Padlock Partners UK Fund I Completes Acquisition of Initial Properties

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TORONTO, Aug. 21, 2020 /CNW/ - Padlock Partners UK Fund I (the "Trust") announced today that it has successfully completed the acquisition of two self-storage properties located in the United Kingdom for an aggregate purchase price of approximately £7,200,000 (including closing costs), which was satisfied by way of cash from the proceeds of the Trust's initial public offering (the "Offering"). The Trust also announced today that is has acquired a leasehold interest in a development property located in the United Kingdom in exchange for a rent deposit of £75,000, which was satisfied by way of cash from the proceeds of the Offering.

The Trust indirectly acquired a freehold interest in a self-storage property located in Leighton Buzzard, United Kingdom, a municipality located approximately 23 miles northwest of London, United Kingdom (the "Leighton Buzzard Property"). The Leighton Buzzard Property is an established and successful self-storage property built in 2007. The Leighton Buzzard Property provides 17,660 square feet of rentable storage unit space with a maximum lettable area of 28,458 square feet. The Leighton Buzzard Property has excellent visibility and is located on the main thoroughfare through Leighton Buzzard on a 1.24 acre site. The property will be managed by Cinch Self Storage, a leading, third party, self storage, property manager in the United Kingdom.

The Trust also indirectly acquired a leasehold interest in a self-storage property located in Letchworth, United Kingdom, a municipality located approximately 22 miles north of London, United Kingdom (the "Letchworth Property"). The Letchworth Property is an established and successful self-storage property converted in 2007. The lease on the Letchworth Property has 926 years remaining at an annual rent of £66. The Letchworth Property provides 18,938 square feet of rentable storage unit space with a maximum lettable area of 37,895 square feet over three floors. The Property has excellent visibility, high traffic counts and is located to the east of the town center. The property will be managed by Cinch Self Storage, a leading, third party, self storage, property manager in the United Kingdom.

The Trust also indirectly acquired a leasehold interest in a development property located on Garratt Lane in Southwest London, United Kingdom (the "Wimbledon Property"). The Wimbledon Property is adjacent to the newly constructed Wimbledon Football Stadium. The lease on the Wimbledon Property is for a period of two years and comes with a purchase option in favour of the Trust which may be exercised at any time during the two-year lease term at a price of £3,400,000 in year one and £3,500,000 in year two (the "Purchase Option"). The Trust intends to demolish the Wimbledon Property and intends to build a four-storey purpose-built self-storage facility and has submitted such plans and a pre-filing application to the Wandsworth Borough Council in respect of such redevelopment plans. Upon approval of such redevelopment plans, the Trust expects to exercise the Purchase Option using cash from the proceeds of the Offering.

The balance of the net proceeds of the Offering will be used to subsequently acquire one or more additional properties in the United Kingdom, consistent with the Trust's investment objectives to, among other things, provide unitholders with an opportunity to invest in a portfolio of diversified income-producing commercial real estate properties in the United Kingdom, with a particular focus on self-storage and mixed-use properties, for capital expenditures and for working capital purposes.

About Padlock Partners UK Fund I

The Trust is an unincorporated investment trust and was established for the primary purpose of investing in a diversified portfolio of income producing commercial real estate properties in the United Kingdom with a focus on self-storage and mixed-use properties.

Forward-looking Statements

This news release contains statements that include forward-looking information within the meaning of Canadian securities laws. These forward-looking statements reflect the current expectations of the Trust regarding future events, including statements concerning the Trust's redevelopment plans for the Wimbledon Property, the Trust's expectations regarding exercise of the Purchase Option and the use of proceeds of the Offering to acquire one or more additional properties. In some cases, forward-looking statements can be identified by terms such as "may", "might", "will", "could", "should", "would", "occur", "expect", "plan", "anticipate", "believe", "intend", "seek", "aim", "estimate", "target", "project", "predict", "forecast", "potential", "continue", "likely", "schedule", or the negative thereof or other similar expressions concerning matters that are not historical facts.

Material factors and assumptions used by management of the Trust to develop the forward-looking information include, but are not limited to, the Trust's current expectations about: the availability of properties for acquisition and the price at which such properties may be acquired; the availability of mortgage financing; the capital structure of the Trust; the global and United Kingdom economic environment; foreign currency exchange rates; and governmental regulations or tax laws. While management considers these assumptions to be reasonable based on currently available information, they may prove to be incorrect.

Although management believes the expectations reflected in such forward-looking statements are reasonable and represent the Trust's internal projections, expectations and beliefs at this time, such statements involve known and unknown risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities may not be achieved. A variety of factors, many of which are beyond the Trust's control, could cause actual results in future periods to differ materially from current expectations of estimated or anticipated events or results expressed or implied by such forward-looking statements. Such factors include the risks identified in the final prospectus of the Trust dated August 13, 2020, including under the heading "Risk Factors" therein, as well as, among other things, risks related to the Trust's ability to obtain necessary approvals to redevelop the Wimbledon Property, the availability of suitable properties for purchase by the Trust, the availability of mortgage financing for such properties, and general economic and market factors, including interest rates, prospective purchasers of real estate, business competition, changes in government regulations or income tax laws. Readers are cautioned against placing undue reliance on forward-looking statements. Except as required by applicable Canadian securities laws, the Trust undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.

SOURCE Padlock Partners UK Fund I

John Stevenson, Chief Executive Officer, Padlock Partners UK Fund I, 480-309-6184, [email protected]; Matthew Collins, Chief Financial Officer, Padlock Partners UK Fund I, 480-428-0152, [email protected]