives that possess extensive experience in managing real estate companies both in the private and the publicly listed sector, in various European countries.