Elite Commercial REIT has signed agreements with the government to regear 100 leases and inject £12.5m into its portfolio.
The asset enhancement works will affect assets in the REIT’s portfolio that are occupied by the Department for Work and Pensions, and will target sustainability and climate adaptation requirements.
Under the terms of the agreement, the REIT will invest £12.5m over three years towards asset enhancement works to improve sustainability and energy efficiency credentials of properties in its portfolio that are currently occupied by DWP.
A total of 117 of Elite Commercial’s properties are occupied by the DWP, which accounts for approximately 57.3% of the total portfolio.
Lease break options have been removed from 100 of them, allowing the lease to run uninterrupted until 2028. The capital injection comes despite the DWP holding the properties on full repairing and insuring leases.
CEO Shaldine Wang said: “We are pleased to embark on this public-private collaborative effort, which came about as a result of our regular proactive engagement with the DWP. We fully support the UK government’s push for transition to net zero carbon emissions. Investing in retrofitting works to enhance the energy efficiency ratings of assets in the portfolio will contribute towards reducing their environmental impact. This win-win initiative demonstrates our commitment to adapt our portfolio to address sustainability and climate change requirements, and to extend the relevance of our assets to tenants.”
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