AEW UK REIT (AEWU) Investor update summary

Strategic Overview and Investment Strategy

• Maintains a sector-agnostic value investment strategy focused on maximizing sustainable income and active asset management, targeting UK core plus commercial properties and consistently delivering a £0.02 per share quarterly dividend since IPO.

• Portfolio as of June 2026 includes 34 properties valued at £215.7 million, with a net initial yield of 7.28% and reversionary yield of 8.87%, indicating embedded rental growth potential.

• Low average book values (£81/sq.ft.) and passing rents (£6.72/sq.ft.) provide reversionary potential and downside protection.

• Highest sector weightings are in industrials and retail, with a focus on strong commercial locations rather than specific UK regions.

• Consistent dividend payments and strong cash position, supported by a £60 million debt facility at a fixed 2.96% rate expiring July next year and low leverage (27.8% LTV).

Performance Highlights

• Achieved annualised NAV total returns of 6.4% (1 year), 7.6% (5 years), and 9.5% (10 years), consistently outperforming the MSCI benchmark in total return over multiple time frames.

• Outperformed the MSCI benchmark by 5.9% over five years and 4.7% over ten years in property total return.

• Demonstrated resilience and outperformance through counter-cyclical buying and selective profit-taking across sectors.

• Average sale to purchase price premium of 41% on disposals, crystallising capital gains.

• Portfolio recognized with multiple awards, including six consecutive Citywire Awards for three-year NAV total return.

Asset Management and Portfolio Activity

• Achieved significant rental growth and value uplift through active management, including a 48% rent increase and 10-year lease renewal at St Helens industrial asset, adding £1.025m in valuation.

• Completed two new lettings at Runcorn, improving rents by over 42% and environmental performance, with EPC ratings upgraded from D to B.

• Letting at Queen's Square, Bristol, to IWG resulted in full occupancy and projected income growth exceeding ERV, with annual income forecast to nearly double by 2027.

• Disposed of a Cardiff nightclub at a premium to book value despite an overall loss, reallocating capital to more attractive opportunities.

• Ongoing asset management at Tanner Row, York, with continued income during administration and potential for alternative uses if needed.