Press releases

Hercules Completes the Sale of Colne Valley Retail Park, Watford

07/07/2008

Hercules Unit Trust (“HUT”), the specialist retail warehouse fund advised by The British Land Company PLC and managed by Schroders announces that it has completed the sale of its Colne Valley Retail Park in Watford to Igal Ahouvi for £45.075 million reflecting a net initial yield of 6.59%.

Colne Valley Retail Park, located within a mile of Watford Town Centre, provides more than 88,000 sq ft of retail warehouse space across seven units. The units are let to tenants including Allied Carpets, DFS and MFI and have a predominantly bulky goods planning consent.

The scheme was originally acquired by HUT in July 2000 for £17.3 million representing an initial yield of 6.50%. In the intervening period the park has been reconfigured and extended with new lettings taking the best rent on the park to £40.00 psf. This has produced an ungeared IRR of 13.25% pa for the fund, which given the similar yields on acquisition and disposal, was achieved almost entirely through active asset management. IPD over the same eight year period returned 10.17% pa.

Commenting on the disposal, Andrew Jones, a Director of British Land, said:

“This sale is in line with our strategy to reduce our exposure to the bulky goods sub-sector and represents the latest in a number of transactions completed by HUT. It further demonstrates that there is still investor demand for good, well located retail parks in strong towns.”

Harvey Spack Field represented HUT. Barrs Freer Smith acted for Mr. Ahouvi

For further information:

The British Land Company PLC
Andrew Jones Tel: +44 (0)20 7486 4466

Schroders
Michael Clarke Tel: +44 (0)20 7658 6000

Financial Dynamics
Dido Laurimore/Jamie Robertson Tel: +44 (0)20 7831 3113

Hercules Unit Trust
HUT was created in September 2000 as a closed ended Jersey property unit trust to invest in retail warehouses and shopping parks throughout the United Kingdom. HUT’s objective is to achieve an annual ungeared total return above the IPD UK Retail Warehouse Index over the life of the Trust. HUT had an initial life of ten years from September 2000. This has been extended to 2020 following unitholder approval.

HUT is the UK’s largest specialist retail warehouse property unit trust with a property portfolio of £2.4 billion comprising of 24 retail and shopping parks (as at June 2008), including Glasgow Fort Shopping Park, Glasgow; and Fort Kinnaird Shopping Park, Edinburgh. The portfolio totals 5.6 million sq ft of retail park space and key tenants include Next, Boots, Arcadia, Marks & Spencer, Argos, DSG, Sports World and B&Q.

For further information: www.schroders.com/hercules

British Land is the largest UK REIT by assets (£14.6 billion) with total assets under management of £18.4 billion, as at December 2007. British Land’s share of the Hercules Unit Trust is 36.3% as at March 2008. For more details visit www.britishland.com

Schroders Property Business
Schroders has managed property funds since 1971 and has almost £8.9 billion (€11.1bn / US$17.6bn) of gross property assets under management (at 31 March 2008), excluding crossholdings.

The Schroders property team consists of over 130 individuals across nine offices located in London, Wiesbaden, Amsterdam, Milan, Jersey, Paris, Luxembourg, Stockholm and Hong Kong. The team is experienced in property fund management, research and strategy, investor relations, finance and administration. The team also benefits from the significant resources of the Schroders Group. For further information about Schroders’ property business visit www.schroderproperty.com

Schroders
Schroders is a global asset management company with £130.6 billion (€163.8 billion / $259.6 billion) under management at 31 March 2008. Our clients are major financial institutions including pension funds, banks and insurance companies, local and public authorities, governments, charities, high net worth individuals and retail investors.

We apply our specialist asset management skills in serving the needs of our clients worldwide. With one of the largest networks of offices of any dedicated asset management company and over 300 portfolio managers and analysts covering all the major investment markets, we offer our clients a comprehensive range of products and services.

Further information about Schroders can be found at www.schroders.com

Issued by Schroder Property Investment Management Limited, which is authorised and regulated by the Financial Services Authority. For regular updates by email please register online at www.schroders.com for our alerting

Jersey based specialist property unit trusts are becoming an increasingly attractive property investment route for institutional investors. These trusts offer a low cost tax transparent way of gaining an exposure to property portfolios which, because of capital constraints, may otherwise not be available to them. Investors benefit from the unit trust being managed by specialists in the relevant sector who are highly incentivised to perform by their co investment in the trust.

HUT is a collective investment scheme within the meaning of Section 235 of the Financial Services and Markets Act (“FSMA”). It is not an authorised unit trust scheme, OEIC or recognised scheme within the meaning of the FSMA and therefore constitutes an unregulated collective investment scheme. As an unregulated collective investment scheme, the distribution and promotion of units are restricted, for the purposes of Sections 21 and 238 of the FSMA, to persons who are themselves authorised under the FSMA or who otherwise fall within the categories or exceptions made under Sections 21 and 238. All or most of the protections provided by the UK regulatory system do not apply to investment in the HUT and compensation under the Financial Services Compensation Scheme will not be available. Potential investors should be aware that past performance is not a guide to the future. The price of units and the income from them may fluctuate upwards or downwards and cannot be guaranteed. Property based pooled vehicles such as property unit trusts, invest in real property, the value of which is generally a matter of a valuer's opinion. It may be difficult to deal in the units or to sell them at a reasonable price because the underlying property may not be readily saleable. There is no recognised market for units in HUT and, as a result, reliable information about the value of units in HUT or the extent of the risks to which they are exposed may not be readily available.

This press release is not intended as an offer or solicitation for the purchase or sale of any Financial Instrument. The material is not intended to provide, and should not be relied on for accounting, legal or tax advice, or investment recommendations.

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