Annual Report

and Accounts 2023

NewRiver REIT plc Annual Report and Accounts 2023

2023 Financial Highlights

NewRiver is a leading Real Estate Investment Trust

specialising in buying, managing and developing

resilient retail assets across the UK that provide

essential goods and services whilst supporting

thedevelopment of thriving communities.

NewRiver has a Premium Listing on the Main Market

of the London Stock Exchange (ticker: NRR).

Contents

Financial Statements

Independent Auditors’ Report 141

Consolidated Statement of

Comprehensive Income

149

Consolidated Balance Sheet 150

Consolidated Cash Flow Statement 151

Consolidated Statement of Changes

in Equity

152

Notes to the Financial Statements 153

Company Balance Sheet 180

Statement of Changes in Equity 181

Notes to the Financial Statements 182

Alternative Performance Measures 187

EPRA Performance Measures 188

Glossary 194

Company information 196

Governance

The Chair’s letter on governance 97

Our leadership team 98

Board leadership and

Company purpose

101

Nomination Committee Report 109

Audit Committee Report 113

Remuneration Report 119

Directors’ Report 137

Statement of Directors’ responsibilities 140

Retail Underlying Funds

From Operations (UFFO)

Ordinary Dividend

Per Share

Total

Accounting Return

Retail UFFO

Per Share

Portfolio Valuation

Performance

Key

Performance versus previous year

IFRS

Loss After Tax

Loan To Value

£25.8m

6.7p

-4.6%

8.3p

-5.9%

£(16.8)m

33.9%

FY22: £20.5m

FY21: £19.5m

FY22: 7.4p

FY21: 3.0p

FY22: -6.6%

FY21: -24.9%

FY22: 6.7p

FY21: 6.4p

FY22: -0.9%

FY21: -13.6%

FY22: £(26.6)m

FY21: £(150.5)m

FY22: 34.1%

FY21: 50.6%

Net debt

£201.3m

FY22: £221.5m

FY21: £493.3m

Improved

Declined

Maintained

Strategic Report

Chair’s statement 2

Overview 4

Our business 6

Chief Executive’s review 8

Our marketplace 12

Our business model 18

Stakeholder engagement 20

Key performance indicators 28

Portfolio review 32

Our platform 42

Finance review 46

Our ESG approach 54

Principal risks and uncertainties 88

Viability statement 95

1. Retail UFFO is UFFO from continuing operations and excludes contribution from Hawthorn

in FY22 prior to its disposal on 20 August 2021, see Note 12 to the Financial Statements

RESILIENTRESILIENT

RETAILRETAIL

ROBUST

MARKET DYNAMICS

Our portfolio positioning, focused on essential

goods and services, where a physical store is vital

to our occupiers, is the reason for the underlying

resilience of our operating performance.

See page 12

AGILE

PLATFORM

Our market leading asset management platform draws

on the in-house expertise of our team, our deep market

knowledge and excellent occupier relationships to

enhance and protect income streams for our assets

both on our own balance sheet and those we manage

on behalf of our capital partners.

See page 42

STRONG

FINANCIAL POSITION

Our balance sheet is fully unsecured and well

positioned to support our future growth with

significant cash holdings, no debt maturity until

2028 and no exposure to interest on drawn debt.

See page 46

FOCUSED

PORTFOLIO

Our resilient portfolio provides affordable,

well-located and omnichannel compatible space

for successful and expanding occupiers reliant on

a physical store network.

See page 6

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our vision for resilient retail

Chair’s statement

The last year has seen another strong operational

performance from NewRiver, in sharp contrast to

sentiment towards real estate in the equity capital

markets. However, our share price has held its own,

largely due to shareholders’ belief in the Company’s

ability to deliver superior operational performance

which is underpinned by the affordability and

sustainability of our rental cashflows.

We appreciate the support of our shareholders and

are pleased to report a dividend of 6.7 pence per share

this year, fully covered by Underlying Funds

From Operations.

The Board continues to believe that focusing on the fundamentals

of the business is the best way to deliver not only attractive income

returns to shareholders through the dividend, but also the capacity

to deliver capital returns in due course, which we believe will unlock

our target to deliver a sustainable Total Accounting Return of 10% in

the medium term. By fundamentals, we mean delivering the kind of

focused operational performance set out so clearly in the Chief

Executive’s Review. We mean maintaining sensible and appropriate

levels of debt and we mean being highly disciplined about how and

where we deploy precious capital.

We have worked hard over the last couple of years to build a

verystrong balance sheet. The sale of our pub business almost two

yearsago provided the opportunity to significantly reduce our levels

of debt. This year, the continuing sale of those retail assets that are

not part of our resilient retail strategy has reduced our net debt

further and enhanced our cash position. In an otherwise difficult

market, wehave also continued to dispose of assets that were

deemed tobe in Work Out. The Board has been particularly

pleasedwith progress here as these assets absorbed a significant

amount of management time and were regarded as being non-core

to our portfolio. As we get to the end of this particular exercise,

ourfocusnow is on recycling that capital.

So we look forward with confidence to our portfolio containing only

those assets which we believe display the characteristics of resilient

retail. By which we mean they are well located, in economically

attractive neighbourhoods, and contain the appropriate mix of local

retail and other uses that will continue to attract shoppers to return

again and again.

“I would like to thank my

colleagues on the Board

fortheir diligence, support

andchallenge. We have an

exceptional team at NewRiver

who are always focused on

delivering the best returns

for shareholders.”

Baroness Ford OBE

Non-Executive Chair

Strategic Report

OUR PURPOSE

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

To own, manage and

develop resilient retail

assets across the UK that

provide essential goods

and services and support

the development of

thriving communities.

Resilient performance

and strategic progress

highlights

• Resilient operational performance

• Strong financialposition

• Expanded Capital Partnerships

• Disposal target delivered;

Work Out exiton track

• Portfolio valuation outperformance

• Progress on ESG objectives

Town centres have never been in more need of regeneration and we

believe we are well equipped to provide solutions. We know how to

manage retail assets well, we understand how to turn around assets

that are struggling, and we know how to reshape and revitalise old

centres that require a new approach to make them fit for purpose in

the future. Fundamentally we believe that physical retail, well located,

well designed and set within attractive, mixed use centres, has a

vibrant future. Our own experience over the last few years has

demonstrated beyond doubt that not all retail landlords are the same;

this year has delivered our highest occupancy rate for five years and

critically, seen our rent collection return to pre-Covid levels.

As we continue to develop our model, we have also been delighted

to offer our asset and property management services to others,

through our Capital Partnerships. We believe that our team is best

inclass and this has been endorsed during the year by a significant

new mandate from M&G Real Estate, which means we now have

public sector, private equity and institutional partnerships. We believe

that we have an opportunity to deliver further earnings growth from

Capital Partnerships and look forward to developing this important

area of our business.

I would like to thank my colleagues on the Board for their diligence,

support and challenge. We have an exceptional team at NewRiver

who are always focused on delivering the best returns for

shareholders. It is a matter of pride that in doing so, we have

continued to improve our ESG performance, recognised by an

increase in our GRESB score during the year, and also created

agreat environment for our team to thrive and grow. This was

recognised very recently by The Sunday Times, when it named

NewRiver as one of the best places to work in the UK in its

prestigious Best Places to Work 2023 list, after we entered

forthefirst time this year.

It is my privilege to work with such a talented and committed team

and as always, we are very grateful to our shareholders for your

thoughtful and patient support.

Baroness Ford OBE

Non-Executive Chair

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Overview

Delivering our

resilient retailstrategy

Strategic Report

Our purpose

To own, manage and develop resilient retail assets across the UK that

provide essential goods and services and support the development of

thriving communities.

See page 3

shapes our business model

• Disciplined capital allocation

• Leveraging our platform

• Flexible balance sheet

• Integrated ESG programme

See page 18

which in turn drives our growth strategy

Our strategy aims to deliver a consistent 10% Total Accounting Return in the

medium term by focusing exclusively on these activities

See page 11

delivered within our risk management framework

Underpinned by effective risk management

See page 88

• Focused on a resilient sub-sector of the retail market

• Providing essential goods and services to communities

• Store-based network for omnichannel retail

• Well-positioned to withstand macroeconomic headwinds

See page 12

• Retail Parks

• Core Shopping Centres

• Work Out

• Regeneration

See page 32

• Market leading asset management team

• Scalable operational structure

• Data-driven approach

• Strong occupier relationships

• Expanding Capital Partnerships

See page 42

• Unsecured balance sheet structure

• No debt maturity until 2028

• Significant cash holdings

• Debt costs fixed until 2028

See page 46

MARKET

PORTFOLIO

PLATFORM

FINANCIAL

POSITION

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

We have a resilient investment case to deliver reliable and recurring revenues

See page 20

We oversee and manage

our purpose, culture, values,

strategy, sustainability and

relationships through

effective Board leadership

and governance

Enabling us to generate

long-term value for

our stakeholders:

• Our team

• Our communities

• Our shareholders

• Our capital partners

• Our occupiers

• Our environment

See page 96

28%

11%

23%

37%

Retail Parks

Shopping Centres

– Core

Shopping Centres

– Regeneration

Shopping Centres

– Work Out

Other

Our resilient retail portfolio, focused on providing essential

goods and services to local communities, hasonce again

delivered a strong operational performance reflecting

the active occupational demandfor space at our assets

and demonstrating theunderlying resilience within our

portfolioand our platform.

Resilient retail at a glance

Portfolio segmentation

1. Retail Parks

2. Core Shopping Centres

3. Regeneration Shopping Centres

Focused on three resilient sectors

Top 10 retailers

% rent stores

3.4% 20

3.1% 10

2.4% 14

2.3% 4

2.2% 14

2.1% 13

2.1% 5

2.0% 6

1.6% 3

10.

1.4% 11

total 22.6%

FY21 FY22 FY23

95.6%

95.8%

96.7%

High occupancy

FY21 FY22 FY23

90%

87%

92%

High retention rate

Progress this year

96%

92%

98%

FY21 FY22 FY23

98% 97% 92%

Robust rent collection

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic ReportStrategic report

Our business

Strategic Report

Resilient retail: 10 key characteristics

CAGR: percentage per annum growth of new rent vs

previous passing rent, over period of previous lease length

Leasing Pricing: long term rent secured in leasing

activity vs valuer ERV

-0.4%

-0.3%

-0.5%

FY21 FY22 FY23

Compound Annual Growth Rate

(CAGR) vs previous rent

FY21 FY22 FY23

+7.4%

+0.6%

+1.1%

Strong leasing pricing vs ERV

FY21 FY22 FY23

£11.74

£11.51

£11.98

Location Online compatible

Strong demographic profile

• Our centres are located close to some of the fastest

growing communities in the UK

Fulfils role in omnichannel supply chains

• Our retail parks are optimised for click & collect with both

free parking and delivery & returns pods in car parks

Optionality Asset management

Underlying alternative use

• Our assets present optionality to re-purpose surplus retail space

or land predominantly for residential

Low-intensity, low-risk asset management

• Our market leading platform has a targeted capex

programme to increase rental income, capital growth

and shopper experience

Retail supply ESG

Favourable retail demand vs supply balance

• Good demand from retailers for our assets, which are

in the heart of communities and cater for increased

localism and working from home dynamics

• We have low occupational costs with an affordable

average rent of £11.98 per sq ft

Contributes to ESG commitments

• We can decarbonise our assets at a lower future cost

• 100% renewable electricity across our managed retail assets

• Our assets are easily accessible with low travel times, including

26% of shoppers travelling by foot which is conducive to a

low-carbon footprint

Convenience Working from home

Easy access, customer-friendly

• Average travel time of only 13 minutes to our

community shopping centres

• Our retail parks have large, accessible free car

parking and are well served by public transport

Rise of localism

• Our local assets in the heart of communities benefit from the

increased spend redirected from cities to more suburban and

neighbourhood locations following the shift to hybrid working

Occupiers Liquidity

Occupier mix aligned with demand

• Our diversified occupier line-up is focused on essential

goods and services

Low capital value and wide buyer pool

• Liquid average lot size of £15.9 million

-0.5%+1.1%£11.98

psqf

Affordable average rent

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Resilient performance

andstrategic progress

“We are confident of

ourabilityto deliver our

mediumterm objective of

aconsistentpremium total

accounting return.”

Allan Lockhart

Chief Executive

Our strong operational performance, including disposals within our

Work Out portfolio, resulted in excellent cash generation as we ended

the financial year with £111.3 million of cash up from £88.2 million at the

end of FY22.

Whilst the MSCI All Property and All Retail indices experienced capital

returns of -16% and -13% respectively for the year 1 April 2022 to

31 March 2023, our portfolio outperformed with a like-for-like valuation

movement of -5.9%. The majority of our reported decline was

contained within our Regeneration portfolio, predominantly driven

byhigher estimated development costs, a direct consequence of

persistent high inflation. As a result, our EPRA Net Tangible Assets

(NTA) per share at the full year was 121 pence (FY22: 134 pence).

At our FY22 results, we said that we would seek to maintain

headroomto our Loan To Value (LTV) guidance of <40% given the

macro-economic uncertainty at that time. That was the right decision

given the significant disruption in the real estate capital markets

especially in the final quarter of 2022. Our LTV at the full year was

33.9% (FY22: 34.1%), well within our guidance. Importantly, we have

norefinancing or exposure to higher interest rates on drawn debt until

2028 and we view this, together with the significant spread between

our portfolio net initial yield of 8.0% and our cost of borrowing of 3.5%,

as key strengths.

A key highlight of the full year was successfully expanding our Capital

Partnerships strategy by securing a high-quality mandate from M&G

Real Estate to asset manage a large retail portfolio comprising 16 retail

parks and one shopping centre, further extended to include a second

shopping centre post year end. This is a great endorsement of the

quality of our asset management platform and also demonstrates the

potential to grow our recurring earnings in a capital light way.

Our operating and financial results demonstrate the underlying resilience

of our business in what has been a challenging year for the real estate

sector. That, together with our strong financial position and the strategic

options available to us, means we remain confident in delivering our

objective of a consistent 10% total accounting return for our shareholders.

FINANCIALS

Strong Financial Performance

& FullyCoveredDividend

Our Retail UFFO increased by 26% in FY23 to £25.8 million

(FY22: £20.5 million). This performance has been driven by an increase

inour Net Property Income, up 5.0%, adjusted for disposals, but also

included the collection of Covid related rent arrears from FY21 and

FY22, a reduction in Administration and Finance Expenses and the

settlement of our insurance claim for loss of income in our car parks

asa result of the Covid-19 lockdowns of £1.4 million.

In line with our dividend policy, we have declared a final dividend of 3.2

pence per share bringing the total dividend for FY23 to 6.7 pence per

share, which is 125% covered by UFFO.

As a result of an improving Retail UFFO, a tight control on capital

expenditure and completed Work Out disposals, our cash position

increased from £88.2 million in March 2022 to £111.3 million in March

2023. One of the benefits of rising interest rates, is that we are now

receiving a return on our excess cash which is accretive to our UFFO.

Valuation Outperformance

Our portfolio valuation has been far more insulated from the impact of

rising interest rates compared to the wider real estate sector, partly due

to ouralready high portfolio yield, and recorded a like-for-like valuation

movement of -5.9%. The overall movement was focused on our

Regeneration portfolio, accounting for 62% of the decline, a direct

impact of elevated inflation on estimated construction and finance costs.

We ended our financial year in a strong position having delivered a

resilient set of operating and financial results, continuing to execute

ourstrategy notwithstanding wider macro-economic headwinds.

Active demand for space in our portfolio has been maintained,

reflecting that the physical retail store is at the centre of retailers

omnichannel strategies, supported by a broadly resilient consumer.

This is reflected in another good year of leasing performance both

interms of volume and pricing, leading to our highest occupancy rate

for five years at 97% (FY22: 96%). It is through the positioning of our

portfolio and the quality of our asset management platform that our

Retail Underlying Funds From Operations (UFFO) increased 26% to

£25.8 million from £20.5 million in the prior year and that is despite

theimpact of loss of income from prior year disposals and limited

capital deployment of only £4.0 million.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Chief Executive’s review

Pleasingly, our Core Shopping Centre portfolio, representing 37%

ofour total portfolio, proved to be broadly stable with a -0.7% capital

return for FY23. Once again, we have significantly outperformed the

market as evidenced by MSCI which for shopping centres delivered

a-10.8% capital return over the last twelve months.

Our Retail Park portfolio, representing 28% of our total portfolio,

recorded a capital return of -3.2% entirely due to yield expansion

offset by ERV growth of 2.7%. Like our Core Shopping Centres, our

Retail Parks outperformed MSCI retail parks which recorded a capital

return of -12.1% over the same period.

The like-for-like valuation movement within our Work Out portfolio,

which accounts for 11% of our total portfolio, was -7.8%, outperforming

the MSCI Shopping Centre Index. We are on track to have completed

our exit from our Work Out portfolio by the end of FY24, having

completed two disposals in FY23.

Given that our portfolio consistently delivers a higher income return

and a superior capital return than the MSCI All Retail Index, on a total

return basis our portfolio has once again significantly outperformed

the index in FY23, by 1,020bps, as it has done over the last five years.

Our Balance Sheet is in great shape with an LTV of 33.9% at the year

end, in line with the prior year. Equally important is Balance Sheet

gearing which for us is less than 50%, Net debt to EBITDA is only

4.9x, one of the lowest in the real estate sector, and interest cover

has increased to 4.3x, one of the highest in the real estate sector.

These strong financial metrics and the fact that we have no

refinancing requirements nor exposure to higher interest rates

until2028 place us in an excellent position to capitalise on

futuregrowth opportunities at the appropriate time.

PORTFOLIO

Resilient Operational Performance

Operationally, we had a good performance in terms of leasing

volume and pricing. That, together with our high retention rate when

it comes to lease expiry or lease break, has resulted in an increase in

our occupancy to 97% (FY22: 96%). Rent collection and car park and

commercialisation cashflows all improved during the year, with rent

collection now back to pre-Covid-19 collection rates.

In total we completed 979,200 sq ft of leasing transactions during

theyear, securing £7.9 million of annualised income. Our long-term

leasing transactions which represented 69% of the total rent secured

were transacted at rents 1.1% above valuer ERVs. Furthermore,

77%ofthe annualised long-term rent secured was in our Core

Shopping Centre and Retail Park portfolios, at levels exceeding

valuer ERVs by 2.3% and 0.8% respectively.

Whilst rent secured within our Regeneration Portfolio was down

-3.9%versus valuer ERV, it was +9.0% ahead of the previous passing

rent and therefore accretive to rental cashflows. It is also reflective of

our ongoing strategy to ensure greater lease flexibility to support our

vacant possession strategy. The Work Out portfolio leasing activity

was on terms -2.1% versus valuer ERV, however, this only represents

a small proportion of the total portfolio long-term rent secured.

For total portfolio leasing events in FY23, the rents achieved had a

Compound Annual Growth Rate (CAGR) versus the previous passing

rent of only -0.5% over the average previous lease period of 10.3

years. Over the past three years, which totals £15.4m of annualised

rent, this is only -0.4% based on an average previous lease period

of10.0 years. Taking into account the significant disruption the retail

sector has faced over the last 10 years from the growth of online

retailing and Covid-19, this clearly demonstrates the underlying

resilience in our rental cashflows.

OUR HIGHLIGHTS

Occupancy

96.7%

FY22: 95.6%

Rent collection

98%

FY22: 96%

Leasing vs ERV

+1.1.%

FY22: +7.4%

GRESB score

FY22: 68

Completed

disposals

£23m

FY22: £305m

Valuation

performance

-5.9%

FY22: -0.9%

Retail Underlying

Funds From Operations

£25.8m

FY22: £20.5m

Retail UFFO

per share

8.3p

FY22: 6.7p

LTV

33.9%

FY22: 34.1%

Net debt

£201.3m

FY22: £221.5m

Total Accounting

Return

-4.6%

FY22: -6.6%

Ordinary Dividend

per share

6.7p

FY22: 7.4p

* As at time of reporting FY22 results

Key

Performance versus previous year

Improved Declined Maintained

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Overall, our long-term leasing transactions had a weighted average

lease expiry (WALE) of 8.2 years, up from 6.4 years in FY22, with

Retail Parks at 12.0 years and Core Shopping Centres at 6.9 years.

Interms of occupier incentives, we have seen a marked improvement

in rent-free periods granted in the period compared to FY21 and

FY20. For long-term leasing transactions, the average rent-free

period was just 2.8 months with many occupiers receiving no

rent-free period.

The demand for space that we saw in our portfolio during the year

remained broadly based with 67% of the space leased to Grocery,

Discount, F&B, Health & Beauty and Value Fashion.

Well Positioned Portfolio

As at 31 March 2023, Retail Parks accounted for 28% of our portfolio,

totalling 14 assets. It has been another positive year for our Retail Park

Portfolio which at year end was 98% occupied with a retention rate

of100%. We have continued to see strong occupational and investor

demand for our Retail Parks which are predominately located adjacent

to major supermarkets, benefit from free surface car parking and are

supportive of retailers’ omnichannel strategies. As such we had a good

year of leasing with transactions completed 0.8% ahead of valuer ERV.

Over the last three financial years, we have completed long-term

leasing transactions totalling £4.5 million of annualised rent across our

Retail Parks which versus the previous passing rent equates to a CAGR

of +0.6% per annum over the average previous lease period of 12.3

years. Our Retail Parks delivered a total return of 4.8%, outperforming

the MSCI retail warehouse index by +1,170 basis points, which recorded

a -6.8% total return.

As at 31 March 2023, our Core Shopping Centre portfolio represented

37% of our total portfolio value and comprises 14 Core Shopping Centres

at the heart of local communities providing a range of essential goods

and services with an occupancy of 98% and retention rate of 90%.

Theconsistent occupational demand is reflected in the positive

leasingperformance during the year with long-term deals transacted

2.3% ahead of valuer ERV, underpinned by an average affordable

rentofjust£13.18 per square foot and £39,000 per annum. Over the last

threefinancial years, we have completed long-term leasing transactions

totalling £5.5 million of annualised rent, which compared to the previous

passing rent, equates to a CAGR of only -0.8% per annum over the

average previous lease period of 9.9 years. Our Core Shopping Centres

delivered a total return of 10.3%, outperforming the MSCI shopping

centres index by +1,540 basis points, which recorded a -5.1% total return.

We have three Regeneration assets, representing 23% of the

totalportfolio value, for which we have planning consent for:

187residential units, over 850 residential units at the pre-planning

application stage and a further 350 residential units in the masterplan

stage for phase one. None of these projects will be built-out by

NewRiver as our intention is to deliver value either through sale or

bypartnering with residential developers, once planning consents

are secured. Currently, we are not exposed to material contractual

capital expenditure commitments but in order to maximise value,

some modest capital expenditure will be required over the next

twoyears. Whilst we advance our regeneration proposals, we have

maintained a high occupancy at 97% whilst at the same time building

flexibility into the leases to deliver future vacant possession. As such

the leasing deals completed within our Regeneration portfolio were

transacted at a modest -3.9% below valuer ERVs.

Our Work Out portfolio represents 11% of our portfolio and comprises

nine assets which we intend to dispose of or complete turnaround

strategies on. Since our Half Year results, we have completed the

disposals of two shopping centres in Wakefield and Darlington, with

theremaining sales to be completed in FY24; those assets subject to a

turnaround strategy are supported by further investment by the end of

FY24. In the interim, occupancy and retention rates for our Work Out

assets remain high at 93% and 89% respectively and leasing deals

completed during the year were transacted at -2.1% below valuer ERV.

In respect of capital and total returns, our Work Out portfolio has

outperformed the MSCI shopping centres index by +10 and +590

basispoints respectively.

PLATFORM

Growing Capital Partnerships

Capital Partnerships are an important component of our strategy to

deliver earnings growth in a capital light way. We were delighted in

November 2022 to secure a high-profile mandate from M&G Real

Estate to manage a large retail portfolio comprising 16 retail parks

anda shopping centre located in the South East of England. After our

appointment in November 2022, the mandate was extended to include

a further shopping centre in the South East post year end in April 2023.

Currently, we have three key Capital Partnerships: in the public sector

with Canterbury City Council; in the private equity sector with BRAVO;

and now in the institutional sector with M&G Real Estate. Currently,

we asset manage 19 retail parks and five shopping centres with a

total value in excess of £500 million and annualised rent of over

£50 million.

The expansion and breadth of our Capital Partnerships is a clear

recognition of the need for a best-in-class platform to extract

performance in the highly operational retail sector. We believe that

we have a significant opportunity to deliver further earnings growth

through our Capital Partnership activities.

Prudent Capital Allocation

Capital allocation during the year has been focused on investing

inour portfolio with tightly controlled discipline given the macro-

economic uncertainty. Total investment in FY23 was £4.0 million of

which 57% was allocated to our retail park portfolio, with the largest

project being the construction of a new Aldi store in Dewsbury which

accounted for 23% of our total portfolio investment.

We invested £0.6 million in our Core Shopping Centres, the key

project being the funding of our planning application for a new

foodstore in Market Deeping which was unanimously approved

bythe Council post year end. Our Regeneration portfolio received

£0.7 million of investment principally to advance our forthcoming

planning application in Grays for an 850+ unit residential-led major

town centre regeneration.

Committed progress to ESG

We take our role as the custodians of assets within the community

very seriously and part of that responsibility is helping to protect

thelong-term sustainability of the environment that they sit within,

and we are pleased to report great progress in the delivery of our

committed ESG Strategy.

During the year, the quality of the Management and Governance of

our business was recognised as we ranked first place in the GRESB

“Management” module out of a total 901 participants across Europe.

This recognition is due to the fastidious work from our team in

embedding our ESG objectives across the business at both the

corporate and asset level including developing a supplier ESG

performance evaluation process and formalising a quarterly ESG

performance review process for our Property team.

Our ESG activities this year have resulted in achieving our target

GRESB score of 70/100 for the “Standing Portfolio” Benchmark, scoring

90/100 for the GRESB “Development” benchmark and being awarded

an “A” alignment in GRESB’s independent TCFD assessment.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Chief Executive’s Review continued

We also retained our ‘B’ Rating from CDP for our management of

climate-related issues as well as retaining our Gold Award in EPRA

Sustainability Best Practice Recommendations Awards, recognising

the excellence in the transparency and comparability of our

environmental, social and governance disclosures.

Our assets are typically easily accessible with short travel times,

supporting the wider climate and well-being agenda. We set our

pathway to Net Zero in 2019 and we continue to make great inroads

in implementing this. Achieving net-zero within the retail sector relies

upon mutual action by real estate owners and occupiers. The energy

consumed by our occupiers in our assets accounts for almost 90% of

our total carbon emissions. These are emissions over which we have

limited control, but we continue to develop our engagement activities

to support alignment between our climate ambitions and those of our

occupiers and so we are pleased to report that 57% of our lettable

floorspace is occupied by retailers that have already set emissions

reduction targets, with approximately 70% of that 57% part of the BRC

Climate Commitment to reduce carbon emissions to net zero by 2040.

As we reported last year, all of the energy supplied into our common

areas (malls and car parks) is already carbon neutral but this year we

also generated over 250,000 kWh of renewable electricity on-site at

our assets, maintained our “zero waste to landfill” policy and

delivered or secured contracts for EV charging infrastructure at

88%of our surface-level car parks. Given cost inflation headwinds,

itis also notable that the energy supplied into our malls is hedged

until Spring 2024, so we are not facing into price increases.

Finally, during the year we relocated our Head Office to a

BREEAMExcellent, Net-Zero building in London. We are committed

to continuing this great work and playing our part in helping protect

ourplanet and stakeholders for the long-term. .

MARKET

Outlook

Despite ongoing geopolitical tensions, elevated inflation and higher

interest rates, we are reassured with the improving occupational

demand for space in our resiliently positioned portfolio. Given our

current high occupancy rates for Retail Parks and Core Shopping

Centres at 98% and the benefit of the reduction of business rates for

our occupiers, we believe that the prospects for future rental growth

are now encouraging which should be supportive of future valuations.

For some time now, we have consistently expressed our confidence

in our portfolio positioning which is predominately focused on

essential goods and services. Our operating and financial results over

the last two years demonstrate the underlying resilience that we have

in our portfolio and in our platform, and we expect that to continue

into our new financial year.

We are in an excellent position with a strong balance sheet that is

notexposed in the medium term to rising interest rates, we have

capital available to deploy and opportunities to expand our Capital

Partnerships. We are therefore confident of our ability to deliver our

medium term objective of a consistent 10% total accounting return.

Allan Lockhart

Chief Executive Officer

14 June 2023

OUR STRATEGY

We do this by delivering on our

business model:

This strategy is underpinned by clear

pillars ofexecution:

• Highly collaborative working relationships with all key partners

• A clear plan to help create thriving communities in the towns

where we are invested

• A committed sustainability strategy to minimise our impact on

the environment

• Creating opportunities for our team to develop their careers

• Operational efficiency and excellence

• Maintaining a strong balance sheet

• Delivering consistent and attractive risk-adjusted returns

Our strategy aims to deliver a reliable

and recurring income led 10% Total

Accounting Return and create value

for our stakeholders:

Local

Authorities

Shareholders

Environment

Occupiers

Capital

Partners

Team

Lenders

Communities

1. Disciplined

capital allocation

3. Flexible

balance sheet

2. Leveraging

our platform

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

ROBUST

MARKET

The UK economy and retail real estate

markethas never before endured such

volatileconditions including international

health pandemics and war as well as

politicaland fiscal instability. This has

ledtocost inflation, rising interest rates

andincreased caution amongst both

investorsand consumers.

Yet contrary to perception and media

narrative, the consumer has remained

resilientand those retail occupiers with an

omnichannel offer, reliant on the physical

storeand focused on providing essential

goods and services, have continued to

perform well.

This is the robust sub-sector of the market

thatwe specialise in, meaning our resilient

retail real estate portfolio is well-positioned

forgrowth.

RESILIENT RETAIL

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic report

Our marketplace

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Consumers

Rising Housing Costs

The housing market has shown resilience in 2023 as mortgage

rates eased and the labour market remained tight in part

reversing the negative sentiment following the jump in the Bank

of England interest rates as a result of the somewhat calamitous

September mini-budget. House prices are stabilising and the

average house price is still 20% higher compared with March

2020 (Halifax). Borrowers are choosing longer mortgage terms

to satisfy affordability requirements whilst many potential first

time buyers are delaying their plans and resorting to the rental

market, putting further pressure on rental costs already impacted

by a significant demand supply imbalance (UK Finance).

High But Easing Inflation

UK inflation appears to have peaked at 11.1% in the 12 months to

October 2022, falling more slowly than anticipated over the

subsequent months to 8.7% in April as rates across transport

and clothing declined but offset by persistent food price

inflation. It is expected further easing in commodity and goods

prices will result in a continued downward trend in inflation later

in the year, with perhaps the key risk in respect of ongoing

inflation in 2023 being the impact of higher wage costs. Whilst

annual wage growth as at March 2023 stands at 5.8%, in real

terms it is -3.0%, the largest real total decline since April 2009

(ONS) albeit the negative differential is widely expected to

narrow through 2023 and reverse by the end of 2024 (Shore

Capital).

Consumers Still Spending

Early 2023 has followed a stronger than forecast Christmas 2022,

with sales values and volumes (excl. fuel) +2.4% and +1.0% inthe

three months to April 2023 compared with the previous

threemonths. April sales figures compared to pre-Covid levels

are+17.9% in value and +0.3% in volume, indicating consumers are

purchasing at similar levels to pre-pandemic. Despite the

narrative around the consumer squeeze and wide-scale

belt-tightening, this is not yet reflected in the data and consumers

are still sitting on excess savings built up during the pandemic.

Changing Purchasing Behaviour

Due to cost of living pressures, patterns of spending have shifted

awayfrom luxuries towards essential and cheaper alternatives.

Barclays data shows that 34% of consumers are buying “dupes”,

affordable versions of expensive products, especially in food and

drink products with 68% of consumers opting for the cheaper options.

There is an evident pattern of down trading in the grocery sector,

discount stores continue to experience month on months sales

growth and in terms of eating out, there is shift in preference from

expensive restaurants to more value focused, deal driven options.

NewRiver’s response

• Despite the cost of living crisis, retail sales have remained

strong with the first half of 2022 benefiting from a buoyant

period of post-lockdown spending with positive sales figures

continuing into early 2023 following a strong Christmas

period. Positive consumer spending has led to strong

sentiment among retailers and is reflected within NewRiver’s

retention rate of 92% and increased occupancy of 97%.

• Consumers are evidently changing their purchasing behaviour,

down-trading across product categories as a reaction to

adjustments on their disposable income and will be awaiting

signs that mortgage rates, food and fuel inflation have peaked

prior to increasing their discretionary spend. NewRiver’s

occupier base has limited exposure to discretionary spend

with 78% by rent from within essential sub-sectors.

• The GfK consumer confidence index shows that whilst

confidence is low, it is improving significantly. Since March

2023, there has been a 13 point jump in positivity for

personal finance situations – such a large jump suggests

household finances are stronger than perceived and the

overall consumer confidence index is at its highest level

since March 2022 playing into spend across our portfolio.

• The increased cost of living and impact of rising mortgage

costs is not equal across the UK, with those living in cities

andwithin London and South East likely to be most

impactedwhere mortgages are higher and disposal

incomeas a percentage of gross income is lower.

NewRiver’sportfolio is located throughout the UK, 66%

outside the South East, in areas which on average have a

house price of £208,000, compared to the UK average of

£287,000 (Halifax). The NewRiver consumer is therefore

impacted to a lesser extent due to rising mortgage costs.

• As inflation eases throughout 2023, real disposable

incomeswill improve, confidence will continue to

recoveralongside record low unemployment levels of

only3.9% (asat March 2023), and there is the potential that

retail sales byvolume should continue to increase.

Retail Sales Values and Volumes

100

105

110

115

120

125

130

Retail Sales Index Feb-20 = 100

CPI (YoY%)

Value Volume CPI (RHS)

2020 Feb 2021 Sep 2023 Apr

Source: ONS

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Retailers

Strong Occupational Market

There is positive sentiment amongst retailers, with strong

reported sales results especially in-store performance and

renewed retailer expansion plans for 2023. This is reflected in

the overall shopping centre market leasing activity with Savills

reporting a deal count in 2022 exceeding the four year average

due to a flurry of activity and average net effective rents only

2.9% down compared to 2019. Rental tension within the Retail

Park market has remained in 2022 and looking forward, limited

availability of space should drive rental growth. The overall retail

park market vacancy rate stands at only 5% (Savills), comparable

to the MSCI Industrial vacancy rate of 6.3% whichhas seen 21%

ERV growth over the past two years.

Limited Retailer Distress

2022 was a quiet year for retailer distress with only 2,300 stores

impacted. This level is significantly below 2020, 2008 and the

average since 2007, with the majority of stores actually

remaining open. The only notable store based retailers being

McColl’s, Joules and M&Co who were subsequently purchased

by Morrisons, Next and AK Retail respectively. Going into 2023,

online pure-play operators are considered to be at the greatest

risk after enduring a difficult 2022 trading environment as

consumers returned to physical stores, margins were squeezed

and store-based and multi-channel retailers created a strong

online presence. Since March 2021 and the end of the last UK

lockdown, online sales values have decreased -16.0% and

pure-play -6.6% against overall retail sales value growth of

+15.7% during this period. The Knight Frank watchlist of the Top

300 UK Retailers rates 22 online-only retailers as major risk with

39 with no immediate risk. Physical retailers, whilst not immune

to the challenging trading conditions coming into 2023, have

emerged from the pandemic fitter, with the weaker outfits

having already exited the market.

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Stores impacted Average since 2007

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023 YTD

UK Retailer Failures Decline

-25%

-20%

-15%

-10%

-5%

10%

15%

vs 2019

Q1 2020

Q2 2020

Q3 2020

Q4 2020

Q1 2021

Q2 2021

Q3 2021

Q4 2021

Q1 2022

Q2 2022

Q3 2022

Q4 2022

YoY

Shopping Centre Rents since 2019

(net effective rents rolling 4-Qtr average)

Source: Savills Research

-20%

-15%

-11%

-7%

-2%

11%

16%

20%

25%

Net Effective Rent Growth YoY (LHS) Vacancy % sq ft (RHS)

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

Retail Parks Rents and Vacancy

(net effective rents)

Source: Savills Research Source: Centre for Retail Research

Online sales as % of total retail sales

Peak Online % sales

-25% from peak

-4% from peak

Apr 2020 Mar 2023 Jan 2021 Mar 2023

Non-food Food

45.8%

21.1%

12.1%

8.2%

Source: ONS

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our marketplace continued

Continued Rise of Omnichannel

Online is considered a channel of distribution rather than

category of retail and given the consumer desire for flexibility

topurchase goods when, where and how they want, omnichannel

retail with the converging of physical and online channels is

becoming ever more popular. 50% of overall sales involve online

interaction at some point (Barclays) but the physical storeis at

the centre of the retail journey due to the perception of in-store

bargains, absence of delivery and return charges, andthe ability

to use cash as a tangible budgeting tool. Click & collect

increases to be popular for both consumers and retailers and

this is set to continue into 2023.

Positive 2023 Rates Revaluation Outcome

The 2023 rates revaluation was a welcome outcome for retailers

andwill provide significant occupational cost savings at a time when

other operational costs have increased. On average, rateable values

within England and Wales declined 10% for retail properties with

savings ranging up to 20-50%. This compares incredibly favourable

to the 27% increase within Industrial and 10% in Offices. Downwards

transition relief is to be scrapped giving an immediate benefit to

retailers, it was previously phased over a number of years.

“The physical store

remains at the centre

of the retail journey”

16%

average reduction in

rateable values for

retailers across the

NewRiver portfolio

NewRiver’s response

• The strong retail occupational market is reflected in our leasing

statistics with 979,200 sq ft of new lettings and renewals agreed

in FY23 with long-term transactions on average +1.1% ahead of

ERV, 9.7% ahead of previous rent and with a Weighted Average

Lease Expiry of 8.2 years

• Our retail portfolio is deliberately focused on essential retailers

which serve the local community, and has minimal exposure to

the structurally challenged sub-sectors including department

stores and mid-market fashion. To assess the risk associated

with our tenant base and future cashflows, we have worked with

Income Analytics (part owned by MSCI and Savills) to quantify

the probability and impact of tenant failure. The tenant risk of

failure analysis projects a probability of failure in the next

24 months of only 0.9%.

• The resilience of NewRiver’s rental cashflows is underpinned

byaffordable rents and low occupational costs. Given the

downward pressure on retailer margins as a result of material

increases in retailer’s cost and revenue pressures which are set

to continue in the short to medium term, we have assessed the

continuing rental affordability over the next 3 years. As expected,

maintaining the retailer’s existing net margin, the affordability

level falls -1.2% below the current Occupational Cost Ratio in

2023 but returns in 2024 with headroom rebuilding beyond in

2025 to +2.4% aided by continued cost stabilisation, business

rate reductions and some modest sales growth

• The occupational affordability for our tenants set to further

improve from 1 April 2023 when reduced business rates become

effective with an average reduction of 16% across the portfolio

• Retail parks are a key investment area for NewRiver given their

prominent role within omnichannel retail for both consumers and

retailers. They have click & collect-friendly characteristics such

asfree, surface-level parking and good access; and we are

developing innovative click & collect solutions e.g collection &

return pods in car parks. Conveniently located on key arterial

routes and having large units suitable for holding stock at low

occupational costs mean retailers can use stores as fulfilment

centres much closer to their consumer than distribution centres.

-10

+10

+27

Retail

All Properties

Offices

Industrial

-16

NewRiver

Source: VOA

Percentage Change in Rateable Values 2017-23 leading

to lower occupational costs

Revaluation Movement (%)

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Investment

Market wide yield expansion

2022 started strongly with transaction volumes improving

across all retail sub-sectors for the first time since 2013

attractedby the relative discount to other property sectors.

However activity in the second half was relatively muted as

rising interest rates led to re-pricing across most sectors.

Retailvalues were to a lesser extent impacted due to the

re-basing it already experienced during the pandemic whilst

other sectors saw its first outward yield shift in years. The MSCI

March 2023 Quarterly index saw capital value declines in the

12 months to March 2023 to -23% in Industrial, Offices at -15%,

Retail Warehouses at -12% and Shopping Centres at -11%.

Thisdecline was primarily within the 3 months to December

2022 with capital values broadly stable since, save for

Officeswhich declined -2.4% in the 3 months to March 2023.

Retail Warehouse Market – Stability Resumed

The Retail Warehouse market has continued to attract strong

investor demand with £3.4 billion transacted across 152 dealsin

2022. Despite a quiet end to the year as property investment

paused, the significant activity in the first half of the year

resulted in 2022 being the 3

largest year in the past 10 years

and 21% above the average transaction volume across the same

period. Average transaction size has increased year on year

due to investor confidence in multi-let retail parks and 2022 saw

some of the sector’s large single asset transactions. Stability has

returned to the Retail Warehouse market in 2023 and investors

remain attracted by the robust occupational story, appeal to

consumer and attractive yield and high quality income versus

other sectors relative to the risk profile.

Shopping Centre Market – Risk Already Priced In

The Shopping Centre market also experienced a buoyant start

to 2022 following its recovery in 2021 and by the end of the first

half of 2022 was exceeding 2021 levels. 2022 saw £1.53 billion

transacted across 66 transactions with a notable increase in

activity on £50m – £100m centres with 9 transacting in 2022, up

from only 3 in 2021. There have been a wide range of buyers

from developers, property companies and private investors to

owner occupiers and international investors. The impact of the

ongoing cost of living crisis and higher interest rate environment

is to a large extent already price in and although the

£235 million transacted in Q1is considered low, this is due to a

lack of stock whilst capital targeting the sector has increased

given the sector is no longer just considered a counter-cyclical

play. Investors have been attracted by the strong fundamental

income, already high re-based yield and premium against bond

rates and other property sectors.

(7.9)

2.3

(5.1)

(6.8)

(15.7)

(12.2)

(20.4)

NewRiver

Retail

Shopping

Centres

Retail

Warehouse

Supermarket

Office

Industrial

(12.7)

(6.2)

(10.8)

(12.1)

(19.9)

(15.3)

(23.2)

NewRiver

Retail

Shopping

Centres

Retail

Warehouse

Supermarket

Office

Industrial

5.4

9.0

6.4

5.9

5.2

3.6

NewRiver

Retail

Shopping

Centres

Retail

Warehouse

Supermarket

Office

Industrial

Total Return

MSCI UK Sector 12 Month Return

(%)

Capital Return

Income Return

Source: MSCI

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our marketplace continued

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Transaction Vol (LHS)

2017 2018 2019 2020 2021 2022

No of Deals (RHS)

Transaction Volumes £m

No. of transactions

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

100

120

140

160

180

200

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

No of Deals (RHS)Transaction Vol (LHS)

Transaction Volumes £m

No. of transactions

Retail Warehouse Transaction Volumes

Shopping Centre Transactions Volumes

NewRiver’s response

• NewRiver’s portfolio like-for-like valuation decline of 4.7% in the

second half of the year represents a significant outperformance

versus the MSCI All Retail Index which experienced a capital

decline of -10.8%. Core Shopping Centres, representing 37%

of the total portfolio, were broadly stable in the second half and

Retail Parks, representing 28% of the total portfolio, recorded

a modest 3.5% decline due to market driven yield movement,

partially offset by positive ERV growth

• Our Retail Warehouse portfolio NIY now stands at 7.0%, an

outward yield shift of +35bps in second half of the year and

+80bps above its MSCI benchmark. From March 2021 to March

2022 the MSCI Retail Warehouse index experienced 130bps

yield compression with the NIY peaking at 5.5% at which point

the yield gap to NewRiver widened from +40bps to +80bps.

As such, the MSCI index has seen greater volatility as yield

movements reversed especially at this lower yield level.

• Our Core Shopping Centre portfolio NIY now stands at 9.6%,

+210 bps above its MSCI benchmark. Valuations have been

in part insulated from the overall market movements due

to the strong operational performance over the financial year,

affordable rental levels and already high yield and delivered

a -0.7% valuation decline for the year.

• The NewRiver portfolio has significantly outperformed its MSCI

Benchmark due to its strong income component and more

stable valuations. This has resulted in a Total Return

outperformance of +1,020bps, with an outperformance in Capital

Return of +660bps and Income Return of +350bps.

• Liquidity is expected to return to the market as the peak

uncertainty has now passed and investors can now assess

and price in a relatively calmer market. A key attraction will

be the high income component of the retail market, a key driver

of total returns in 2023, which is hard to match in other sectors.

Source: Savills

Source: Cushman & Wakefield

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Our purpose

To own, manage and develop

resilientretail assets across the UK that

provide essential goods and services

and support the development of

thriving communities.

What sets us apart

Our resilient and focused portfolio,

market leading operating platform

andfinancial flexibility mean we

areoptimally positioned for

futuregrowthand to achieve

ourobjectiveofa consistent

10%TotalAccounting Return.

3. Flexible

balance sheet

Our operating platform is underpinned

by a conservative, unsecured balance

sheet. We are focused on maintaining

our prudent covenant headroom position

and have access to significant cash

reserves which provide us with the

flexibility to pursue opportunities which

support our strategy forgrowth.

1. Disciplined

capital allocation

We assess the long-term resilience of our

assets,withcapital allocation decisions made by

comparing riskadjusted returns on our assets to

those available from otheruses of capital.

Capital allocation decision include investing intoour

portfolio, acquiring assets in the direct real estate

market and share buybacks. Assets can be

acquiredeither on our balance sheet or in capital

partnerships. Our significant market experience

allows us to price risk appropriately, andourlow

average lot sizes enhance liquiditywhich

meanswecan execute disposals

quickly and effectively.

2. Leveraging

our platform

We leverage our market leading platform to

enhance and protect income returns through

active asset management across our assets

and on behalf of our capital partnerships; the

latter also provide enhanced returns through

fee income and the opportunity to receive

promote fees. We also create income and

capital growth through our Regeneration

activity in a capital light way, principally

residential-led, focused on replacing surplus

retail space with much needed new homes.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic ReportStrategic report

Our business model

Delivering value for

our stakeholders

Strategic Report

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Our sustainable approach

Stakeholder value created

Our business model is underpinned

by our active ESG programme using

industry-recognised indices to track

our sustainability performance.

Our team

The success of the Company comes from

its people. We have created a collaborative

and flexible working environment and

provide support for the team to unlock their

full potential. We are proud of our retention

rate which demonstrates the value of our

people- centric approach.

Our communities

Our assets are located in the heart of

communities throughout the UK and

play anintegral role in the lives of our

customers. Inmany locations we are a

major investor in thetown and we take

this responsibility very seriously, working

hard to meet the everyday needs of local

people and support causes that matter to

the communities we serve.

Our shareholders

Our shareholders are the ultimate owners

of our business. In order to continue to grow

the business we aim to ensure our investors

understand and support the Company’s

strategy, business model, investment case

and progress. We actively engage with

shareholders to provide regular business

updates through corporate communications,

in-person and digital meetings as well

site visits.

75%

team retention of 5+ years

No. of different UK communities we are

directly invested in or manage assets within

FY23 investor meetings

See page 22 for more information See page 24 for more information See page 26 for more information

Our capital partners

Capital partnerships are an important part

of our business, contributing to overall

earnings growth. Our capital partners

leverage our market leading platform by

allowing us to manage and improve the

performance of their assets. Capital

partnerships allow us to acquire assets in a

capital light way and receive proportional

rental income, as well as enhance our

returns from asset management fees with

the potential to receive financial promotes

linked to performance.

Our occupiers

When our occupiers thrive then so too can

NewRiver. We continuously nurture our

working relationships with our occupiers

sowe can better understand their needs

and potential challenges or opportunities

and ensure our portfolio is best placed to

accommodate them.

We are proud to see so many of our

occupiers choose to remain in our portfolio

at the point of potential exit.

Our environment

The real estate industry has a critical role to

play in protecting the long-term sustainability

of our planet. We take our role as the

custodians of assets within the community

very seriously, and that involves integrating

our sustainability strategy across all aspects

of our business from head office to asset level

and our local communities.

Number of capital partnership assets

under management (April 2023)

19 x retail parks and 5 x shopping centres

92%

FY23 occupier retention rate

NewRiver ranked first place in the

GRESB Management module out of

901 participants across Europe

See page 44 for more information See page 6 for more information See page 58 for more information

NewRiver was named in the

Sunday Times Best Places

to Work 2023

We are delighted to have been acknowledged post-

period in the ‘small organisation’ category (10-49

employees) in The Sunday Times Best Places to

Work2023 for our wide-ranging benefits package

andongoing commitment to supporting our team and

their career development in a collaborative, diverse

andinclusive culture.

See page 20

OUR STAKEHOLDERS

The success of our business is underpinned by our best in class

team and effective relationships with our multiple stakeholders.

We are proud of our highly motivated, collaborative and well-balanced

team with a near 50:50 gender split. Our team continue to focus on

helping drive the business forward whilst also advancing their own

career development. We foster strong working relationships with

our wider stakeholders who collectively help us deliver on our

strategy, business model and ongoing success. We recognise that

our stakeholders have a range of varying priorities and concerns

and we endeavour to incorporate these into our own strategic

decision-making.

Board engagement

Critical to effective corporate Governance is how the Board aligns

strategic decisions with the Company’s purpose, values, strategy and

stakeholders. The NewRiver Board has a clear stakeholder engagement

plan, regularly consulting with the NewRiver team, who in turn manage

and foster the relationships with our occupiers, key partners and advisers.

Stakeholder engagement

Authentic stakeholder engagement

underpins our business

NewRiver was named in the Sunday

Times Best Places to Work 2023

We are delighted to have been acknowledged in May 2023 in the

‘small organisation’ category (10-49 employees) in The Sunday Times

Best Places to Work 2023 for our wide-ranging benefits package and

ongoing commitment to supporting our team and their career

development in a collaborative, diverse and inclusive culture.

We received positive survey results with strong approval and

engagement ratings of 82% with a “confidence in management”

score of 80% and achieved a rate of “Excellent” across all areas.

At NewRiver we provide a flexible working environment to suit the

different lifestyles of our team, and important policies including

full-private medical cover, ‘gender-agnostic’ shared parental leave and

wider flexible working patterns were recognised by the Sunday Times.

Our commitment to offering colleagues practical support for career

development and empowerment, providing the best possible

opportunity for them to develop their careers was also recognised.

The Sunday Times equally acknowledged that our team are rewarded

with a fully paid six-week sabbatical after 10 years of service.

Our Stakeholders include:

Local

Authorities

Shareholders

Environment

Occupiers

Capital

Partners

Team

Lenders

Communities

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

“At NewRiver people are our greatest asset and it is

therefore an honour to have been named in The

Sunday Times Best Places to Work 2023. The fact that

75% of the NewRiver team have been at the company

for more than five years is testament to the positive

working environment and culture that we have built.

We are a driven, collaborative and well-balanced team

with a near 50:50 gender split and indeed it is the

team themselves that actively participate in creating

such a positive and attractive environment. I would like

to take this opportunity to thank the entire NewRiver

team for all their hard work in helping to continue to

drive the business forward. It would not have been

possible withouteach and every one of them.”

Edith Monfries

Chief Operating and People Officer at NewRiver REIT

Employees

75%

Of our team have

worked at NewRiver

for 5+ years

Hours of training per

employee thisyear

1,150

Total hours of

training this year

70%

Of our team undertook

professional training

during theyear

64%

Of our team have

professional

qualifications

Hours of volunteer support

dedicated to the Trussell Trust

SECTION 172(1) STATEMENT

The Directors consider, both individually and collectively, that they have acted in the way they consider, in good faith, would be most likely to

promote the success of the Company for the benefit of its members as a whole (having regard to the stakeholders and matters set out in

section 172(1)(a-f) of the Companies Act 2006) in the decisions taken during the year ended 31 March 2023.

Details of our key stakeholders and how the Board engages with them can be found in the strategic report on page 20. Further details of the

Board activities and principal decisions are set out on page 103 providing insight into how the Board makes decisions and their link to strategy.

Other disclosures relating to our consideration of the matters set out in s172(1)(a-f) of Act can be found as follows:

S172 factor Our approach

the likely consequence of any

decision in the long term

As a Board of a REIT owning assets which also include arisk-controlled development pipeline, the Board

is always conscious of the long term. Looking to the future the Board and Executive Committee regularly

assess the overall corporate strategy and acquisition, asset management and disposal decisions in the

context ofcurrent and future long-term trends and markets. Weclosely assess the latest trends reported

by CACI, ourresearch provider, to ensure we are aligned with evolving trends. These insights and the

Board’s ownextensive experience steer the long-term strategicdirection.

the interests of the

company’s employees

We have a small workforce which allows a naturally close proximity between them and the Board making

it easy for the Board to engage with staff directly especially as the Directors regularly visit the London

office and other sites. This year the Directors have been able to visit the assets and the London office

more freely and attend social events with staff.

the need to foster the company’s

business relationships with

suppliers, customers and others

The Board is committed to fostering the Company’s business relationships with occupiers, local

authorities and other stakeholders. These stakeholders are key to our business model and therefore

members of the Exco (including Board members) have direct responsibilities for managing and

developing these relationships. Board site visits during the year have helped these relationships and

understanding the needs of these stakeholders.

the impact of the company’s

operations on the community

and the environment

The Board is committed to our communities and our assets are integral to the communities they serve.

We aim to enhance the lives of consumers and minimise our impact on the environment. These matters

are therefore considered in all strategic decisions and embedded into the business model.

the desirability of the company

maintaining a reputation for high

standards of business conduct

Our values mirror our culture and as a team our values are to be trusted and respected and this is

entrenched into Board decisions. Staff receive regular training on our anti-corruption policies to ensure

that they are entrenched in all staff decisions and conduct. Again the size and proximity of the workforce

allows our values to be communicated, embedded and monitored easily and less formally.

the need to act fairly as between

members of thecompany.

The Board recognises the importance of treating all members fairly and monitors the views of the

Company’s shareholders through reports on investor and analyst communications so that their views and

opinions can be considered when setting strategy.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Recruitment and talent

Our total head count across the Group at the close of the year was

46. Our approach to recruitment and development is entirely aligned

with the needs of the business today and our aspirations for the

future, whilst remaining committed to the unique corporate culture

that is one of NewRiver’s key strengths.

We are continuously working to develop the skills, capability and

performance of all employees. Our support ranges from funding

professional qualifications including RICS and ACCA to informal

training sessions and a bi-weekly team meeting to empower the team

with research and knowledge to help enhance their day-to-day role.

We continue to support the UK Government’s Apprenticeships

Scheme. During the year 70% of our staff undertook professional

training and employees across the business spent a total of 1,150

hours on training, including Continuing Professional Development.

We appraise our team annually, undertaking a tailored performance

review which includes a professional development plan which allows

our team to set objectives, track progress and fulfil their potential.

Diversity

As a Company, we are committed to a culture of diversity and

inclusion in which everyone is given equal opportunities to progress

regardless of gender, race, ethnic origin, nationality, age, religion,

sexual orientation or disability. Our ethnicity representation is 17%.

We also have a Diversity and Representation committee who meet

regularly to promote inclusion across the business. We believe there

is a broad composition of diversity across the business, and this was

recognised by the 2023 Sunday Times Best Places to Work survey

where we scored “Excellent” in our Diversity and Inclusion measures.

Details of Board and Executive Committee composition can be found

in the Nomination Committee Report on page 102.

Reward and Recognition

Our team are dedicated to achieving the results that we deliver year

on year and the Board is committed to rewarding this hard work

through our remuneration policies; this includes bonus entitlements

to reward excellent performance, and also through our Long Term

Incentive Plan to help secure retention of our talented team.

The Company offers a range of benefits to our team, some particular

highlights include:

• flexible hybrid working with 3:2 days split in the office/on site: at home

• full private medical cover for all staff

• ‘gender-agnostic’ shared parental leave

• training and career development

• an electric car scheme

• six week paid sabbatical to employees who have been with the

business for 10+ years

• mental and physical health resources and training

• staff volunteering policy enabling staff to take time off to volunteer for

our charitable partner The Trussell Trust or a charity of their choice

The team also have the opportunity to discuss the benefits available

with specialist advisers to ensure that they suit their needs. We

review the benefits each year to ensure they meet employee

expectations and industry benchmarks.

Gender & Ethnicity representation

across the business

We are proud to say that we have a very even gender balance

across the business:

Group

50%

Female Male

Read more information about our

Diversity & Inclusion on page 74

OUR TEAM

At NewRiver we know that the success of

the Company comes from the people within

our team.

Our people strategy ensures a collaborative, inclusive and flexible

working environment for our whole team. We are proud to say this

has been recognised in May 2023 having been named one of the

best places to work in the UK by The Sunday Times following our

inclusion in the recently published Sunday Times Best Places to

Work2023 list after entering for the first time earlier in the year.

Communication, collaboration and respect sit at the heart of our

people strategy which harnesses the power of the team to drive

ourbusiness forward.

At NewRiver we provide support for every member of the team,

witha wide range of well-being initiatives to ensure an effective work/

life balance. Training and Development is key to empowering our

loyal team and ensuring that everyone has a chance to unlock their

full potential.

Our flexible working policy fosters a positive working environment

tosuit the different lifestyles of our team. As well as flexible working,

we offer an attractive and wide-ranging benefits package including

full-private medical cover and ‘gender-agnostic’ shared parental

leave together with training and career development in a collegiate,

diverse and inclusive culture. Long-serving team members are also

rewarded with a fully paid six-week sabbatical following 10 years of

service; and we also offer an opt-in salary sacrifice for electric cars

and a policy enabling staff to take time off to volunteer. Our high staff

retention testifies the team satisfaction with over 75% of our staff

having worked at NewRiver for 5 years’ or more.

17%

Ethnicity

Representation

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Stakeholder engagement continued

Strategic Report

Board Engagement during the year

Our Board have a comprehensive

engagement strategy working to engage

the wider team, including an active outreach

programme with Board Directors visiting

assets to meet the centre management

teams, our occupiers and local authorities.

A regular staff forum ensures that there is effective communication

and interaction between the Board, Senior Management and the

wider Team. We regularly provide the opportunity for our Non-

Executive Directors to meet the team both formally and informally,

both in confidence or in wider forum. This included hosting a low-key

gathering in our new offices on Whitfield Street for the Board and

wider team to come together informally.

Alastair Miller, our designated Non-Executive Director responsible for

engaging with the NewRiver team, also held a team engagement

session in person and online to listen to perspectives from across the

team as well as allowing staff the opportunity to hear from Alastair

around the work of the Remuneration Committee, particularly in the

context of the Remuneration Policy Review.

We also participated in the Sunday Times Best Places to Work

survey, which showed engagement scores (82%) above industry

averages of 72% and we scored 80% for ”confidence in

management” versus the benchmark of 68%.

We hold monthly staff meetings which cover a range of topics

tokeep the team in touch with the business and promote wider

sectorknowledge, with external speakers and staff-driven agendas.

This year our Senior Leadership Team also held an externally

facilitated training and a strategy day focusing on leadership

skillsand to discuss key business objectives and crystallise how,

working with the Executive Management team, it could help drive

business efficiencies and growth.

Read more information on our

Section 172(1) Statement on page 21

Sustainable Development Goals (SDGs)

We have included case studies of various initiatives delivered

throughout the year and we have highlighted within each one how

they fulfilled the Sustainable Development Goals (SDGs) as set out in

this key:

Health and Well-being

We recognise that our people are our greatest asset and we are

committed to improving the quality of our employees’ working lives

by providing a safe and healthy working environment. Our aim is to

create a positive working environment by integrating well-being in all

work activities and by empowering our people to make positive

choices regarding their health and well-being.

Physical Environment

and Flexible Working

This year we relocated to a new office space on Whitfield Street in

Fitzrovia. The office is within one of the greenest office buildings in

London, access to an attractive communal shared office space and

extensive fitness and well-being facilities including bike lockers and a

variety of hosted well-being classes and branded pop-ups. The

London office space is open plan with hot-desks which has helped

our team become more digitally-centric and print less paper. The

office environment provides easy accessibility to management and

the opportunity for team members at all levels to communicate and

engage across teams and to learn from colleagues in a more

relaxed environment.

We offer all staff the ability to work from home two days a week, with

three days spent in the office or at assets where we work around

core hours to enable staff to travel and organise their days to best

suit them, be it time with family or to undertake fitness or hobbies.

We believe our working policies are effective in how it translates

through to our low absentee rates of less than 0.1%.

Our dedicated Diversity and Representation Committee meet

regularly and implement initiatives to engage and motivate the

wider team.

Mental Health

The pandemic helped shine a brighter spotlight on the importance of

ensuring good mental health. We are in our second year of working

with a mental health charity, Chasing The Stigma, to ensure that

mental health is normalised in both the workplace and our wider

communities. We have a number of trained mental health first aiders

at Head Office but this year we also provided important mental health

training via Chasing The Stigma’s dedicated mental health

programme called Ambassadors of Hope. Training was delivered for

across the NewRiver shopping centre on-site teams as well as to the

NewRiver Head Office team including all of our Executive Committee.

We now have 136 Ambassadors of Hope across our business and in

our assets, whose training enables them to support the work of the

charity in enabling signposting to mental health support resources

available locally and nationally.

Find out more here: www.chasingthestigma.co.uk

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

How did we engage?

• Staff Forum and bi-weekly all staff briefing meetings

• Sunday Times Best Places to Work Survey 2023

• Regular Non-Executive Director office visits to allow the Board to

interact with and listen to the wider team

• Our comprehensive appraisal process with individual performance

reviews and development discussions

• Chasing The Stigma “Ambassador of Hope” mental health training

conducted at Head Office and across our shopping centres; all of

our Executive Committee undertook this important training

• Alastair Miller, our designated Non-Executive Director responsible

for engaging with employees, has held team engagement sessions

• Board Directors visited assets across the portfolio to better

understand the assets and spend time with the property team and

local on-site teams

Topics raised

• Leadership and Strategy

• Opportunities for personal and career development

• Knowledge sharing across the Company

• Well-being and flexible working

• Rewards and benefits

• Fostering a diverse and inclusive culture

• Our ESG strategy

How did we respond?

• Findings from the employee survey are being used to map out

Company level engagement priorities

• Continued to provide a range of physical and mental

well-being services

• Continued to encourage employee shared ownership in

the Company’s success through the award of all-employee

share schemes

• Training and information sessions conducted on key topics raised

• Expanded our Diversity Policies

• Diversity Training arranged with an external company, scheduled

for July 2023

• Leadership Skills Training

OUR COMMUNITIES

Our assets are located in the heart of

communities throughout the UK and play an

integral role in the lives of our customers.

Supporting our Communities in

the Cost-of-Living Crisis

The social enterprise, Green Rose, spent a month at the Arndale

Centre, Morecambe offering the local community free advice

and support on energy issues. The pop-up’s mission was to help

the community to save money and make their homes more

sustainable during the current energy and cost-of-living crisis.

In many locations we are one of the largest real estate owners and

we take this responsibility very seriously and Board Directors visit

assets regularly to see them in action and understand how they

provide for the local community and wider town. We aim to

strengthen the communities we operate in providing for the everyday

needs of locals through our shops and services and supporting the

causes that matter to them.

Read more about our community engagement

initiatives on pages 25, 57, 77 and 78

Board Engagement during the year

How did we engage?

• Review of Company purpose, regular reporting to the Board

through the quarterly CEO report and quarterly ESG reporting

• Received presentations from Development team on Community

Investment Plans

• Directors volunteered at Trussell Trust food banks

• Board Directors visited assets across the portfolio meeting with

local teams alongside the asset and development managers

• The Board considers potential impacts to local residential areas

where Regeneration and broader developments are under

discussion, including during the planning process relating to key

developments across our portfolio

• Requests for capital expenditure approval require consideration of

how the projects could benefit the local community including

improvement of the retail and services offer, creation of new jobs

and homes, public realm enhancement and environmental impact.

• Regular consultation with local community groups, through our

development work, to enable us to understand their requirements

and establish our priorities as a result – principally in Grays this year

• NewRiver representatives sit on the Board of several Town Funds

to help steer the direction of local economic and social growth

• Our Shopping Centre Managers organise regular events and

fundraising activities which bring people together, encourage

dialogue and support the development of thriving communities

TARA Youth Board,

hosted at NewRiver offices

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Stakeholder engagement continued

OUR OCCUPIERS

When our occupiers thrive, so too can we.

We continuously nurture our working relationships with our

occupiers, so we can better understand their needs and potential

challenges or opportunities. We have hand-picked our portfolio to

focus on occupiers that provide essential goods and services and to

support the development of thriving communities across the UK,

while deliberately avoiding structurally challenged sub-sectors such

as department stores and mid-market fashion.

We are proud that our portfolio offers excellent affordability of rents

with low occupational costs, demonstrated through our strong retailer

retention rate of 92% and an affordable average rent of £12. Our

on-site teams work hard to ensure that our assets are clean, safe, and

welcoming environments for all ages.

Board Engagement during the year

How did we engage?

• Regular retailer engagement underpins our asset management

strategy including regular meetings between Board Directors,

Executive Directors and our asset teams with our key occupiers,

listening to challenges and opportunities arising from the shop

floor to retailer head offices which is fed into our planning and

informs our strategy

• Part of these conversations with our retailers include our

environmental and sustainability strategies, including green leases,

enhanced data collection and on-site energy consumption

• The Board receives regular reports on occupier activity through

Exco reports and ESG reporting to inform future strategy

• The asset management team attend the annual Completely Retail

Marketplace in London where the retail real estate industry come

together to discuss new opportunities as well as expand and

consolidate existing leasing plans and asset management

initiatives

• Non-Executive Directors have attended industry conferences

alongside Executive Directors

Topics raised

• Topics raised via retailer and occupier meetings include

understanding the future needs of occupiers including sentiment,

performance, growth/contraction plans, sustainability initiatives and

potential opportunities and risks within our occupier base, green

leases and MEES compliance.

How did we respond?

• Continuing to collect energy data from our occupiers and assets

• Engagement with our occupiers regarding our Pathway to Net Zero

to help align with the occupier’s net zero ambitions

• Assisting with Business Rate reductions for our occupiers

• Board Directors sit on various industry committees helping shape

policy and strategy. NewRiver team members sit on The British

Property Federation’s (BPF) various committees including the Finance

Committee where our CFO sits, the Development and Sustainability

committees and our CEO chairs the BPF Retail Committee

• A NewRiver asset manager is Vice-chair of the Leisure Property

Forum, actively participating in engaging with retail and leisure

operators and sharing this industry insight with the wider team

through presentations and events.

• TARA: we continued our partnership with The Academy of Real

Assets, a charity whose mission is to engage students from under

served UK state schools and introduce them to a career in the

world of real estate by providing them with insight into, and

contacts within, the industry. One of our development managers

chairs and hosts the TARA Youth Board helping drive this agenda

Topics raised

• Town centre regeneration

• Creating long-term social and economic prosperity

• Responsible planning, development and design

• Community well-being and social value

• Environmental protection

How did we respond?

• We have donated £450,000 to the Trussell Trust to date since the

start of our partnership in June 2019 as well as donating physical

space at our assets and volunteering time from our team.

• Our centre teams undertake regular training to equip them with

appropriate skills and qualifications to help ensure the smooth

running of on-site teams, our occupiers and the centre in general.

• Enhanced social media use for community engagement.

Stopping UK Hunger

Since the inception of our partnership with the Trussell Trust, we

have raised over £450,000 in support of their mission to stop

UK hunger. Non-monetary support has included circa 10.5

tonnes of food donations; clothing donations including around

200 school uniforms for users of Morecambe Bay Foodbank;

digital advertising; over 200 volunteering hours; and letters to

MPs through the #keepthelifeline campaign.

“You are Important”

Our centre The Horsefair in Wisbech partook in the “You Are

Important” campaign, a large-scale collaborative art project

which involved Wisbech-based businesses and organisations

working with artists and local people to create a visual

celebration of every member of the community. Many of these

artworks also featured different languages to celebrate the

cultural diversity of Wisbech. The works, which were created

using a range of contemporary art practices, appeared in

different locations across The Horsefair and in Wisbech town

centre, providing a unique and positive experience for everyone

who viewed them.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

• The Board receives regular updates on market sentiment,

investor relations activity and share price performance

• The Remuneration Committee undertook a review of the

Remuneration policy in consultation with Shareholders for

which Shareholder provided positive support toward the

proposed revisions.

Topics raised

• Continued delivery of the Company’s revised strategy focused on

resilient retail following the pub business disposal in FY22

• Financial performance

• Operational performance

• Capital allocation

• Portfolio valuation performance

• Progress on the disposal of our Work-Out portfolio

• Progress across our Regeneration portfolio

• Growth of Capital Partnerships

• Sustainability

• Retailer challenges and opportunities

• Macro-economic themes including how inflation and rising energy

costs impact our retailer

How did we respond?

• Post pandemic virtual engagement continue to form a part of our

Investor Relations programme, allowing us to capitalise on

effective use of management time, engaging with international and

regionally based investors, and helping reduce associated carbon

emissions

• Our investor feedback has helped enhance our disclosures and

the supplementary information provided in results materials.

OUR LENDERS

We have strong working relationships with

our banks, bondholders and rating agency

who in turn help provide funding to facilitate

our strategy.

As part of this, we are in regular dialogue to ensure our banks and

bondholders understand the Company’s strategy and targets. These

relationships have helped ensure that the business remains in a

strong and flexible financial position with a fully unsecured balance

sheet. This structure is highly efficient and covenant-light, affording

us significant operational flexibility.

Board Engagement during the year

How did we engage?

• The CFO and finance team held regular meetings with our

relationship banks, bondholders and rating agency to ensure

that they are kept up to date with business strategy, developments

and performance

• Held meetings with our Bondholders as part of our FY22 and

HY23 results roadshow

• Debt structure and current and future debt requirements are

considered by the Board on a regular basis as part of the

CFO’s review

OUR SHAREHOLDERS

Our shareholders are the ultimate owners

ofour business. In order to deliver on all

ourambitions for the communities we are

invested in, it is critical that our shareholders

continue to understand and support the

Company’s strategy, business model,

investment case and progress.

We have an active engagement strategy, supported by our corporate

brokers, providing our shareholders with frequent business updates,

regular meetings, both in person and online, and on-site visits.

Where appropriate, our Board and members of the Executive

Committee will engage with shareholders.

The comprehensive calendar of investor engagement includes the

AGM, regulatory announcements and non-regulatory news flow,

conference calls and shareholders roadshows, as well as regular

contact with financial analysts, financial media, investors, private

client fund managers, retail investors and equity sales teams. Regular

and targeted engagement ensures that our strategy, business model

and investment case are well understood by shareholders and the

wider market.

Board Engagement during the year

How did we engage?

• Focused virtual and face to face investor meetings with

theCEOand CFO with a revival of face to face meetings

• Engagement includes the AGM, regulatory announcements,

conference calls and investor roadshows, as well as regular

contact with financial analysts, financial media, investors, private

client fund managers, retail investors and equity sales teams

• As well as institutional investors, we engage with retail investors

via direct communications, our website, media, Annual General

Meetings (AGM) and platforms including Investor Meet, hosting

adedicated retail investor presentation at our half year results

• Our relaunched corporate website contains comprehensive

information about our business, regulatory news and press

releases alongside information about our approach to

Environmental, Social and Governance (ESG) issues

• Management engaged with 96 investors during the year, including

shareholders and non-holders, and institutional and

retail investors

• We hosted our first post-pandemic in-person results presentation

to analysts in November 2022 for our HY23 Results – a live audio

webcast was also available our website with a replay function

• The 2022 AGM was again held as a physical meeting and was

attended by all of the Board. Recognising that some shareholders

may not have been comfortable attending in person, we provided

opportunities for shareholders to submit questions via email and to

attend via conference call

• The Board reviews and approves material and communications

with investors, namely trading updates, results announcements,

the Annual Report and Accounts, and significant business events

and transactions.

• The respective Committee Chairs engage with shareholders on

significant matters related to their specific areas of responsibility

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Stakeholder engagement continued

Fitch Affirmed NewRiver’s

Investment Grade Credit Ratings

Fitch Ratings affirmed our Long-Term Issuer Default Rating

(IDR) at ‘BBB’ with a Stable Outlook, senior unsecured rating

at ‘BBB+’ and Short-Term IDR at ‘F2’. The senior unsecured

rating applies to NewRiver’s £300 million unsecured bond

dated 2028.

“In the affirmation of our investment

grade credit ratings, Fitch has again

recognised NewRiver’s differentiated

position in the UK retail market, focused

on providing essential goods and

services to consumers on rental terms

affordable to retailers. This focus on

resilient retail, alongside our best in

class operating platform and the

strength of our balance sheet, means

wefeel well positioned despite the

challenging backdrop.”

Will Hobman

Chief Financial Officer

Topics raised

• Performance of retail operations including occupier trading, rent

collection, leasing, and occupancy

• Retail property valuations

• Progress of the disposal of our Work-Out portfolio

• Progress of our Regeneration projects

• Broader activity within the retail investment market

• Interest rate environment

How did we respond?

• Actions taken in FY22 mean we have no maturity on drawn debt

until March 2028 and no exposure to interest rate rises on our

drawn Group debt facility

• In December 2022 Fitch Ratings affirmed NewRiver’s Long-Term

Issuer Default Rating (IDR) at ‘BBB’ with Stable Outlook, our senior

unsecured rating at ‘BBB+’ and Short-Term IDR at ‘F2’

• We worked with two companies to undertake scenario stress

testing to predict the projected probability of failure of our

occupiers and assess their rental cashflow stability factoring in

increased pressures on retailer margins.

OUR LOCAL AUTHORITIES

We are proud to work in partnership with circa

60 different local authorities across the UK to

help regenerate and protect the towns we are

invested in to create long-term social and

economic growth.

Board Engagement during the year

How did we engage?

• Non-Executive and Executive Directors attended various senior-

level meetings with local authorities and public sector focused

organisations, alongside the asset and development team, meeting

all levels including Chief Executives and the wider cabinet,

Planning Officers, Regeneration Officers and also local Councillors,

to steer the regional strategy that will impact the social and

economic long-term viability of a town which has a direct impact on

our own assets

Topics raised

• Appreciation of Council priorities across the borough and the

significance of private sector-led regeneration

• Allocation of resources to the local authority planning team

• Local authority support for marginal regeneration projects that

bring a positive Benefit:Cost Ratio (BCR)

How did we respond?

• Our ongoing engagement with local authorities also extends to our

Capital Partnerships and we are pleased to report the ongoing

success of our asset management mandate with Canterbury City

Council to manage its new leisure development, Riverside as well

as their Whitefriars Shopping Centre which also includes a

development management mandate to relocate the Council offices

centrally and re-activate formerly dormant space.

OUR CAPITAL PARTNERSHIPS

As part of our growth strategy we have been expanding our Capital

Partnerships. We have created a standalone spread of this strategy in

more detail.

Please refer to page 44

OUR ENVIRONMENT

Please read our comprehensive ESG Strategic Report to find out

about our about commitment and progress.

Please refer to page 54

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Key performance indicators

Measuring our

strategic progress

Underlying Funds From Operations

£25.8m

28.3

11.5

52.1

55.1

25.8

2019

£m

2020 2021 2022 2023

Loan to Value

33.9%

34.1

50.6

47.1

36.9

33.9

2019

2020 2021 2022 2023

Description

Underlying Funds From Operations (‘UFFO’) measures

underlying operational profits and excludes one-off or

non-cash adjustments. We consider this to be the most

appropriate measure of the underlying performance of the

business, as it reflects our generation of operating profits.

Description

Loan to Value (‘LTV’) is the proportion of our properties that

are funded by borrowings. The measure is presented on

a proportionally consolidated basis. Maintaining an LTV of

less than 50% is one of our five key Financial Policies and in

addition our medium-term guidance is to maintain an LTV

of less than 40%.

Description

Retail occupancy is the estimated rental value of occupied retail

units expressed as a percentage of the total estimated rental value

of the retail portfolio, excluding development activities.

Description

The admin cost ratio is total administrative expenses as a

proportion of gross revenue on a proportionally consolidated basis,

including our share of administrative expenses and gross revenue

from joint ventures and associates. It is a measure of our

operational efficiency.

Our performance

Total UFFO for FY23 was £25.8 million down from a total UFFO

of £28.3 million in FY22. This is following disposal of the

Hawthorn pub business. However on a underlying retail only

basis this is up 26% from £20.5 million in FY22, which reflects

the continued recovery in our underlying operations and the

successful implementation of our finance and administrative

cost reduction initiatives.

Our performance

LTV has remained stable at 33.9% as at 31 March 2023,

reducing from 34.1% as at 31 March 2022, comfortably within

our guidance of <40%. We are committed to maintaining a

conservative LTV position given the current macro-economic

outlook we will not rush to redeploy to the 40% level and

instead intend to retain headroom at this level in the near-term

along with excess cash in the bank which together give us

maximum optionality.

Our performance

We achieved our highest occupancy level for five years, with

ahigh, stable retail occupancy of 96.7%, up from 95.6% in FY22,

demonstrating the resilience of our essential spend ledportfolio

and its continued attraction and suitability to occupiers.

Our performance

Our admin cost ratio was 15% for FY23 achieving a

reductionfrom 17% in FY22 principally following a reduction

inadministrative costs due to the disposal of the Hawthorn

business and the unlocking of administrative cost efficiencies.

Link to strategy, ESG and Remuneration

ESG

Link to strategy, ESG and Remuneration

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Retail occupancy

96.7%

95.6

95.8

94.8

95.2

96.7

2019

2020 2021 2022 2023

Admin cost ratio

15%

2019

2020 2021 2022 2023

Description

Underlying Funds From Operations (‘UFFO’) measures

underlying operational profits and excludes one-off or

non-cash adjustments. We consider this to be the most

appropriate measure of the underlying performance of the

business, as it reflects our generation of operating profits.

Description

Loan to Value (‘LTV’) is the proportion of our properties that

are funded by borrowings. The measure is presented on

a proportionally consolidated basis. Maintaining an LTV of

less than 50% is one of our five key Financial Policies and in

addition our medium-term guidance is to maintain an LTV

of less than 40%.

Description

Retail occupancy is the estimated rental value of occupied retail

units expressed as a percentage of the total estimated rental value

of the retail portfolio, excluding development activities.

Description

The admin cost ratio is total administrative expenses as a

proportion of gross revenue on a proportionally consolidated basis,

including our share of administrative expenses and gross revenue

from joint ventures and associates. It is a measure of our

operational efficiency.

Our performance

Total UFFO for FY23 was £25.8 million down from a total UFFO

of £28.3 million in FY22. This is following disposal of the

Hawthorn pub business. However on a underlying retail only

basis this is up 26% from £20.5 million in FY22, which reflects

the continued recovery in our underlying operations and the

successful implementation of our finance and administrative

cost reduction initiatives.

Our performance

LTV has remained stable at 33.9% as at 31 March 2023,

reducing from 34.1% as at 31 March 2022, comfortably within

our guidance of <40%. We are committed to maintaining a

conservative LTV position given the current macro-economic

outlook we will not rush to redeploy to the 40% level and

instead intend to retain headroom at this level in the near-term

along with excess cash in the bank which together give us

maximum optionality.

Our performance

We achieved our highest occupancy level for five years, with

ahigh, stable retail occupancy of 96.7%, up from 95.6% in FY22,

demonstrating the resilience of our essential spend ledportfolio

and its continued attraction and suitability to occupiers.

Our performance

Our admin cost ratio was 15% for FY23 achieving a

reductionfrom 17% in FY22 principally following a reduction

inadministrative costs due to the disposal of the Hawthorn

business and the unlocking of administrative cost efficiencies.

Link to strategy, ESG and Remuneration

ESG

Link to strategy, ESG and Remuneration

Key

Link to business model and strategic objectives

Disciplined capital allocation

Leveraging our platform

Flexible Balance Sheet

Link to ESG and Remuneration

ESG

Environmental, Social

and Governance

Remuneration

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Key performance indicators continued

Description

Interest cover is the ratio of our operating profit to our

netfinancing costs, on a proportionally consolidated basis,

including our share of operating profit and net financing

costsfrom joint ventures and associates. Maintaining interest

cover of morethan 2.0x is one of our five key Financial Policies.

Description

GRESB is the leading sustainability benchmark for the global

real estate sector. Assessments are guided by factors that

investors and the industry consider to be material in the

sustainability performance of real estate asset investments,

resulting in an overall score marked out of 100. Improvements

in our GRESB score can be used to measure the effectiveness

of our ESG programme.

Description

Total Property Return is a measure of the income and capital

growth generated across our portfolio. It is calculated

by MSCI Real Estate (formerly known as IPD) on our behalf,

using independent valuers. We assess our performance

against the market by comparing our returns to the MSCI

All Retail benchmark.

Description

Total Accounting Return (‘TAR’) is the change in EPRA Net

Tangible Assets (‘NTA’) per share over the year, plus dividend

paid, as a percentage of the EPRA NTA at the start of the year.

TAR performance relative to UK-listed Real Estate Investment

Trusts is a key metric used in setting the long-term incentive plan.

Our performance

Interest cover increased by 0.8x from 3.5x in FY22 to 4.3x in

FY23 due to the actions we completed in the prior year

including the debt reduction following the Hawthorn pub

business disposal, continued improvement of underlying retail

operations and the cash return we are generating by placing

our surplus cash on deposit. This level provides significant

headroom to our policy of 2.0x.

Our performance

This year we ranked 1

in the GRESB Management module

outof a 901 participants across Europe. We further improved

our score to 70/100 and were awarded an “A” alignment in

GRESB’s independent TCFD assessment. We also retained

our‘B’ Rating from CDP for our management of climate-related

issues as well as retaining our Gold Award in EPRA

Sustainability Best Practice Recommendations Awards.

Our performance

Our portfolio delivered a Total Return of 2.3% in FY23

compared to the MSCI All Retail benchmark at -7.9% due to the

inherent high income component of our portfolio.

Our core shopping centres and retail parks delivered capital

returns of -0.7% and -3.2%.

Our performance

We delivered a total accounting return of -4.6%, impacted by

the portfolio valuation decline of -5.9%, compared with -6.6% in

the prior year. We paid a 6.8 pence dividend for the year, offset

by movement in NTA.

Link to strategy, ESG and Remuneration

ESG

Link to strategy, ESG and Remuneration

ESG

Interest cover

4.3x

3.5

2.3

4.8

5.1

4.3

2019

ratio

2020 2021 2022 2023

GRESB Score

2019

number

2020 2021 2022 2023

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Key

Link to business model and strategic objectives

Disciplined capital allocation

Leveraging our platform

Flexible Balance Sheet

Description

Interest cover is the ratio of our operating profit to our

netfinancing costs, on a proportionally consolidated basis,

including our share of operating profit and net financing

costsfrom joint ventures and associates. Maintaining interest

cover of morethan 2.0x is one of our five key Financial Policies.

Description

GRESB is the leading sustainability benchmark for the global

real estate sector. Assessments are guided by factors that

investors and the industry consider to be material in the

sustainability performance of real estate asset investments,

resulting in an overall score marked out of 100. Improvements

in our GRESB score can be used to measure the effectiveness

of our ESG programme.

Description

Total Property Return is a measure of the income and capital

growth generated across our portfolio. It is calculated

by MSCI Real Estate (formerly known as IPD) on our behalf,

using independent valuers. We assess our performance

against the market by comparing our returns to the MSCI

All Retail benchmark.

Description

Total Accounting Return (‘TAR’) is the change in EPRA Net

Tangible Assets (‘NTA’) per share over the year, plus dividend

paid, as a percentage of the EPRA NTA at the start of the year.

TAR performance relative to UK-listed Real Estate Investment

Trusts is a key metric used in setting the long-term incentive plan.

Our performance

Interest cover increased by 0.8x from 3.5x in FY22 to 4.3x in

FY23 due to the actions we completed in the prior year

including the debt reduction following the Hawthorn pub

business disposal, continued improvement of underlying retail

operations and the cash return we are generating by placing

our surplus cash on deposit. This level provides significant

headroom to our policy of 2.0x.

Our performance

This year we ranked 1

in the GRESB Management module

outof a 901 participants across Europe. We further improved

our score to 70/100 and were awarded an “A” alignment in

GRESB’s independent TCFD assessment. We also retained

our‘B’ Rating from CDP for our management of climate-related

issues as well as retaining our Gold Award in EPRA

Sustainability Best Practice Recommendations Awards.

Our performance

Our portfolio delivered a Total Return of 2.3% in FY23

compared to the MSCI All Retail benchmark at -7.9% due to the

inherent high income component of our portfolio.

Our core shopping centres and retail parks delivered capital

returns of -0.7% and -3.2%.

Our performance

We delivered a total accounting return of -4.6%, impacted by

the portfolio valuation decline of -5.9%, compared with -6.6% in

the prior year. We paid a 6.8 pence dividend for the year, offset

by movement in NTA.

Link to strategy, ESG and Remuneration

ESG

Link to strategy, ESG and Remuneration

ESG

Link to ESG and Remuneration

ESG

Environmental, Social

and Governance

Remuneration

Total Property Return

+2.3%

7.5

-6.9

-5.4

1.3

2.3

2019

2020 2021 2022 2023

Total Accounting Return

4.6%

-6.6

-24.9

-14.7

-3.3

-4.6

2019

2020 2021 2022 2023

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

FOCUSED

PORTFOLIO

As the leading UK retail real estate

company we understand what makes

a resilient retail asset and we know how

to protect and enhance resilience over

the longer term.

RESILIENT RETAIL

28%

11%

23%

37%

Retail Parks

Shopping Centres

– Core

Shopping Centres

– Regeneration

Shopping Centres

– Work Out

Other

28%

11%

23%

37%

Retail Parks

Shopping Centres

– Core

Shopping Centres

– Regeneration

Shopping Centres

– Work Out

Other

Portfolio Weighting

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Portfolio review

Strategic Report

Operational Update

Robust and consistent operational metrics continue to demonstrate the underlying resilience and active demand for space in our portfolio,

supported by the strong performance of the physical retail store channel and resilient consumer. Net property income adjusted for disposals

increased by +5.0% in the 12 months to March 2023, occupancy increased to 96.7% (FY22: 95.6%) and rent collection remains at normalised

levels of 98% (FY22: 96%).

As a 31 March 2023 Occupancy

Retention

Rate

Rent

Collection Affordable Average Rent

Gross to Net

Rent Ratio

Leasing

Volume

Leasing

Activity

Average CAGR

FY21-FY23

(%) (%) (%) (£ psf) (Ave. pa) (%) (sq ft)

% vs valuer

ERV (%)

(Average

Lease Length)

Retail Parks 97.5% 100% 99% £12.49 £116,000 97% 163,400 0.8% 0.6% 12.3

Shopping Centres

– Core 97.7% 90% 98% £13.18 £39,000 94% 309,700 2.3% -0.8% 9.9

Shopping Centres

– Regen 97.4% 97% 100% £13.00 £69,000 86% 138,700 -3.9% -0.7% 9.4

Shopping Centres

– Work Out 92.8% 89% 97% £9.13 £23,000 65% 338,800 -2.1% -0.4% 6.7

Total

96.7% 92% 98% £11.98 £45,000 88% 979,200 1.1% -0.4% 10.0

1. Total includes Other representing 1% of total portfolio by value

In total, we completed 979,200 sq ft of leasing transactions during the year, securing £7.9 million of annualised income. Our long-term leasing

transactions which represented 69% of the total rent secured were transacted at rents +1.1% above valuer ERVs.

Over three quarters (77%) of the annualised long-term rent secured was in our Core Shopping Centre and Retail Park portfolios, at rents exceeding

valuer ERVs by +2.3% and +0.8% respectively. This is a reflection of the excellent occupational demand across our Core Shopping Centres, at the heart

of their local communities, and conveniently located Retail Parks predominately adjacent to major supermarkets, demonstrating we own the right assets

in the right locations.

OUR HIGHLIGHTS

Portfolio Metrics asat31 March 2023

Occupancy

96.7%

FY22: 95.6%

Retention Rate

92%

FY22: 90%

Rent Collection

98%

FY22: 96%

Leasing Volume

979,200 sq ft

FY22: 1,039,800 sq ft

Leasing Activity

+1.1%

ahead of valuer ERV

FY22: +7.4%

Affordable

AverageRent

£11.98 per sq ft

FY22: £11.74 per sq ft

Average CAGR

FY21-FY23

-0.4%

on 10.0yr average

previouslease period

Gross to Net RentRatio

88%

FY22: 84%

Total Return

2.3%, +1,020 bps

outperforming the MSCI All Retail over 12 months

FY22: 7.5%

Portfolio NIY of

8.0%, +220bps

versus the MSCI All Retail at 5.9%

FY22: 7.9%

Expanding Capital Partnerships across public,

private equity and institutional sectors

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Our Capital Partnerships continue to grow having secured a

high-quality mandate from M&G Real Estate in November 2022 to

asset manage a large retail portfolio, with a further south-east

shopping centre added to this mandate subsequent to our

appointment. The portfolio currently comprises 16 retail parks and

two shopping centres. Our key partnerships are across the public,

private equity and institutional sectors illustrate the importance of

specialist retail partners in a highly operational sector and

endorsement of the quality of our asset management platform.

Valuation

As at 31 March 2023, our portfolio was valued at £593.6 million

(31 March 2022: £649.4 million). Movements from the previous

year were the disposal of two Work Out assets and a solus retail

warehouse unit (£22.4 million) and a like-for-like valuation movement

of -5.9% for the year. This is a +660bps capital return outperformance

compared to the MSCI All Retail index.

Valuations were broadly stable in the first half of the year at -1.3%,

followed by a -4.7% movement in the second half, a reflection of the

macro-economic, political and financial market pressures impacting

all real estate markets. The valuation movement was predominately

a result of market driven yield expansion, a direct impact of rising

interest rates, whilst ERVs were broadly stable at -1.7% for the total

portfolio and +0.4% excluding our Work Out portfolio and

Regeneration assets.

Our Core Shopping Centre Portfolio, which represents 37% of the

portfolio, delivered a modest valuation movement of only -0.7% for

the year, a result of a strong operational performance and already

high yield of 9.6%. This is a +1,010bps capital return outperformance

compared to the MSCI Shopping Centre index.

Retail Parks, representing 28% of the portfolio, saw a movement

of -3.2% driven by some modest yield expansion offset by a

+2.7% increase in LFL ERVs. This is a +960bps capital return

outperformance compared to the MSCI Shopping Centre index.

The overall portfolio valuation movement was concentrated in the

Regeneration portfolio with a movement of -14.1% which accounts for

62% of the overall portfolio movement, the outcome of high inflation

on assumed construction and finance costs.

The Work Out portfolio following two disposals now accounts for

only 11% of the total portfolio and experienced a -7.8% valuation

movement due to negative NOI and ERV movements. This was

concentrated in three assets where turnaround strategies are in

place and progressing well. Nevertheless, on a capital return basis,

our Work Out portfolio outperformed the MSCI Shopping Centre

index by +10bps.

Portfolio review continued

Whilst rent secured within our regeneration portfolio was down -3.9%

versus valuer ERV, it was 9.0% ahead of the previous passing rent

and therefore accretive to rental cashflows. It is also reflective of our

ongoing strategy to ensure greater lease flexibility to support our

vacant possession strategy. We have been making good progress

across our three regeneration assets which are predominantly

focused on reducing surplus retail and delivering new residential

units to these locations within commuting distance of London. At

Grays, we are at an advanced stage in our preparations to submit

an outline planning application for 850+ homes and in Burgess Hill,

a site with detailed planning consent for 187 residential units, is being

prepared for sale.

The Work Out portfolio leasing activity was on terms -2.1% versus

valuer ERV, however, this part of our portfolio only represents a small

proportion of the long-term rent secured. Disposals this year totalled

£23 million at -10% discount to book value, principally from the Work

Out portfolio. Having completed the sales of shopping centres in both

Wakefield and Darlington we remain focused on exiting the Work Out

portfolio, which now accounts for only 11% of the total portfolio, via further

sales and implementation of turnaround strategies by the end of FY24.

For total portfolio lease events in FY23, the rents achieved had a

CAGR versus the previous passing rent of only -0.5% over the

average previous lease period of 10.3 years. Over the past three

years, this is only -0.4% based on an average previous lease period

of 10.0 years, illustrating the limited annualised rental decline and for

the Retail Parks is positive at 0.6%. Retail Park occupancy stands at

98% and the limited availability of space should deliver rental growth

going forward.

Overall, our long-term leasing transactions had a weighted average

lease expiry (WALE) of 8.2 years, up from 6.4 years in FY22, with

Retail Parks at 12.0 years and Core Shopping Centres at 6.9 years.

In terms of tenant incentives, due to the continued competitive

tension in the occupational market, for long-term leasing transactions

the average rent free period was broadly aligned to FY22 at just

2.8 months, a marked improvement compared to FY21 and FY20,

with many occupiers receiving no rent free period.

The demand for space that we saw in our portfolio during the year

was broadly based with 67% (FY22: 54%) of the space leased to

Grocery, Discount, F&B, Health & Beauty and Value Fashion.

Car park and commercialisation income continues its recovery from

the pandemic rebounding following a disrupted FY22, increasing

12% in the 12 months to March 2023. Overall, income is now back

up to 78% against pre-pandemic levels.

Our portfolio valuation at £593.6 million, represents a capital return

outperformance against the MSCI All Property and All Retail indices

of +1,030bps and +660bps respectively with a like-for-like valuation

movement of -5.9% for the year. The valuation movement was

centred on the Regeneration portfolio which accounted for 62%,

driven by higher estimated development costs, whilst the remainder

of the portfolio experienced marginal movements as a result of

market driven yield shifts. Out of the 45 assets within the portfolio,

10 assets experienced capital growth or a stable valuation, 18 less

than a £0.5 million decline and 10 between a £0.5-£1 million decline.

This means that 84% of our assets had limited valuation movement

underpinning the underlying resilience of our portfolio.

Strategic Report

Valuation Outperformance

+660bps

Capital return outperformance vs.

MSCI All Property and All Retail indices

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

As at 31 March 2023 (£m)

Portfolio

Weighting

(%)

Valuation

Movement H1

(%)

Valuation

Movement H2

(%)

Valuation

Movement FY

(%)

Topped-up

NIY

(%)

NEY

(%)

LFL ERY

Movement

(%)

LFL ERV

Movement

(%)

Shopping Centres – Core 219.9 37% 0.2% -0.9% -0.7% 9.6% 9.3% 0.0% -1.1%

Retail Parks 165.5 28% 0.5% -3.5% -3.2% 7.0% 7.0% 0.3% 2.7%

Shopping Centres

– Regen 140.0 23% -4.2% -10.5% -14.1% 5.9% 6.8% 0.6% 1.2%

Total excl. Work Out /

Other 525.4 88% -1.0% -4.4% -5.4% 7.9% 7.9% 0.3% 0.4%

Shopping Centres

– Work Out 63.4 11% -2.5% -5.8% -7.8% 9.4% 14.0% -0.3% -8.7%

Other 4.8 1% -5.7% -13.5% -22.6% 10.0% 9.5% 0.6% -11.3%

Total 593.6 100% -1.3% -4.7% -5.9% 8.0% 8.6% 0.2% -1.7%

The portfolio Net Initial Yield now stands at 8.0%, and has a Net Equivalent Yield of 8.6%, c.200bps higher than the MSCI All Retail Benchmark

at 5.9% and 6.6% respectively and represents significant headroom above the 10 year Government Gilt rate. This has meant our valuation

performance has been far more insulated from the impact of rising interest rates compared to the wider real estate sector.

As the table below shows, our portfolio significantly outperformed the MSCI All Retail, Shopping Centre and Retail Warehouse benchmarks on

an Income, Capital and Total Return basis during the year. Moreover, our Shopping Centres and Retail Parks have outperformed their

respective MSCI Total Return benchmark over a 3 and 5 year period.

12 months to 31 March 2023 Total Return Capital Growth Income Return

NRR Portfolio 2.3% -6.2% 9.0%

MSCI All Retail Benchmark -7.9% -12.7% 5.4%

Relative performance +1,020bps +660bps +350bps

Shopping Centres Retail Parks

Total Return: 12 months to 31 March 2023

NewRiver 1.6% 4.8%

MSCI Benchmark -5.1% -6.8%

Relative Performance +680bps +1,170bps

Total Return: Annualised 3 years to 31 March 2023

NewRiver -2.1% 8.7%

MSCI Benchmark -9.7% 5.3%

Relative Performance +760bps +340bps

Total Return: Annualised 5 years to 31 March 2023

NewRiver -3.5% 5.1%

MSCI Benchmark -11.0% -0.3%

Relative Performance +750bps +550bps

Review our 12-month, 3-year and 5-year

outperformance MSCI on page 43

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

As at 31 March 2023, Retail Parks accounted

for 28% of our portfolio, totalling 14 assets.

It has been another positive year for our Retail

Park Portfolio which at the year end was 98%

occupied with a retention rate of 100%. We

have continued to see strong occupational

and investor demand for our type of retail

parks which are predominately adjacent to

major supermarkets, benefit from free surface

car parking and are supportive of retailers’

omnichannel strategies.

Strategic Report

RETAIL PARKS

New Aldi store (unit extension

of former Next), Dewsbury

FY23 HIGHLIGHTS

• Portfolio weighting: 28%

• No. assets: 14

• NIY %: 7.0% versus MSCI Retail Warehouse NIY of 6.2%

• Average lot value: £17.2 million

• Key occupiers: B&M, TK Maxx, Halfords, Aldi

• Occupancy: 97.5%

• Retention rate: 100%

• Rent collection: 99%

• Affordable average rent: £12.49 per sq ft/£116,000 per annum

• Gross to Net Rent Ratio: 97%

• Leasing volume: 163,400 sq ft

• Leasing activity: 0.8% ahead of valuer ERV

• Average CAGR FY21-FY23: 0.6% on 12.3yr average

previous lease period

• Total Return 4.8% outperforming the MSCI Retail

Warehouses by 1,170 basis points

KEY RETAILERS

Portfolio review continued

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

26.1%

-4.2%

0.8%

FY21 FY22 FY23

13.3%

-0.6%

-1.5%

0.6%

FY21 FY22 FY23 average

98%

92%

100%

FY21 FY22 FY23

97.1%

97.6%

97.5%

FY21 FY22 FY23

Selected highlights Include:

• Barrow-in-Furness, Hollywood Retail & Leisure Park: This retail

park provides the key retail and leisure to the town with the only

Vue cinema in the catchment and benefits from an occupier line up

of Aldi, TK Maxx, Curry’s, Dunelm, McDonalds and KFC. The offer is

to be further strengthened with the introduction of Smyth Toys

having exchanged an Agreement for Lease for a 15 year term

replacing the former Bingo operator which we served our landlord

break notice on. The only remaining vacant unit is a 3,100 sq ft pod

which is under offer to a national veterinary company, which will

bring a great community use to the Retail Park.

• Cardiff, Valegate Retail Park: We completed an Agreement for

Lease with Poundland for a 27,000 sq ft store at a rent of

£270,000 pa and a 10,000 sq ft letting to Boulders, an indoor

climbing centre, at a rent of £100,000 per annum on a 15 year

lease and both transactions were in line with the valuer’s ERV. This

discount led 94,000 sq ft retail park, adjacent to a dominant Marks

& Spencer and Tesco Extra, is now fully let.

• Dewsbury, Rishworth Centre: At our fully-let retail park in

Dewsbury, we opened a brand new 19,500 sq ft store for Aldi

following the completion of extension works to the former Next

store. Aldi took a 20 year lease at an annual rent of £299,000 per

annum and have reported strong trading from the store. The park

is now fully let with Aldi joining Shoezone, Iceland, Halfords and

Pets at Home on the park.

• Dumfries, Cuckoo Bridge Retail Park: We received planning

consent and exchanged an Agreement for Lease with Food

Warehouse to create a new 12,500 sq ft food store which will

benefit from trading adjacent to a successful Tesco superstore. We

are in active discussions with a discount gym operator on the final

vacant unit which will make the park 100% let, further

strengthening this excellent supermarket, DIY and discount

anchored park.

• Inverness, Glendoe and Telford Retail Parks: Throughout the year

we have completed a number of lettings on the park, improving the

occupier line-up and increasing the WAULT. We negotiated a

surrender on the former PC World unit and simultaneously

completed leasing transactions with Bensons for Beds and Food

Warehouse on 10 year terms at a total rent of £278,000, 8% ahead

of the valuer’s ERV. We served the landlord break notice on

Poundstretcher in order to create space for Poundland and agreed

a reversionary lease with B&M, adding a further 10 years to the

term.

• Kendal, South Lakeland Retail Park: Having secured planning for

change of use, we have completed the lease to Food Warehouse

on an 11,600 sq ft store (previously let to Poundstretcher) at a rent

of £15.50 per sq ft on a 10 year lease. Food Warehouse joins an

already strong retailer line up including B&M, Pets at Home,

Halford and Currys, adjacent to a Morrisons supermarket.

• Leeds, Kirkstall Retail Park: We have agreed to construct a

drive-thru unit for Burger King with terms including a market

leading rent and 20 year term. The additional use is expected to

increase footfall, dwell time and average spend on the park which

is adjacent to a dominant Morrisons supermarket.

• Wirral, Eastham Point: We continued our successful partnership

with the Co-op in their convenience store expansion programme,

delivering a modern new 5,300 sq ft store which features

self-service checkouts and a hot food to go section too. Co-op

took a 15 year lease at a rent of £70,000 per annum. Kutchenhaus

also took a new 10 year lease for a new store and together these

lettings bring the park to 100% occupancy.

Strong leasing pricing

CAGR

-1.5%

Retention rate

100%

Occupancy

98%

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Portfolio review continued

Our Core Shopping Centres are located in the

heart of their local communities, playing a key

role to the local social and economic

prosperity of their conurbations by providing a

range of essential goods and services to local

people. Our centres are easily accessible with

short travel times supporting the wider climate

and well-being agenda.

As at 31 March 2023 our Core Shopping

Centre portfolio represented 37% of our total

portfolio value and comprises 14 core

community shopping centres with an

occupancy of 98%.

FY23 HIGHLIGHTS

• Portfolio weighting: 37%

• No. assets: 14

• NIY 9.6% versus MSCI Shopping Centre NIY of 7.5%

• Average lot value: £19.0 million

• Key occupiers: Primark, Superdrug, M&S, Poundland, Boots, Next

• Occupancy: 97.7%

• Retention rate: 90%

• Rent collection: 98%

• Affordable average rent: £13.18 per sq ft / £39,000 per annum

• Gross to Net Rent Ratio: 94%

• Leasing volume: 309,700 sq ft

• Leasing activity: 2.3% ahead of valuer ERV

• Average CAGR FY21-FY23: -0.8% on 9.9yr average previous

lease period

• Total Return 10.3% outperforming the MSCI Shopping

Centres by +1,540 basis points

KEY RETAILERS

The Avenue Shopping Centre,

Newton Mearns

CORE SHOPPING CENTRES

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

• Hastings, Priory Meadow: We completed a lease with Black

Sheep Coffee post year end on a 20 year lease term at £60,000

per annum on one of the last remaining vacancies and a new

12,000 sq ft unit for The Gym which is open 24 hours a day and is

helping contribute to enhanced footfall and supplementary spend

at the centre. The Gym took occupancy of the upper floors of a

former New Look store and a new co-working office was also

provided for the Department for Work and Pensions on the ground

floor, with both lettings in part facilitated through the recent

Government Towns Fund grant.

• Fareham, Locks Heath: We secured planning consent for

infrastructure and highways works which will facilitate the

development of up to 80 residential units on our two designated

development sites adjacent to the retail centre. Following a

positive pre-planning application for increased residential density,

the two sites are now under offer to one of the largest housing

associations in South England. The proposed development will

bring much needed new homes to this affluent borough and

additional footfall for our Waitrose anchored shopping centre. The

centre is now fully let with recent lettings completed to

Considerate Carnivore, an ethical and sustainable butcher, and

The Oaty Goat, an artisan coffee and gelato shop.

• Sheffield, The Moor: The Moor is a 28-acre estate in the heart of

Sheffield City Centre and owned within our Capital Partnership

with BRAVO. We have recently completed a lease with HSBC to

create a flagship branch on the high street which they are targeting

to be their first net-zero branch. This lease transaction was secured

on a 10 year lease 12.5% ahead of the valuer’s ERV at a rent of

£225,000 per annum.

• Market Deeping, The Deeping Centre: Post year end we received

planning consent for a new 20,000 sq ft discount food store, which

will provide a boost to the wider town centre and an attractive

capital return for NewRiver on completion of the development.

Selected highlights Include:

• Newtownabbey, Abbey Centre: Our 320,000 sq ft centre in

Belfast anchored by Primark, Next and Dunnes Stores provides a

clear illustration of the consistent occupational demand for a

fit-for-purpose community shopping centre. Post year end we

signed an Agreement for Lease with Danske Bank to upsize within

the centre on a 10 year term increasing the rent payable by 59%

and plan to extend the centre to create a new external unit for

Greggs. Throughout the year, we have also completed a series of

upsizes, lease renewals and new lettings to Specsavers, Bon

Marche, Pandora, Costa and The Perfume Shop.

• Newton Mearns, The Avenue: We have seen continuously strong

retailer performance at the centre demonstrated by the upsize of

Greggs and commitment to a further 15 years and lease renewals

completed with Costa, Waterstones and Holland & Barrett. The

centre benefits from its affluent catchment in the suburbs of

Glasgow and Marks & Spencer and Asda anchors.

• Skegness, The Hildreds: JD Sports have completed the upsize

from their existing unit to take full advantage of the significant

demand at the centre, increasing the rent payable by JD Sports by

28%. Shoe Zone have also upsized from 2,700 sq ft to 4,300 sq ft

paying a rent of £65,000 per annum on a lease term of five years.

Two new national retailers have been introduced to the centre,

with Pavers and The Original Factory committing to the centre on

10 year leases.

10%

0.4%

2.3%

FY21 FY22 FY23

Strong leasing pricing

-0.8%

FY21 FY22 FY23

-0.9%

-1%

average

CAGR

88%

89%

90%

FY21 FY22 FY23

Retention rate

90%

96.5%

96.6%

97.7%

FY21 FY22 FY23

Occupancy

98%

CORE SHOPPING CENTRES

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Portfolio review continued

WORK OUT

Our Work Out portfolio represents 11% of our portfolio and comprises

assets which we intend to dispose of or complete turnaround

strategies for. Since the Half Year, we have completed the disposals of

shopping centres in both Wakefield and Darlington, with the remaining

sales and turnaround strategies to be completed by the end of FY24.

The key turnaround strategies include:

• Cardiff, Capitol Shopping Centre: We are planning the wholesale

repositioning of the asset to competitive and social leisure with an

enhanced F&B provision. The Capitol Shopping Centre sits

alongside the Council’s major upgrade to the wider area which will

improve the infrastructure and public realm, including reinstating a

stretch of canal next to the Centre’s entrance, and is due to

complete in the Autumn 2023. We are in advanced discussion with

a national competitive and social leisure operator to occupy circa

115,000 sq ft of the centre which will be the catalyst for the Food &

Beverage lettings on the remainder of the centre.

• Kilmarnock, Burns Mall: We are working collaboratively with the

Council on plans to demolish the former BHS to create a surface car

park to be let to the Council on a long-term lease and upsize key

occupiers within the centre. We are confident that the removal of

surplus retail, improvement in public realm and accessibility will

revitalise the centre. The works are to be part funded by the Council.

• Paisley, The Piazza: The centre is the principal retail offering within

the town centre and has strengthened following the planned

re-development of the neighbouring weaker shopping centre

within the catchment, therefore removing significant surplus retail

supply from the town. The strategy has been focused on renewed

letting activity and deals have now completed with JD Sports on a

10 year lease at £65,000 per annum which is line with the valuer’s

ERV, previously let on a temporary basis; and we are in legals with

Poundland to upsize into a currently vacant unit. In total the lettings

cover 30,000 sq ft and bring the centre to near fully occupied.

• Wallsend, The Forum: We are in the final stages of the turnaround

strategy for this community shopping centre just outside Newcastle.

The new medical centre which was built on surplus car park space is

now open, sitting alongside Aldi and Burger King which we developed

in 2016 and we have received planning consent to remove surplus

retail space and make public realm improvements. This will improve

the connectivity between the Aldi, the health centre and the retail

centre whilst facilitating potential development opportunities on the

surplus car park for residential or drive-thru units.

• Wisbech, Horsefair: Following a positive pre-application response

we are moving forward with our redevelopment strategy for the

delivery of a new 20,000 sq ft food store anchor with a new

surface car park. Once we have agreed terms to pre-let the new

store we will submit a planning application for which following the

pre-application, we are confident of securing and on delivery of the

food store the centre will be fully let and help boost footfall to the

centre and town.

Proposed foodstore at

The Horsefair, Wisbech

on surplus car parking

FY23 HIGHLIGHTS

• Portfolio weighting: 11%

• No. assets: 9

• NIY %: 9.4% versus MSCI Shopping Centre NIY of 7.5%

• Average lot value: £7.0 million

• Key occupiers: Poundland, Iceland, Home Bargains, Tesco

• Occupancy: 92.8%

• Retention rate: 89%

• Rent collection: 97%

• Affordable average rent: £9.13 per sq ft / £23,000 per annum

• Gross to Net Rent Ratio: 65%

• Leasing volume: 338,800 sq ft

• Leasing activity: -2.1% below valuer ERV

• Average CAGR FY21-FY23: -0.4% on 6.7yr average previous

lease period

• Total Return 0.7% outperforming the MSCI Shopping

Centres by 590 basis points

KEY RETAILERS

Work Out Portfolio Strategy

(% of valuation)

Turnaround

Planned disposals

30%

70%

Completed

Disposals

2 x assets

£17m

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

REGENERATION

Broadway Shopping Centre,

Bexleyheath

FY23 HIGHLIGHTS

• Portfolio weighting: 23%

• No. assets: 3

• NIY %: 5.9% versus MSCI Shopping Centre NIY of 7.5%:

• Average lot value: £46.7 million

• Key occupiers: Sainsbury’s, M&S, Wilko, Boots, H&M, WH Smith

• Occupancy: 97.4%

• Retention rate: 97%

• Rent collection: 100%

• Gross to Net Rent Ratio: 86%

• Leasing volume: 138,700 sq ft

• Leasing activity: -3.9% ahead of valuer ERV

• Average CAGR FY21-FY23: -0.7% on 9.4yr average

previous lease period

• Total Return -9.4% underperforming the MSCI

Shopping Centres by -420 basis points

KEY RETAILERS

We have three regeneration assets, representing 23% of the total

portfolio value where the strategy is to deliver capital growth through

redeveloping surplus retail space predominantly for residential.

• Grays, Grays Shopping Centre: We are making good progress on

proposals to redevelop the shopping centre for a high-density

residential-led redevelopment of up to 850+ homes, located just

35 minutes from central London by train. Following a successful

Design Review Panel programme, we completed an intensive

stakeholder engagement programme during the year, meeting

with local community groups and the local authority. Preparations

are at an advanced stage, and we intend to submit the outline

planning application in mid-2023.

• Bexleyheath, Broadway Shopping Centre: This Greater London

asset, comprising a Shopping Centre and integrated retail park,

presents a significant opportunity to generate capital growth through

maintaining the existing dominant retail core whilst delivering new

residential development across this 11 acre site. As part of our strategic

masterplan, a number of research reports were commissioned to

guide our overall strategy and to enable the first phase which would

provide 350 new homes and we are working collaboratively with the

Council to unlock this potential. The existing centre continues to trade

well and through the year we completed 18 leasing events, including

11 renewals and seven new lettings including Starbucks, H&M, Bakers

and Baristas, Krispy Kreme, Laser Clinic and HMV.

• Burgess Hill, The Martlets: The site currently benefits from a

planning consent for a mixed-use development including

residential units, a food store, hotel and expansion of the car park

with terms agreed with a food operator and a pre-let agreed with

Travelodge on the hotel. The site with detailed planning consent

for 187 residential units is being prepared for sale and we will focus

on delivering the wider retail and leisure elements.

Pipeline of

residentialunits

+1,700

units

Repurposed retail

spaceproposed

3 x assets

+150k

sq ft

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Our platform

AGILE

PLATFORM

As the leading UK retail real estate company

weown, manage and develop resilient retail

assets across the UK both on our own balance

sheet and on behalf of our capital partners.

Weunderstand what makes a resilient retail

asset and know how to deliver attractive

longterm returns whilst helping create

thrivingcommunities.

RESILIENT RETAIL

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

+550bps

+750bps

+480bps

+490bps

+40bps

+250bps

Income ReturnCapital GrowthTotal Return

5 year

Our Portfolio

We specialise in owning, managing and developing resilient retail

assets throughout the UK and have hand-picked our 7 million sq ft

portfolio of community shopping centres and conveniently located

retail parks, which are occupied by tenants predominately focused on

essential goods and services compatible to omni-channel retailing.

We actively manage assets on our own balance sheet and also

assets on behalf of our capital partners in order to deliver long-term

attractive recurring income returns and capital growth for our

shareholders as well as helping create thriving communities.

Market Leading Platform

We draw on our in-house expertise, our deep understanding of our

market and our excellent occupier relationships to enhance and

protect income returns through our active asset management and

development strategy, underpinned by a data-driven approach

Activities include:

• Deployment of targeted capex to improve asset environments and

shopper experience

• Enhancing occupier type and mix

• Proactive measures to reduce costs for occupiers

• Implementation of ESG strategies including a supplier ESG

performance evaluation process and a quarterly ESG performance

review for our Property team; and on-site ESG training

• Generating incremental income through commercialisation

and car parking

• Small scale development projects

• Master-planning large scale town centre regeneration projects

Track Record: Operational Resilience

We have a track record of delivering resilient portfolio-wide

operational metrics. Our team had another active and successful

year executing a range of asset management initiatives which are

designed to improve the underlying quality of our rental cashflows

and to deliver capital growth.

Retail parks Shopping Centres

Accredited Asset Management and

Development Approach

Ranked 1

place in the GRESB Management module

out of 901 participants across Europe; achieved an

‘A’ alignment rating in GRESB’s independent TCFD

assessment; achieved 90/100 score in the GRESB

Development benchmark

Retained Gold Award in EPRA Sustainability Best

Practice Recommendations Awards

Retained ‘B’ Rating from the CDP for our

management of climate-related issues

+340bps

+760bps

+270bps

+490bps

+50bps

+270bps

Income ReturnCapital GrowthTotal Return

3 year

+1170bps

+680bps

+960bps

+360bps

+160bps

+320bps

Income ReturnCapital GrowthTotal Return

1 year

NewRiver Outperformance vs MSCI Benchmark

FY23 OPERATIONAL HIGHLIGHTS

• 96.7% occupancy

• 98% rent collection

• 92% retention rate

• £11.98 affordable average rent

• +1.1% strong leasing pricing vs ERV

• 980,000 sq ft of leasing transactions, securing

£7.9 million of annualised income

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Capital Partnerships are an important

part of our business, contributing to

overall earnings growth, by allowing us

to acquire assets in a capital light way

and receive proportional rental income.

They are also a means of enhancing our

returns from asset management fees

with the potential to receive financial

promotes linked to performance.

Growing Our Capital Partnerships

As well as managing assets on our own balance sheet, we also

actively manage assets on behalf of our capital partners by

leveraging our market leading asset management platform

across three sectors: private equity, institutional investors

and local authorities.

During the year we expanded our Capital Partnerships by

securing a high-quality mandate from M&G Real Estate to asset

manage a large retail portfolio, including 16 retail parks and one

shopping centre with an additional south-east shopping centre

added to this mandate subsequent to our appointment in

November 2022.

Capital Partnerships are an important part of our business,

delivering earnings growth in a capital light way through asset

management fees, a share of rent and the potential to receive

financial promotes. We currently asset manage 19 retail parks

and five shopping centres across 5 million sq ft.

The expansion and breadth of our Capital Partnerships is a

clear indication of the need for specialist retail partners with

a best-in-class asset management platform to enhance

performance in the highly operational retail sector and we

see this a as key area of strategic expansion to help provide

us with the opportunity to deliver future earnings growth.

Leveraging our platform

throughcapital partnerships

Our Capital Partnerships continue to

grow and in November 2022 we secured

a high-quality mandate from M&G Real

Estate to asset manage a large retail

portfolio, with an additional south-east

shopping centre added to this mandate

since the appointment. The portfolio

currently comprises 16 retail parks and

two shopping centres.

PARTNERSHIP WITH M&G

Our Capital Partnerships by area and number

Strategic report

Our platform continued

Strategic Report

5 shopping centres

19 retail parks

sq ft

20%80%

5 shopping centres

19 retail parks

sq ft

20%80%

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic ReportStrategic reportStrategic Report

Advancing our Capital Partnerships

Our market leading asset management platform is leveraged through

capital partnerships in three sectors:

Festival Retail Park, Hanley,

Stoke-on-Trent (M&G)

with M&G Real Estate

across two shopping centres

and 16 retail parks

with Canterbury City Council

across two shopping centres

in Canterbury.

with BRAVO for three retail

parks and one shopping

centre in Sheffield

retail

parks

shopping

centre

shopping

centres

shopping

centres

16x

retail

parks

Key highlights:

• We have completed 18 long-term leasing

transactions across 65,600 sq ft, securing

£1.5 million of rent

• We have been appointed as Development

Manager for the Council to repurpose

surplus retail space into office

accommodation to facilitate the re-location

of the council offices into Whitefriars

Shopping Centre.

Key highlights:

• At The Moor, Sheffield we have completed

a lease with HSBC to create a flagship

branch on the high street which they are

targeting to be their first net-zero branch

• At Sprucefield Retail Park, Northern Ireland

we have received planning consent,

post-period, for three drive-thru units

across 9,800 sq ft with terms agreed with

operators on each unit

• At Telford Retail Park, Inverness we

negotiated a surrender on the former PC

World unit and simultaneously completed

leasing transactions with Bensons for Beds

and Food Warehouse.

Key highlights:

• Following our appointment in November

2022, the mandate was expanded to

include an additional south-east shopping

centre post-period in April 2023

• We have successfully onboarded and

embedded the portfolio within our day to

day operations. In the first full quarter, we

have completed 120,000 sq ft of leasing

transactions securing £2 million of rent.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

PRIVATE

EQUITY

LOCAL

AUTHORITIES

INSTITUTIONAL

SECTOR

STRONG

FINANCIAL

POSITION

Will Hobman

Chief Financial Officer

“Despite the macro-economic

headwinds faced, particularly

in the second half of the year,

by continuing to deliver our

strategic objectives and due

to the strength of our asset

management platform,

wehave managed to

maintain and even

enhancethe strength

ofourfinancial position.”

RESILIENT RETAIL

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Finance review

Despite the macro-economic headwinds faced, particularly in

thesecond half of the year, by continuing to deliver our strategic

objectives and due to the strength of our asset management

platform, we have managed to maintain and even enhance the

strength of our financial position while sustaining the operational

momentum that has built over the last two years.

The strength of our financial position remains crucially important

inthe current economic environment, and the steps we took in the

prioryear, together with the successful delivery of our target Work

Out disposals and the progress we have made in reducing costs as

well as the close monitoring of capital expenditure during FY23 are

evident in our improved LTV position which was 33.9% at 31 March

2023, reduced from 34.1% in March 2022 and 50.6% in March 2021.

This has been achieved by reducing absolute levels of net debt

(from£493.3 million in March 2021 to £201.3 million in March 2023)

as opposed to benefitting from yield compression in our property

portfolio. The strength of our financial position extends beyond LTV

and encompasses other measures, including Interest cover which

has improved from 3.5x in FY22, to 4.3x and Net debt: EBITDA

whichremains low and a key strength for NewRiver, at 4.9x.

Underlying Funds From Operations (‘UFFO’), now on a retail only

basis following the disposal of the Hawthorn pub business in August

2021, increased to £25.8 million from £20.5 million from the retail

business in FY22 which reflects the continued recovery in our

underlying operations and the successful implementation of our

finance and administrative cost reduction initiatives. Our dividend

policy is linked directly to UFFO, and having declared an interim

dividend of 3.5 pence in November 2022, the Board is pleased to

declare a final dividend relating to the second half of the financial

year of 3.2 pence per share. This brings the total FY23 dividend

to6.7 pence, representing 80% of UFFO per share of 8.3 pence.

IFRSloss after tax for FY23 was £16.8 million including a non-cash

reduction in portfolio valuation of £37.4 million, improved from the

prior year (FY22: loss of £26.6 million) which included the one-off

impact of the loss on disposal of the Hawthorn pub business.

Our property portfolio was valued on a proportionally

consolidatedbasis at £593.6 million as at 31 March 2023,

comparedto £649.4 million as at 31 March 2022, due to the

successful deliveryofour disposal target and a 5.9% portfolio

valuation decline. Themajority of the valuation decline, 4.7% of the

total 5.9%, came in the second half of the year and was focused on

our Regeneration portfolio due to the impact of inflation on estimated

construction and finance costs. Importantly, the capital decline seen

in our portfolio represents a significant outperformance to both the

MSCI All Property (-16%) and All Retail (-13%) indices. The portfolio

valuation decline is reflected in the reduction in EPRA Net Tangible

Assets per share from 134 pence at 31 March 2022 to 121 pence at

31 March 2023. We delivered a total accounting return of -4.6%

during FY23, impacted by the portfolio valuation decline noted

above, compared with -6.6% in the prior year.

Key performance measures

The Group financial statements are prepared under IFRS, where the

Group’s interests in joint ventures are shown as a single line item on

the income statement and balance sheet. Management reviews the

performance of the business principally on a proportionally

consolidated basis which includes the Group’s share of joint

ventureson a line-by-line basis. The Group’s financial key

performance indicators are presented on this basis.

OUR HIGHLIGHTS

Retail Underlying

FundsFrom Operations

£25.8m

FY22: £20.5m

LTV

33.9%

FY22: 34.1%

Retail UFFO

Per Share

8.3p

FY22: 6.7p

Ordinary Dividend

Per Share

6.7p

FY22: 7.4p

IFRS Loss After Tax

£(16.8)m

FY22: £(26.6)m

Admin cost ratio

15.2%

FY22: 16.9%

Total Accounting Return

-4.6%

FY22: -6.6%

Net finance costs

£14.9m

FY22: £19.5m

Net debt

£201.3m

FY22: £221.5m

Interest cover

4.3x

FY22: 3.5x

Weighted average

debt maturity

4.7 yrs

FY22: 5.7 yrs

Net debt: EBITDA

4.9x

FY22: 4.6x

1. Due to sale of Hawthorn pub business in August 2021

2. Drawn debt only

Key

Performance versus previous year

Improved Declined Maintained

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

In addition to information contained in the Group financial statements,

Alternative Performance Measures (‘APMs’), being financial measures

that are not specified under IFRS, are also used by management to

assess the Group’s performance. These APMs include a number of

European Public Real Estate Association (‘EPRA’) measures, prepared

in accordance with the EPRA Best Practice Recommendations

reporting framework, which are summarised in the ‘Alternative

Performance Measures’ section at the end of this document. We report

these measures because management considersthem to improve the

transparency and relevance of our published results as well as the

comparability with other listed European real estate companies.

Definitions for APMs are included inthe glossary and the most directly

comparable IFRS measure is alsoidentified. The measures used in the

review below are all APMs presented on a proportionally consolidated

basis unless otherwise stated.

The APM on which management places most focus, reflecting

theCompany’s commitment to driving income returns, is UFFO.

UFFOmeasures the Company’s operational profits, which includes

other income and excludes one off or non-cash adjustments, such

asportfolio valuation movements, profits or losses on the disposal

ofinvestment properties, fair value movements on derivatives and

share-based payment expense. We consider this metric to be the

most appropriate for measuring the underlying performance of the

business as it is familiar to non-property investors, and better reflects

the Company’s generation of profits. It is for this reason that UFFO is

used to measure dividend cover.

The relevant sections of this Finance Review contain supporting

information, including reconciliations to the financial statements and

IFRS measures. The ‘Alternative Performance Measures’ section also

provides references to where reconciliations can be found between

APMs and IFRS measures.

Reconciliation of (loss) / profit after taxation to UFFO

31 March 2023 31 March 2022

Retail

£m

Hawthorn

£m

Total

£m

Retail

£m

Hawthorn

£m

Total

£m

(Loss) / profit for the year after taxation (16.8) – (16.8) 7.0 (33.6) (26.6)

Adjustments

Revaluation of property 38.2 – 38.2 12.3 – 12.3

Revaluation of joint ventures’ and associates’ investment

properties (0.8) – (0.8) (5.8) – (5.8)

Loss / (profit) on disposal of investment properties 3.8 – 3.8 5.4 (0.8) 4.6

Changes in fair value of financial instruments and associated close

out costs (0.2) – (0.2) (0.6) – (0.6)

Loss on disposal of subsidiary – – – – 39.7 39.7

Deferred tax 0.2 – 0.2 0.6 1.9 2.5

EPRA earnings 24.4 24.4 18.9 7.2 26.1

Depreciation of property – – – – 0.4 0.4

Forward looking element of IFRS 9 (0.2) – (0.2) (0.2) – (0.2)

Abortive fees – – – – 0.2 0.2

Restructuring costs

– – – 0.9 – 0.9

Head office relocation costs 0.5 – 0.5 – – –

Share-based payment charge 1.1 – 1.1 0.9 – 0.9

Underlying Funds From Operations 25.8 – 25.8 20.5 7.8 28.3

1. Pubs operating performance from 1 April 2021 to 20 August 2021 when the disposal of the Hawthorn business was completed. Disclosed as “discontinued

operations” in the consolidated statement of comprehensive income

2. During the prior year the Group incurred restructuring costs in relation to employee related matters following the sale of Hawthorn

Underlying Funds From Operations

The following table reconciles IFRS (loss) / profit after taxation to UFFO, which is the Company’s measure of underlying operational profits.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Finance review continued

Underlying Funds From Operations is represented on a proportionally consolidated basis in the following table. The UFFO commentary that

follows is focused on the continuing retail business. The £7.8 million “Contribution from Hawthorn” in the prior year (discontinued operation)

was analysed in detail in the HY22 and FY22 results materials.

31 March 2023 31 March 2022

Underlying funds from operations

Group

£m

JVs &

Associates

£m

Adjustments

£m

Proportionally

consolidated

£m

Proportionally

consolidated

£m

Revenue 72.2 4.0 – 76.2 77.7

Property operating expenses (25.1) (0.4) (0.2) (25.7) (25.9)

Net property income 47.1 3.6 (0.2) 50.5 51.8

Administrative expenses (12.6) (0.1) 1.6 (11.1) (11.7)

Other income 1.4 – – 1.4 –

Operating profit 35.9 3.5 1.4 40.8 40.1

Net finance costs (14.0) (0.7) (0.2) (14.9) (19.5)

Taxation – (0.3) 0.2 (0.1) (0.1)

Retail UFFO 21.9 2.5 1.4 25.8 20.5

Contribution from Hawthorn

– 7.8

Underlying Funds From Operations 25.8 28.3

UFFO per share (pence) 8.3 9.2

Ordinary dividend per share (pence) 6.7 7.4

Ordinary dividend cover 125% 125%

Admin cost ratio

15.2% 16.9%

Weighted average # shares (m) 309.7 307.2

1. Adjustments to Group and JV & Associates figures to remove non-cash and non-recurring items, principally forward looking element of IFRS 9 £0.2 million,

share-based payment charge £(1.1) million, head office relocation costs £(0.5) million, revaluation of derivatives £0.2 million and deferred tax of £(0.2) million

2. UFFO contribution from the Hawthorn business in FY22 prior to its disposal on 20 August 2021

3. Includes Hawthorn in FY22

Net property income

Analysis of retail net property income (£m)

Retail net property income for the year ended 31 March 2022 51.8

Like-for-like rental income 1.2

Rent and service charge provisions 0.2

Car park and commercialisation income 1.3

Other (0.3)

Retail NRI recovery 2.4

Net disposals (3.7)

Retail net property income for the year ended 31 March 2023 50.5

On a proportionally consolidated basis, retail net property income was £50.5 million during the year, compared to £51.8 million in the year

ended 31 March 2022. Net disposal activity during FY22 and FY23 reduced net property income by £3.7 million such that on an underlying

basis there has been an increase of £2.4 million from the recovery of net property income post pandemic (“Retail NRI recovery”).

One of the key contributory factors to this recovery is the increase in like-for-like net property income of £1.2 million during the year, primarily

due to new lettings and improved rental levels on space which had previously been occupied by tenants who were in Administration or had

been impacted by CVAs, including the receipt of turnover rent.

Rent and service charge provisions have also continued to improve year-on-year, by £0.2 million, over and above the strong performance in this

regard seen in FY22, when we reported an improvement of £4.9 million for the year. This serves to highlight the continued resilience of our rent

collection, as not only have we been able to broadly maintain the high collection levels of historical arrears as in FY22, but we are also carrying a

lower level of provisioning compared to the prior year, with rent collection rates of 98% having now recovered back to pre-pandemic levels.

Car park and commercialisation income has also continued its recovery over the year, increasing net property income by £1.3 million, which

represents an improvement of 12% on the year ended 31 March 2022 and means that it is now back up to 78% of pre-Covid levels.

We completed £23.0 million of disposals during FY23, primarily relating to the strategic disposal of two of our Work Out assets in Q4 FY23, on

top of the £77.1 million completed in FY22, the majority of which were completed during the second half of the year and which were therefore

the main cause of the £3.7 million decrease in net property income from net disposal activity.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Administrative expenses

Administrative expenses were £11.1 million in the year ended

31 March 2023, decreasing by 5% when compared to £11.7 million

forthe previous year and 8% when compared to £12.0 million in the

year ended 31 March 2021. This reduction reflects the benefit of cost

efficiencies unlocked across the business over the last 18 months

following the extensive review of our cost base completed during

thefirst half of FY22. During the first half of this year we completed

our head office relocation, which has resulted in £0.5 million of

administrative cost savings per annum. Looking ahead, we have

atarget to continue to reduce our administrative expenses in

FY24andbeyond.

Other income

Other income recognised during the year ended 31 March 2023 of

£1.4 million compared to £nil in the prior year. The income recognised

relates entirely to the settlement of an income disruption insurance

claim relating to our car park income during the first Covid lockdown

between March and June 2020. A more modest claim relating to our

commercialisation and turnover rent income during the same period

remains ongoing and is not reflected in the results for the year.

Net finance costs

Net finance costs were £14.9 million in the year to 31 March 2023,

compared to £19.5 million in the year to 31 March 2022. The principal

reason for the reduction was the repayment of £170 million of RCF and

cancellation of £165 million of term loan and associated swaps during

the first six months of the prior year following the disposal of the

Hawthorn pub business. These actions unlocked a finance cost saving

of £7 million per annum, with £3.5 million of benefit recognised in the

second half of FY22, and the remaining £3.5 million in the first half of

FY23. The balance of the year on year reduction relates to finance

income we have generated in the second half of FY23 through

maximising the returns on our surplus cash reserves by placing

themon deposit, whilst at the same time our cost of drawn debt has

remained insulated from the market volatility, being fixed until 2028.

Taxation

As a REIT we are exempt from UK corporation tax in respect of our

qualifying UK property rental income and gains arising from direct

and indirect disposals of exempt property assets. The majority of the

Group’s income is therefore tax free as a result of its REIT status,

albeit this exemption does not extend to other sources of income

such as interest or asset management fees.

Dividends

Under our dividend policy, we declare dividends equivalent to

80%ofUFFO twice annually at the Company’s half and full year

results, calculated with reference to the most recently completed

six-month period.

The Company is a member of the REIT regime whereby profits from

its UK property rental business are tax exempt. The REIT regime only

applies to certain property-related profits and has several criteria

which have to be met, including that at least 90% of our profit from

the property rental business must be paid as dividends. We intend to

continue as a REIT for the foreseeable future, and therefore the policy

allows the final dividend to be “topped-up”, including where required

to ensure REIT compliance, such that the blended payout in any

financial year may be higher than 80%.

In-line with this policy, in November 2022 the Board declared an

interim dividend of 3.5 pence per share in respect of the six months

ended 30 September 2022, based on 80% of UFFO per share of

4.4pence. The Board has today declared a final dividend of 3.2 pence

per share in respect of the year ended 31 March 2023, taking the total

FY23 dividend declared to 6.7 pence, equivalent to 80% of UFFO

pershare of 8.3 pence. The final dividend of 3.2 pence per share in

respect of the year ended 31 March 2023 will, subject to shareholder

approval at the 2023 AGM, be paid on 4 August 2023 toshareholders

on the register as at 16 June 2023 (record date). The dividend will be

payable as a REIT Property Income Distribution (PID).

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Finance review continued

Balance sheet

EPRA net tangible assets (‘EPRA NTA’) include a number of adjustments to the IFRS reported net assets and both measures are presented

below on a proportionally consolidated basis.

As at 31 March 2023 As at 31 March 2022

Group

£m

JVs &

Associates

£m

Proportionally

consolidated

£m

Proportionally

consolidated

£m

Properties at valuation

551.5 42.1 593.6 649.4

Right of use asset 76.7 – 76.7 75.7

Investment in JVs & associates 29.3 (29.3) – –

Other non–current assets 0.4 1.5 1.9 2.2

Cash 108.6 2.7 111.3 88.2

Other current assets 15.0 0.9 15.9 19.6

Total assets 781.5 17.9 799.4 835.1

Other current liabilities (29.5) (1.1) (30.6) (34.9)

Lease liability (76.7) – (76.7) (75.7)

Borrowings

(296.7) (15.9) (312.6) (309.7)

Other non–current liabilities – (0.9) (0.9) (0.7)

Total liabilities (402.9) (17.9) (420.8) (421.0)

IFRS net assets 378.6 – 378.6 414.1

EPRA adjustments:

Deferred tax 0.9 0.6

Fair value financial instruments (0.6) (0.3)

EPRA NTA 378.9 414.4

EPRA NTA per share 121p 134p

IFRS net assets per share 122p 135p

LTV 33.9% 34.1%

1. See Note 14 for a reconciliation between Properties at valuation and categorisation per Consolidated balance sheet

2. Principal value of gross debt, less unamortised fees

Net assets

As at 31 March 2023, IFRS net assets were £378.6 million, reducing from £414.1 million at 31 March 2022 primarily due to the like-for-like

decrease in our property portfolio valuation, the majority of which (4.7% of the total 5.9% decline) occurred during the second half of the year

reflecting the disruption seen in the credit and investment markets in the final quarter of 2022, and the capital decline seen in our portfolio

represents a significant outperformance to both the MSCI All Property (-16%) and All Retail (-13%) indices.

EPRA NTA is calculated by adjusting net assets to reflect the potential impact of dilutive ordinary shares, and to remove the fair value of any

derivatives, deferred tax and goodwill held on the balance sheet. These adjustments are made with the aim of improving comparability with

other European real estate companies. EPRA NTA decreased by 8.6% to £378.9 million, from £414.4 million at 31 March 2022 due to the -5.9%

like-for-like decrease in portfolio valuation noted above. EPRA NTA per share decreased to 121 pence from 134 pence at 31 March 2023 for the

same reason.

Properties at valuation

Properties at valuation decreased by £55.7 million during the year, due to the £23.0 million of disposals made throughout the second half of the

year, as well as the valuation decline of 5.9% explained above.

Of the £23.0 million of disposals made in the year, £17.3 million related to our Work Out shopping centre portfolio, which have reduced from

14% of the portfolio as at 31 March 2022 to 11% as at 31 March 2023. We have a target to complete our exit from the Work Out portfolio by the

end of FY24.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Debt & financing

Proportionally consolidated

31 March 2023 30 September 2022 31 March 2022

Weighted average cost of debt – drawn only

3.5% 3.5% 3.4%

Weighted average debt maturity – drawn only

4.7 yrs 5.2 yrs 5.7 yrs

Weighted average debt maturity – total

3.8 yrs 4.3 yrs 4.8 yrs

1. Weighted average cost of debt and weighted average debt maturity on drawn debt only

2. Weighted average debt maturity on total debt, including £125 million undrawn RCF

Our weighted average cost of debt has remained stable throughout the financial year, increasing by 0.1% from 3.4% at 31 March 2022 to 3.5%

at 31 March 2023 due to the arrangement of a new secured bilateral facility on The Moor in Sheffield in April 2022 which is held in our Capital

Partnership with BRAVO. On a drawn basis, weighted average debt maturity decreased from 5.7 to 4.7 years, tracking the tenor of our

unsecured bond which matures in March 2028 and now constitutes a larger proportion of our debt structure following the debt restructuring

completed during the prior year. Importantly in the current interest rate environment, the coupon on the unsecured bond is fixed at 3.5%.

Proportionally consolidated

31 March 2023

£m

30 September 2022

£m

31 March 2022

£m

Cash 111.3 95.1 88.2

Principal value of gross debt (316.0) (316.0) (314.0)

Net debt

(201.3) (217.1) (221.5)

Drawn RCF – – –

Total liquidity

236.3 220.1 213.2

Gross debt (drawn) / repaid in the year / period (2.0) (2.0) 339.1

Loan to Value 33.9% 33.8% 34.1%

1. Including unamortised arrangement fees

2. Cash and undrawn RCF

Financial policies

We have five financial policies in total, including LTV and Interest cover which also appear as debt covenants on our unsecured RCF and our

bond. These remain a key component of our financial risk management strategy which remains as important as ever given the macro-economic

climate. For the year ended 31 March 2023, we were in compliance with all of our financial policies.

Measure Financial policy Proportionally consolidated

31 March 2023 30 September 2022 31 March 2022

Loan to value

Guidance <40%

Policy <50% 33.9% 33.8% 34.1%

Group

31 March 2023 30 September 2022 31 March 2022

Balance sheet gearing <100% 49.7% 49.8% 51.5%

Proportionally consolidated

FY23 HY23 FY22

Net debt: EBITDA <10x 4.9x 5.1x 4.6x

Interest cover

>2.0x 4.3x 3.9x 3.5x

Ordinary dividend cover

>100% 125% 125% 125%

1. 12 month look-back calculation, consistent with debt covenant

2. Calculated with reference to UFFO

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Finance review continued

LTV has remained stable at 33.9% as at 31 March 2023, reducing from 34.1% as at 31 March 2022 and comfortably within our guidance of <40%.

We are committed to maintaining a conservative LTV position and given the current macro-economic outlook we will not rush to redeploy to the

40% level. Instead, we intend to retain some headroom to this level in the near-term along with excess cash in the bank which together give us

maximum optionality.

Balance sheet gearing has reduced by 1.8% from 51.5% at 31 March 2022 to 49.7% at 31 March 2023, comfortably within our policy. Net debt:

EBITDA, which is a key strength for NewRiver relative to the listed peer group due to our high yielding portfolio, has improved half on half

during the year, reducing from 5.1x at the half year to 4.9x at 31 March 2023. This is a slight increase from the 4.6x seen in FY22 due to the

EBITDA we received in FY22 from the Hawthorn pub business prior to its disposal in August 2021.

Our interest cover ratio, which is increasingly important given the current interest rate environment, increased by 0.8x from 3.5x at 31 March

2022 to 4.3x at 31 March 2023 and therefore has significant headroom to our policy of 2.0x. This increase is due to the actions we completed in

the prior year being the disposal of the Hawthorn pub business and the subsequent debt reduction, alongside the continued improvement in

our underlying retail operations and the cash return we are currently able to generate by placing our surplus cash on deposit. Importantly,

because our cost of drawn debt is fixed at 3.5% until March 2028, our interest cover is protected from the volatility in the broader credit markets

and with retail income still recovering post-pandemic is well positioned looking forward.

The Board has declared a final dividend of 3.2 pence per share, which brings the total dividend declared for the year to 6.7 pence per share, which

represents 80% of UFFO per our dividend policy, which ensures that our dividend will always be fully covered, in-line with our financial policy.

Additional guidelines

Alongside our financial policies we have a number of additional guidelines used by management to analyse operational and financial risk,

which we disclose in the following table:

Guideline 31 March 2023

Single retailer concentration <5% of gross income 3.4% (Poundland)

Development expenditure <10% of GAV <1%

Risk-controlled development >70% pre-let or pre-sold on committed N/A, no developments on site

Conclusion

Against a challenging backdrop, what is pleasing is that operationally the business continued to perform well throughout the year and we

believe we have ended the year in a stronger financial position than at the start. This is thanks to the decisive actions completed during FY22

and the strategic progress we have made during FY23, which means we are now a leaner and more conservatively positioned business, with a

clear focus on resilient retail which provides essential non-discretionary goods and services to consumers across the UK. It is also due to the

decision we made a year ago to hold back on capital redeployment given the level of macroeconomic uncertainty that existed at the time, and

has prevailed throughout the year.

Looking forward from a position of financial strength and with the continued recovery in our underlying operations, we remain confident in our

ability to deliver our medium term target of a consistent 10% total accounting return.

Will Hobman

Chief Financial Officer

14 June 2023

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Advancing our approach to

responsible real estate ownership

We continue to make great

progress on our ESG Strategy,

further embedding this vital

commitment across the

business, to fulfil our targets and

help protect our people, planet

and environment.

I am delighted to say that this year the various

initiatives we implemented that were designed

to enable NewRiver to have a positive impact on

the communities and local environments in

which our assets are located have been

recognised by industry bodies and benchmarks.

However we remain live to the challenges on a

wider scale, to both our industry and society, and

yet despite these challenges, I am pleased to

highlight the key areas of progress including

ESG integration across our business, advancing

steps on our Pathway to Net-Zero and the

consequential improvement in our

benchmarking.

Our assets are part of the fabric of the built

environment and we have a duty to protect,

enhance, and minimise our impact, so we are

immensely proud of the work that our team has

achieved this year to ensure we continue to be a

responsible real estate owner.

Emma Mackenzie

Head of Asset Management and ESG

Our ESG Journey through to 2022

Formalised our four ESG objectives and established an

official programme of engagement and improvement

2015

ESG considerations embedded into our business

model and targets set against our ESG priorities

2016

EPC Assessment roll-out and MEES risk exposure review.

Established data management programme and initiated

AMR and LED lighting rollout

2017

Energy and GHG emission targets set, installed 18

InstaVolt electric charging points, launched sustainable

occupier fit-out guide and green lease clauses,

established our well-being programme

2018

Embedded ESG risks into our corporate risk management

and governance practices, established our first corporate

charity partnershipwith the Trussell Trust, fitted solarPVs

to five assets

2019

100% renewable electricity across managed retail assets,

increased our community funding in response to the

Covid outbreak, first CDP submission, 12% reduction in

GHG emissions

2020

Ranked 1

place in the GRESB “Management” module out

of a total 901 European participants; 90/100 for the GRESB

“Development” benchmark; 70/100 GRESB score for

“Standing Portfolio” Benchmark; Awarded “A” for

alignment in GRESB’s independent TCFD assessment.

CDP ‘B’ Rating for climate-related issue management;

retained Gold Award in EPRA Sustainability Best Practice

Recommendations Awards.

Collaborating with our occupiers to reduce our carbon

emissions: 57% of our lettable floorspace is occupied by

retailers that have set emissions reduction targets; we

have also generated 250,000 kWh of renewable energy

on-site. Relocated our Head Office to a BREEAM Excellent,

Net-Zero building in London.

2022

Developed net-zero strategy, salary waivers given

to the Trussell Trust, Romford Premier Inn achieved

a BREEAM Very Good certification for design stage,

achieved EPRA Sustainability Best Practice award for

the first time (bronze)

Achieved our target of zero waste to landfill; awarded

‘B’ rating for our second CDP disclosure; advanced our

EPRA sustainability best practice award to Gold; and

made our first gender pay gap disclosure.

2021

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic ReportStrategic report

Our ESG approach

Strategic Report

Improving ESG

Benchmark Performance

ESG Benchmark Performance Highlights

• Developed a lifecycle carbon framework and targets for

our Retained ‘B’ Rating from the CDP for our management

of climate-related issues

• Retained Gold Award in EPRA Sustainability Best Practice

Recommendations Awards

• Achieved an “A” alignment rating in GRESB’s independent

TCFD assessment

• Achieved our target GRESB score of 70/100 for the

“Standing Portfolio” Benchmark

• NewRiver ranked first place in the GRESB “Management”

module out of 901 participants across Europe

• Achieved 90/100 score in the GRESB

“Development” benchmark

• Increased our FTSE Russell ESG Rating to 3/5

Our Response to the Challenges

One of the challenges in improving our ESG benchmark performance

lies in the variation of assessment methodologies emerging from

involuntary benchmarks. Different assessment processes take

different approaches to weighting ESG issues, some have specific

language and metric requirements, and many accept only publicly

available information. As such, performance ratings across

benchmarks of this nature have a high potential for disparity, and it

can be challenging to triage the cumulative feedback.

As an example, we have been using green leases for some time now

despite the limited public disclosure on the subject but we received

feedback from MSCI in January 2022 that there was scope to

improve in their adoption. Along with Cushman & Wakefield, our

lawyers CMS have undertaken a further comprehensive review of our

standard form lease to ensure its alignment with best practice

guidance on green leasing, and we have adopted the approach of

the Global Real Estate Sustainability Benchmark in qualifying the

resultant standard form lease as “green”. We have not provided

quantified disclosures on this metric in previous years due to its

subjectivity, and the likelihood that its definition will evolve over time

and vary between organisations, limiting its usefulness for monitoring

and comparison purposes. We have, however, this year introduced

green clause tracking into our asset management database. For us,

this is about tracking progress towards key targets on our net-zero

pathway, including for 75% of our occupiers to be utilising renewable

energy by 2030, and our use of lease contracts to support the

achievement of this target.

We support the mission of these assessments and benchmarks as an

effective way to improve transparency, enable peer comparisons, and

reduce greenwashing. We aspire to strike the balance of making

publicly available those materials which are relevant to external

stakeholders yet continue to prioritise the ESG areas which are material

to our specific business model whilst accepting that there may be

implications for involuntary ESG benchmark scoring in doing so.

Making progress on our journey

to Net-Zero

FY23 Pathway to Net Zero Highlights

• Developed a lifecycle carbon framework and targets for

our development projects

• Externally verified our GHG disclosures to ISO 14064-3:2019

to enhance transparency and credibility

• Relocated our Head Office to a BREEAM Excellent,

Net-Zero building

• Generated over 250,000 kWh of renewable electricity

on-site at our assets

• Contributed data to the Net Zero Carbon Buildings Standard

• Undertook research into the emissions reduction targets

across our occupier base to inform our collaboration strategy

• Achieved a like-for-like reduction in Scope 1 emissions from

our consumption of natural gas

Our Response to the Challenges

Whilst we progress our business towards a net-zero future we find

the availability, accuracy and completeness of the required data to

quantify carbon impact, challenging. As part of the solution over the

coming year, we will be introducing an employee commuting survey

and making refinements to our processing of business travel

expenses, to improve our ability to accurately monitor and reduce the

impact of these emissions categories. We are also in the process of

analysing our upstream supply chain in more detail with the aim of

gradually moving away from the spend-based method of calculating

our “purchased goods and services” towards a more accurate,

supplier-specific method. We are underway with the first step in this

process creating a matrix of supplier carbon reduction maturity to

support understanding and allow for effective engagement of our

business and our supply chain.

Across the portfolio we continue to make progress accessing reliable

data on occupier energy consumption but it remains challenging

despite 57% of our lettable floorspace being occupied by companies

with their own net zero commitments. This is the primary source of

carbon emissions indirectly arising from our business activities,

accounting for circa 90% of our total emissions profile, and so we

recognise our responsibility to address this area of our impact on the

environment and have included these emissions within our own

target. Achieving this target will require continuing close collaboration

with our occupiers, and we will seek to leverage the existing strong

relationships we have with them to enable us to succeed together.

We are adopting new technology to access consumption data direct

from occupier meters which will mitigate the challenge in this area.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Evolving ESG integration,

riskmanagement, and

stakeholderengagement

We are proud of the great progress and recognition our ESG

strategyhas achieved yet we recognise that there is a constant

cycleof evolution and improvement to undertake in the delivery of

asuccessful ESG strategy. We continue to evolve our ESG activities

to improve business integration, data capture & disclosure and to

engage with our wider stakeholders to help us achieve our

objectivesand targets.

FY23 ESG Business Integration Highlights

• Maintained our “zero waste to landfill” policy

• Full MEES compliance achieved

• Developed a supplier ESG performance evaluation process

• Delivered or secured contracts for EV charging infrastructure

at 88% of our surface-level car parks

• Commissioned a portfolio-wide quantitative climate risk

scenario analysis

• Advanced our Diversity, Equity & Inclusion approach, policy

and targets

• Formalised a quarterly ESG performance review process

for our Property team

• Implemented recommendations from our staff satisfaction

& wellbeing survey

• Provided bespoke ESG training to our centre

management teams

1. J Willis et al. (2023), the Greenwashing Hydra.

Our Response to the Challenges

To ensure our own employees, both Property and Finance, and site

teams are continuing to learn the importance of, and impact they can

have, in the success of our ESG programme we have carried out all staff

ESG training throughout the year including an interactive session at our

annual Centre Manager Conference, held this year at The Moor in

Sheffield. All assets have active Environmental and Social Plans in place

and as part of monitoring individual progress we haveimplemented a

quarterly ESG performance review process forour Property team which

sits alongside the quarterly financial performance review of assets.

Some excellent examples of initiativesat our assets can be seen

throughout the annual report.

On the environmental side, and in particular our renewable energy

generation, where this year we have generated over 250,000 kWh

ofrenewable energy, we find it challenging to improve on this due to

insufficient landlord electricity demand for the communal areas. In a

bid to find a solution to this we commissioned a degasification study

of one of our Core Shopping Centres to assess whether the removal

of gas-powered equipment and its replacement with electric

alternatives could overcome this feasibility issue. The findings of this

study will be utilised alongside the outputs of a series of energy

audits that we will undertake during FY24 to determine the most

effective route to reducing the overall energy demand and

environmental impact of our portfolio.

As always, we look forward to another year of evolving practices

across all areas of our business to drive positive change, and thank

our team most sincerely for their enthusiasm and support for the

steps we are taking.

Emma Mackenzie

Head of Asset Management and ESG

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Sustainable Development Goals (SDGs)

NewRiver has committed to 11 of the 17 Sustainable Development

Goals (SDGs). We have included case studies of various initiatives

delivered throughout the year and we have highlighted within each

one how they fulfilled the respective Sustainable Development Goals

(SDGs) as set out in this key:

Supporting those affected by the

Crisis in Ukraine

The Company raised over £3,750 for Ukraine Aid and over

£350 for the British Red Cross at a corporate level and across

our portfolio as well as collecting essential items including

blankets, toiletries, and clothing. A further £5,000 corporate

donation was also made to the Disasters Emergency Committee.

We continue to show our support for those affected by the crisis

in Ukraine, facilitating community music shows and art sales,

providing storage space for donations, and showing solidarity

with Ukraine through coloured light and window displays and

social media support.

Christmas Dinner by Darlington

College & The Cornmill Shopping

Centre

One Hot Meal provided the opportunity for individuals who use

King’s foodbank in Darlington, to receive a three course

Christmas meal during the festive season. As the cost-of-living

increases, food poverty in turn increases, creating more demand

on foodbanks. This meal was catered by food and beverage

students from Darlington College and was sponsored by The

Cornmill Shopping Centre.

Our Centre Teams helped to

“Keep Britain Tidy”

Craig Allen, Centre Manager at The Arndale Shopping Centre,

Morecambe, led a “Great British Spring Clean” event at

Morecambe beach. The Arndale Centre team was joined by

representatives from Morecambe Town Council and Morecambe

RNLI and together, the group of volunteers collected 15 bags of

litter from the beach, using biodegradable bin bags.

We Retained our EPRA

sBPR Gold Award

Our ESG performance is reported in accordance with EPRA’s

Sustainability Best Practice Recommendations, which support

the transparency and comparability of disclosures on a full

breadth of ESG metrics, from gender diversity to waste

generation.

We ranked in first place for

“Management” out of 901 GRESB

participants across Europe

This recognition is testament to all the work undertaken to

achieve various policy, process and reporting improvements

throughout the business. Key areas in which we outperform our

peer group include “Leadership”, “Risk Management” and

“Stakeholder Engagement”. We also maintained our perfect

score in the broader social and governance aspects of the

assessment.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Accreditation

or commitment

Score

or equivalent

Observations

Global Real Estate

Sustainability

Benchmark

Score:

70/100

We have improved our score year on year from 68/100 to 70/100

and once again achieved a perfect score in the Management

module (30/30), ranking first place out of 901 participants across

Europe. We also achieved full marks in the Social (18/18) and

Governance (20/20) aspects of the GRESB assessment this year,

outperforming our peers again. We continue to work on

improving our performance in the Environmental aspect of the

assessment, which our Environmental Implementation Plans

and occupier engagement initiatives will support.

CDP

(formerly Carbon

Disclosure Project)

Score:

We are pleased to have maintained our ‘B’ score in FY23,

continuing to be recognised by the CDP as “taking coordinated

action on climate issues”.

United Nations

Sustainable

Development

Goals

We are committed to

11SDGs addressing

issues we can

meaningfully impact

We have specific targets and annually track our progress

against them. Please see Our Environmental & Social Targets

for more information.

Task Force on

Climate-related

Financial

Disclosures

consecutive year

reporting

NewRiver publicly supports the TCFD Recommendations and is

in its 5

consecutive year of reporting in alignment with them. We

recently undertook quantitative scenario analysis to support our

understanding of the physical climate risks posed to our portfolio

and the time horizons over which these risks may materialise.

FTSE

Russell

Score:

3.0

In our most recent assessment, we received an overall ESG Rating of

3 out of 5, above the ‘Retail REIT’ average of 2.7 and ‘Financials’

industry average of 2.5, and an improvement on our score of 2.7

from last year. Our key strengths identified by FTSE’s assessment

include Corporate Governance (5/5), Risk Management (4/5),

Anti-Corruption (4/5), and Human Rights & Community (4/5). We have

identified the following areas as opportunities for improvement:

Pollution & Resources, Social Supply Chain and Water Security.

EPRA

sBPR

Award:

Gold

Awards are given by the European Public Real Estate Association

(EPRA) to listed real estate companies in recognition of

excellence in the transparency and comparability of their

ESG disclosures and we are proud to have maintained the

top award status.

Sustainability Accreditations andCommitments

We use industry-recognised indices to track our sustainability performance:

ESG REPORTING PERIOD:

This year we have updated ESG reporting period to the calendar year in order to facilitate the ISO 14064-3:2019 data verification

process. The change to our reporting period means that our financial and ESG reporting years are now 75% consistent,

incorporating Q4 from the previous financial year and Q1, Q2 and Q3 from the current financial year. This is clearly labelled

throughout the report.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

About our ESG Performance Reporting

Each year, our ESG reporting continues to evolve as our ESG

programme matures. Having previously published a standalone ESG

report alongside our Annual Report and Accounts (ARA), we now

integrate our reporting to better reflect the way in which our ESG

strategy is embedded into our business.

We stay abreast of emerging market and ESG disclosure trends and

proactively manage our data collection processes to ensure our

stakeholders are provided with valuable insight into our ESG

performance. It is important to NewRiver that key ESG information on

our business is accessible, and so whilst we adopt an integrated

annual reporting approach, we also make the ESG content of this

report and our TCFD disclosures available in standalone documents

on our website.

A key improvement we have made to our reporting this year is to

have our GHG Emissions Inventory externally verified in accordance

with the ISO 14064-3:2019 Standard. Ahead of our 2025 commitment

to bring our corporate emissions to net-zero, we consider this an

important step on our net-zero journey to enhance the transparency

and integrity of our progress disclosures.

Scope and Boundaries

In order to facilitate the ISO 14064-3:2019 data verification process,

we have altered our ESG reporting period to the calendar year. We

previously reported in direct alignment with our financial reporting

year, however the resource requirements of the ISO 14064-3:2019

standard necessitated that we make this change in order to continue

with our integrated reporting approach. In making this decision, we

considered the following:

1. That the majority of our ESG reporting year should fall within the

same year as our financial reporting (1 April – 31 March), to ensure

that comparisons can be easily drawn between our financial

performance and other aspects of our performance. This is

consistent with guidance provided by the UK’s Department for

Business, Energy & Industrial Strategy on Streamlined Energy and

Carbon Reporting. The change to our reporting period means that

our financial and ESG reporting years are now 75% consistent,

incorporating Q4 from the previous financial year and Q1, Q2 and

Q3 from the current financial year.

2. That we continue to report on a full 12-month period comprising a

spring, summer, autumn, and winter quarter to ensure that

performance over time remains to be comparable and therefore

meaningful. We also considered whether our baseline year of

FY20 – against which our net-zero commitment is made – should

be amended to calendar year. As the 2020 calendar year was

heavily impacted by Covid and therefore represents a potentially

compromised baseline, and as our existing baseline year contains

a comparable 12-month period to our current reporting period, we

have chosen not to “re-baseline” at this time. We intend to review

this decision towards the end of 2023 when a new SBTi standard

for the “Building Sector” is anticipated. We consider that this will be

the appropriate time to review our targets and the opportunity to

re-baseline, including whether adjustments are required to align

with the relevant sector-specific decarbonisation pathway. In the

interim, we have concluded that meaningful performance

comparisons can be drawn between our FY20 baseline data

(1 April 2019 – 31 March 2020) and our current reporting period

(1 January 2022 – 31 December 2022).

This report therefore relates to our ESG performance during the

calendar year of 1 January 2022 – 31 December 2022 which

includes Q4 FY22 and Q1, Q2 and Q3 in FY23. Throughout this

report, this reporting period is referred to as FY23. The preceding

calendar year is utilised for year-on-year performance comparisons,

and is referred to throughout as FY22.

In disclosing our ESG performance, we adopt the Operational Control

boundary, in recognition of this boundary being reflective of our ability

to implement our operating policies and influence ESG performance.

Structure and Materiality

Our disclosures are structured to present stakeholders with an

overview of our ESG programme, our approach to realising our ESG

objectives, and details of our activities within – and performance

against – these objectives.

To maintain transparency and comparability of our performance

disclosures over time, we consistently monitor and report against the

sustainability metrics recommended by EPRA.

We assess the materiality of ESG issues relevant to our business by

considering their potential impact on our portfolio, our stakeholders,

and our communities. The UN Sustainable Development Goals to

which we have committed support guided action on issues that we

have the opportunity to meaningfully contribute to, by nature of our

business model, purpose, and mission. Embedding the

recommendations of the Task Force on Climate-Related Financial

Disclosures allows us to identify risks and opportunities associated

with external factors, and develop an informed and strategic

approach to their management.

Reporting Frameworks

Our ESG reporting is guided by relevant global reporting frameworks

including the EPRA Sustainability Best Practices Recommendations

(sBPR), and the Recommendations of the Task Force for Climate-

related Financial Disclosures (TCFD). Having integrated our ESG

reporting into our ARA, we also adopt the recommendations of the

International Integrated Reporting Council (IIRC).

We are committed to ensuring that we are responsible neighbours in

our communities, supporting and championing local causes and

innovating to address the needs of local people, whilst minimising our

impact on the environment. We are passionate about engaging our

staff and occupiers, and maintaining our high standards of

governance, to ensure we are an excellent employer and company to

do business with.

Our ESG activities are applied through our business model to

meetour ESG objectives. Aligned with our corporate strategy,

ourobjectives are built around four focus areas (refer to page 60)

whichreflect the issues that are important to our stakeholders

andour business.

Progress against our objectives is measured annually against our

ESG targets and external benchmarks, and the outcomes are used to

determine our ESG activities for the following year. This approach

generates a feedback loop whereby our ESG programme can adapt

as our business changes and best practice evolves.

1. Limited assurance based on a data sample of 60% of each emissions category

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Disciplined capitalallocation

Leveraging ourplatform

Flexible balancesheet

OurESG

activities

OurESG

targets

External

benchmarks

and guidance

OurESG

objectives

Our business model is underpinned

by a committed ESG programme

Our ESG Objectives

Minimising our

environmental impact

We have set out our pathway

to achieving net-zero across

our portfolio, and we advise

our capital partners on

environmental best practice

as well as applying this

assessment when we

considerany acquisition.

We leverage the flexibility of

our balance sheet to ensure

investment in energy efficiency

over the next 20 years is

accounted for in financial

planning. For our development

pipeline, we seek to provide

future-proofed community

developments which minimise

carbon lifecycle.

Engaging our team

and occupiers

We raise awareness of evolving

ESG issues with our team and

create opportunities for positive

impact. We engage with our

existing occupiers about

environmental and sustainability

strategies and we typically

pre-let our developments,

allowing us to work with

occupiers to ensure their

requirements are met.

Supporting

our communities

Our assets play a critical role

to the local communities they

are located in and our on-site

teams support local charities

and community groups.

For our development projects,

we work closely with councils

and local groups to ensure

developments address

community needs and

undertakesocial impact studies.

Leading governance

and disclosure

The Board strengthened its ESG

expertise with the appointment

of Karen Miller in 2022 to

oversee our ESG strategy.

Implementation of our ESG

strategy, policies and approach

to environmental risk

management are overseen by

our Head of Asset Management

and ESG who is well placed to

ensure ESG initiatives are

executed across the portfolio

given their combined role.

Our asset management and

development projects adhere

to stringent health and safety

standards and all suppliers

adopt our Code of Conduct.

Are applied through

our business model

▼

To meet

Key

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Our Environmental and Social Targets

In developing our pathway to becoming a net-zero business, we reviewed the original targets we set ourselves in 2018 and considered their

consistency with our net-zero vision, therefore where previous targets did not support our heightened ambitions, they were displaced with our

SBTi-approved (Scope 1 & 2) emissions reduction targets. We combined our improved environmental targets with our existing social targets to

produce a holistic pathway to a 1.5-degree future which engages our stakeholders and delivers positive social impact.

Key

Net-zero targets

UN SDG aligned

Social targets

UN SDG aligned

Environmental targets

2021

2022

2025

2030

2040

2050

Achieve net-zero for all

corporate-related carbon

emissions (Scope 1-3).

85% recycling rate at our

managed properties.

Electric vehicle charging

points installed across all retail

properties with a surface-level

car park.

50% improvement (from a 2020

baseline) in landlord on-site

renewable energy generation.

Building certifications targeted,

and lifecycle carbon assessments

undertaken, for 100% of our

new construction and major

renovation projects.

Achieve a 75% response rate to

our occupier satisfaction survey.

Biodiversity plans to be in place

for at least 15% of our assets.

Receive target validation from the

Science-Based Targets Initiative

(SBTi for aligning our net-zero

pathway with a 1.5-degree global

warming trajectory.

100% of waste generated at our

managed properties is diverted

from landfill.

100% of landlord electricity is

procured from renewable

sources.

Provide a minimum of one work

experience placement per year at

50% of our assets.

Achieve a 90% response rate to

our annual staff wellbeing survey.

All enclosed shopping centres to

participate in our Quiet Hour

Initiative and have a community

engagement plan in place.

50% of NewRiver staff to

participate in our volunteering

programme.

Achieve a 42% reduction (against

baseline) in carbon emissions

across our corporate activities

and operational real estate, as

required by the SBTi.

75% of occupiers transitioned to

renewable energy supplies.

Achieve net-zero in terms of

operational and embodied

emissions (Scope 1-3) across

our portfolio, whether space is

directly managed, or managed

by third parties.

Over 25% of landlord energy

is generated on-site from

renewable sources.

Achieve net-zero for all

operational emissions from the

directly managed areas of our

portfolio (Scope 1-3).

Publicly commit to net-zero

and set FY20 carbon

emissions baseline.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Minimising our Environmental Impact

Minimising our environmental impact means taking action at the corporate, portfolio, and asset level. We have policies in place to guide

corporate-level activity which engage our staff on principles of collective environmental responsibility that can be applied across our business.

Our net-zero pathway and interim targets guide our initiatives, supported by our asset-level Environmental & Social Implementation Plans,

which allow us to monitor our progress and accelerate action where required.

Progress Towards Our Near-Term Environmental Targets

Target Target

Year

Complete

FY23 Progress Report

100% of waste

generated at our

managed properties is

diverted from landfill

2022 100%

We are pleased to have achieved our target of zero waste to landfill in FY22 and

maintained this policy throughout FY23.

100% of landlord

electricity is procured

from renewable sources

2022 100%

We transitioned all landlord electricity supplies across our portfolio to Renewable

Energy Guarantees of Origin (REGO) backed tariffs in 2020.

85% recycling rate at

our managed properties

2025 74%

Considering only non-organic waste, our FY23 recycling rate was 63%, consistent

with FY22’s rate. As a % of total waste, the proportion of waste recycled decreased

slightly from 58.8% to 57.9%. The proportion of waste incinerated also decreased

slightly from 35.1% to 34.6%.

Whilst a decrease in overall waste recycled appears contrary to our target to

increase recycling rates, this % decrease (alongside the similar % decrease in total

waste incinerated), was driven by increased composting and anaerobic digestion

through improved segregation of food waste, which improved from 6.0% in FY22,

to 7.6% in FY23.

Electric vehicle charging

points installed across all

retail properties with a

surface-level car park

2025 41%

We currently have EV charging installations at 7/17 of our surface-level car parks,

with contracts in motion to deliver installations at a further 8 sites, which will bring

our progress rate to 88%. We previously reported a progress rate of 94%, however

one of our sites has since been deemed unfeasible by the EV solutions provider to

which it had been under offer. We will progress our own feasibility assessments of

the remaining two car parks as part of our net-zero pathway action to review and

create comprehensive green travel plans for all assets in 2024.

50% improvement

(from a 2020 baseline)

in landlord on-site

renewable energy

generation

2025 0%

Renewable energy generation at the assets within our operational control boundary has

decreased by 15% between 2020 and 2022. This is partly because existing installations

are aging, and because we have not commissioned any new installations during the last

couple of years. This year, we have also had persistent issues with our PV systems at the

Hildreds shopping centre in Skegness, with data for one of these systems being

unavailable, therefore contributing to the decrease in generation.

We have undertaken various exploratory exercises to understand the feasibility of new

installations at other assets, with a key barrier being insufficient landlord energy demand.

This year we commissioned a decarbonisation study of one of our Core Shopping

Centres to assess whether the removal of gas-powered equipment and its replacement

with electric alternatives could overcome this feasibility issue. The findings of this study

will be utilised alongside the outputs of a series of energy audits we will undertake

during FY24 to determine the most effective route to reducing the overall energy

demand and environmental impact of our portfolio.

Building certifications

targeted, and lifecycle

carbon assessments

undertaken, for 100% of

our new construction and

major renovation projects

2025 N/A

In the 12 months to 31 December 2022 we completed one major development

project which comprised of an extension to the former Next unit to create a new

Aldi store at our retail park in Dewsbury. At project inception in 2020, an

appropriate building certification or requirement for an LCA were not identified for

the scale and nature of the project. However, we have since introduced a strict

policy for all new construction and major renovation projects to be subject to an

LCA from 2023 onwards, as part of our net-zero pathway.

ENVIRONMENTAL

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Energy and GHG Emissions Performance

On Earth Day, 22

April 2022, we became a signatory to the

Better Buildings Partnership’s Climate Commitment, joining other

responsible organisations across the industry in pursuing a 1.5°C

future for our planet. In becoming a signatory, we have committed

to publishing our net-zero carbon pathway and delivery plan,

disclosing the energy performance of our assets, and developing

a comprehensive climate resilience strategy. The initiative has an

overreaching objective of delivering net-zero buildings by 2050,

incorporating both operational and embodied carbon. The scope

of the commitment makes it one of the most ambitious commitments

that property owners can adopt.

You can read more about our commitment and delivery strategy in

our Pathway to Net-Zero, which can be found in the Sustainability

section of our website.

In-line with the Companies Act 2006 (Strategic & Directors’ Reports)

Regulations 2013, we disclose our annual global GHG emissions in

terms of our total energy use, intensity ratio, and a narrative on the

energy management and efficiency measures we implement.

The table below presents our total energy use, including electricity

on both a location and market basis. It also contains our carbon

footprint across Scope 1, 2 and 3 emissions, as well as an appropriate

carbon intensity metric. The performance data presented below

relates to the 2022 calendar year, 1

January 2022 – 31

December

2022, but consistent with the rest of this report, is referred to as

FY23. For the avoidance of doubt, FY22 figures relate to the calendar

year of 2021.

FY23 Performance Highlights

• 17% reduction in absolute Scope 1 emissions from the

combustion of gas & other fuels

• Like-for-like gas consumption reduced by 4%

• 12% reduction in total Scope 1 & 2 emissions from our

baseline year of FY20, bringing us 29% of the way to our

SBTi-approved 2030 target to reduce absolute emissions

by 42%

• 257,464 kWh of renewable electricity generated on-site

at our assets

Our 2022 SECR disclosures FY23

FY22

% Change

Greenhouse Gas Emissions by Scope (tCO

Scope 1 Emissions from combustion of gas & other fuels

786.3 942.2 -17%

Scope 2 Location-based emissions from electricity purchased for own use

2,029.2 2,315.4 -12%

Scope 2 Market-based emissions from electricity purchased for own use

0 0 0%

Scope 3 Emissions from purchased goods & services, capital goods, fuel & energy-related

activities, waste, business travel & employee commuting, and downstream leased assets

24,784.8 30,556.6 -19%

Total Scope 1, 2 & 3 location-based emissions

27,600.3 33,814.2 -18%

Total Scope 1, 2 & 3 market-based emissions

25,085.8 30,895.9 -19%

Intensity Scope 1 & 2 (location-based) tCO

e/m

0.017 0.018 0%

Energy Consumption (kWh)

Energy use from the combustion of gas and other fuels

4,307,514 5,144,303 -16%

Energy use from consumption of electricity purchased for own use

10,493,433 10,904,824 -4%

Energy use from business travel

11,069 7,587 46%

2. 12-month period ending 31 December 2022

3. 12-month period ending 31 December 2021

* Refer to Data Notes on p.72

The key milestones on our journey to becoming a

net-zero business are:

• 2025: all corporate emissions (Scopes 1-3) will be brought

to net-zero

• 2030: we will achieve a 42% reduction in absolute emissions

from our 2020 baseline

• 2040: all emissions arising from the landlord-controlled areas

of our portfolio (Scopes 1-3) will be brought to net-zero

• 2050: all emissions arising from the tenant-controlled areas of

our portfolio, and from our development activities, will be

brought to net-zero, making us a fully net-zero business.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Energy Management and Efficiency Measures

Environmental & Social Implementation Plans are in place across

100% of our managed shopping centres. The plans specify four

mandatory energy management and efficiency measures which must

be reviewed, on a quarterly basis, for implementation at all centres

where they are relevant and feasible. These measures are:

• Routine reviews of the installation of smart meters (AMR) for all

relevant utility types

• Installation of LEDs in all landlord-controlled areas

• Implementing a Building Management System optimisation

programme

• Reviewing plant equipment run times and controls at least

quarterly and ensuring optimum settings are in place for

day/night, seasons and occupancy

We have increased AMR coverage (electricity and gas) across our

portfolio to 86% over the course of FY23. We have also recently

invested in a new Smart Building Platform (IBOS) at Broadway Square

shopping centre in Bexleyheath which, through remote connectivity,

optimises HVAC and other building systems to provide real-time,

automated control and visibility of the building’s internal environment,

delivering the actionable insight required to improve performance.

The majority of our centres have now replaced all feasible landlord

lighting installations with LEDs and/or have an active roll-out

programme in place. At centres that have passenger lifts, energy

efficient kinetic motors are being installed where possible.

We undertake ongoing reviews of plant equipment run times and

controls and at The Piazza, our shopping centre in Paisley, we have

halved the number of AHUs in use. This centre has also upgraded

thecombi-boiler in the management suite, leading to a significant

reduction in energy consumption. Consideration given to heating

requirements for back of house areas at the Forum Shopping

Centre in Wallsend has also more than halved gas consumption

at this centre.

Data Notes

Reporting

Period

Our GHG emissions performance disclosures relate to the calendar year of 2022 (referred to as FY23). Emission data from

the calendar year of 2021 (referred to as FY22) has also been included.

Boundary

We have used the Operational Control method to outline our carbon footprint boundary. Emissions arising from occupiers’

energy usage are not included in our Scope 1 and 2 reporting boundaries, but are reported in Scope 3 as downstream

leased assets. Our Operational Control boundary excludes assets owned by JV partnerships, as well as assets where we

act only in an advisory capacity.

Reporting

Method

We have measured emissions based on the GHG Protocol Corporate Accounting Standard (revised edition) and guidance

provided by the UK’s Department for Business, Energy & Industrial Strategy and the Department for Environment, Food

and Rural Affairs (Defra) on Streamlined Energy and Carbon Reporting and greenhouse gas reporting.

Emissions

Factor

The emission factors and conversions used for 2022 (FY23) reporting are from the Defra greenhouse gas reporting tool

2022 and the factors and conversions used for 2021 (FY22) reporting are from Defra’s 2021 reporting tool.

Scope 3

emissions

We used the GHG Protocol Scope 3 Standard to collate and report on our Scope 3 emissions in the form of emissions from

purchased goods and services, capital goods, fuel and energy-related activities, waste and water, business travel,

employee commuting and downstream leased assets.

Intensity Level

For intensity level reporting, we have used the directly controlled (landlord) area of our portfolio as the denominator. Vacant units

have been excluded in the intensity measure due to the year-on-year variability.

Data

Restatement

FY22 data has been recalculated to the calendar year period (of 2021) to achieve consistency with FY23 (calendar year

2022) disclosures. Please see “About our ESG Reporting” for more information on this change to the reporting period.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Our Corporate Environmental Performance Measures

NewRiver occupied 16 New Burlington Place as our head office until mid-July 2022. In April 2022, we took occupation of 89 Whitfield Street

as our new head office and entered a fit-out period of circa 3 months, before we officially moved in mid-July 2022. There was therefore a

3-month period during which we were responsible for utilities at both 16 New Burlington Place and 89 Whitfield Street, which is included in

our disclosures. 2022 intensity disclosures are based on the average floor area across the two office spaces, with 89 Whitfield Street being

approximately 45% of the area we previously occupied at 16 New Burlington Place. There were no waste collections for NewRiver at 89

Whitfield Street during the fit-out period.

Absolute Performance (Abs)

EPRA Code Performance

Measure

Unit(s) of

Measure

Boundary

% of data

estimation

FY23 FY22

% Change

Elec-Abs

Electricity consumption

Annual kWh 0% 31,932 34,214 -7%

DH&C-Abs

District heating

& cooling

Annual kWh Our corporate offices are not connected to district heating & cooling

Fuels-Abs

Fuel consumption

Annual kWh

See footnotes

24,832 41,009 -39%

Energy-Int

Energy intensity

kWhelec-eq/m2/yr 82 76 8%

GHG-Dir-Abs

Scope 1 emissions Kg CO2e 4,568 7,511 -39%

GHG-Indir-Abs

Scope 2 emissions

(location-based)

Kg CO2e 0% 6,175 7,265 -15%

Scope 2 emissions

(market-based)

Kg CO2e 0% 0 0 0%

Scope 3 emissions

Kg CO2e

See footnotes

2,476 3,502 -29%

GHG-Int

Scope 1 and 2 emissions Kg CO2e/ m

/ year 17.63 17.61 0%

Water-Abs

Water consumption

Annual m

166 258 -36%

Water-Int

Water intensity M

consumption/ m

0.27 0.31 -11%

Waste

Kg total waste

Kg 1,072 2,285 -53%

Recycling rate % total waste

recycled

0% 51% 45% 13%

1. Carbonxgen prepares precise apportionment of electricity charges for 16 New Burlington Place, whilst gas and water are apportioned based on whole building

data. We have apportioned gas and water consumption based on the percentage of direct NewRiver usage of the total electricity consumed on site, which over

the relevant months was 4%.

2. Waste data for 16 New Burlington Place is prepared on a whole building basis. We have apportioned waste based on the floor area apportionment attributed to

NewRiver for service charge purposes (21%).

3. Scope 3 emissions as presented above include the emissions associated with our occupation of our corporate offices, and so include water consumption, waste

generation, and indirect emissions from our consumption of energy.

4. kWh elec-eq/m2/yr is calculated using the REEB Benchmark 2020.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Our Portfolio Environmental Performance Measures

Absolute Performance

(Abs)

Like-for-like Performance (LfL)

EPRA Code Performance

Measure

Unit(s) of

Measure

% of Data

Estimation

FY23 FY22 FY23 FY22 %

Change

Elec-Abs,

Elec-LfL

Electricity

consumption

Annual MWh 0.4% 10,462 10,871 10,262 10,124 1%

DH&C-Abs &

LfL

District heating &

cooling

Annual MWh None of our properties were connected to or benefited from district

heating & cooling

Fuels-

Abs,Fuels-LfL

Fuel consumption Annual MWh 0.1% 4,283 5,103 4,109 4,268 -4%

Energy-Int

Energy intensity kWhelec-eq/m2/yr 0.077 0.078 0.080 0.080 0%

GHG-Dir-Abs

Scope 1 emissions Tonnes CO

e 782 935 750 782 -4%

GHG-Indir-Abs

Scope 2 emissions

(location-based)

Tonnes CO

e 2,023 2,308 1,984 2,150 -8%

Scope 2 emissions

(market-based)

Tonnes CO

e 0 0 0 0 0%

Scope 3 emissions Tonnes CO

e 751 893 607 819 -26%

GHG-Int

Scope 1 and 2

emissions

Tonnes CO

e/ m

year

0.016 0.017 0.017 0.018 -7%

Water-Abs,

Water-LfL

Water consumption Annual m

4.1% 57,540 45,411 56,545 43,291 31%

Water-Int

Water intensity m

consumption/

0.33 0.24 0.34 0.26 31%

Waste-Abs,

Waste-LfL

Tonnes total waste

Tonnes

0.8% 3,253 2,919 3,249 2,818 15%

Tonnes diverted

from landfill

0.8% 3,253 2,919 3,249 2,818 15%

Tonnes waste to

energy

1.4% 1,124 1,026 1,120 1,006 11%

Tonnes recycling 0.5% 1,882 1,718 1,881 1,636 15%

Cert-ToT

Type and number

of sustainably

certified assets

Total number by

certification/

rating/ labelling

scheme

Please see page 68 for a detailed breakdown of this performance measure.

1. Data coverage: the figures reported against each performance measure represent 100% of the assets within our Operational Control reporting boundary.

2. Normalisation: Intensity indicators for energy, water and waste are based on relevant floor area.

3. Scope 3 emissions relate to the emissions included in our 2040 net-zero target, which are those arising from the directly controlled areas of our assets (i.e.,

waste, water, and upstream emissions and transmission & distribution losses from energy consumption). We have chosen to include these categories only to

provide a clear performance comparison, as all other Scope 3 categories are otherwise difficult to distinguish when collated with “downstream leased assets”.

4. Absolute and like-for-like asset-level performance measures include only landlord-procured energy/water. This does not include sub-metered energy procured

on behalf of occupiers on inclusive leases, which amounted to 17,684 kWh in 2022 (electricity only), and which is accounted for in the Scope 3 emissions

category of “downstream leased assets” reported within our SECR disclosure on page 63.

5. “Estimation” refers to filling invoice gaps, not to whether invoices are based on “estimated” or “actual” readings. Although a vast majority of the data presented is

based on actual consumption, in the instances where there were gaps in electricity and water consumption, the average of the months where we had data was

applied to the missing months. Where data covered only part of a month, a pro-rata method using known consumption was applied. With regards to natural gas,

due to the variability of consumption throughout the year, any unknown consumption was estimated using seasonal trends.

6. As our portfolio is comprised of entirely retail properties within the UK only, we do not undertake segmental analysis.

7. Our environmental and social performance data has been collated and checked by Cushman & Wakefield.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

-4%

10,462

Electricity Consumption (Portfolio)

10,871

FY22 FY23

-16%

4,283

Gas Consumption (Portfolio)

5,103

FY22 FY23

2,023

-16%

751

Total Portfolio Scope 3 GHG Emissions

Performance (absolute)

893

FY22 FY23

-16%

782

2,023

Total Portfolio Scope 1 & 2 GHGEmissions (absolute)

935

FY22 FY23

-12%

2,308

FY22 FY23

We have switched our gas supplies to a carbon offset tariff

, to

support with further reducing our environmental impact ahead of

our target to bring these emissions to net-zero. We have also

begun evaluating opportunities to replace gas-powered

equipment in the common areas of our centres, starting with a

feasibility study at our Broadway Shopping Centre in

Bexleyheath. The study provided valuable insights on the

opportunities and challenges of achieving degasification,

including practical requirements in terms of physical space for

on-site renewable technologies. The findings of this study will be

considered in detail alongside those from the audits we will

carry out in FY24 pursuant to ESOS Phase 3, and an overall

implementation strategy and timeline developed to achieve

optimum savings across our portfolio.

Refer to page 83 for more detail

In terms of our Corporate emissions, we saw a 28% decrease in

emissions arising from our consumption of energy and water,

and waste generation, as a result of our move to our new

BREEAM Excellent

head office location. We did however see an

increase in our business travel, particularly domestic air travel,

with Covid-related travel restrictions now completely lifted.

These two changes served to effectively offset one another,

equating to approximately 5 tonnes of CO

e each.

4. For the avoidance of doubt, these offsets are not reflected in our emissions

disclosures

5. In construction

A Review of Our Performance

In FY23, we saw a 4% decrease in like-for-like gas consumption

across our portfolio, equating to a CO

e saving of 26 tonnes. These

savings can partly be attributed to the implementation of our initiative

to review plant equipment run times and controls at least quarterly,

ensuring optimum settings are in place to reflect space usage, whilst

continuing our roll-out of AMRs. We also saw that some centres’

energy consumption benefited from a milder winter quarter in 2022.

Over the course of FY23, we saw a negligible increase in like-for-like

electricity usage of 1%. This was primarily driven by corrections to

consumption figures following underestimated bills from suppliers

during the previous year, and fluctuations relating to vacant units.

Considering only those properties unaffected by supplier billing

corrections, electricity consumption remained largely stable. Overall,

our absolute electricity consumption was down by 4%, driven by

asset disposals which took place during the year. This was also the

key driver of the overall reduction in Scope 3 emissions, as

downstream leased assets make up the vast majority of this

emissions category.

% change

Key

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Certifications & Energy Performance Certificates

Since October 2008, an Energy Performance Certificate (EPC) has been legally required when a building is sold, rented, or constructed. A

certificate is valid for a period of 10 years; on expiry there is no legal requirement to replace an EPC unless the property is to be sold or let. In

England & Wales, the Minimum Energy Efficiency Standards (MEES) now require that all properties, where valid EPCs exist, must have an asset

rating of “E” or above to be lawfully let. Previously this requirement only applied to new tenancies, however it was extended to cover existing

(non-domestic) tenancies on 1 April 2023.

EPC certificates by Region and Asset Rating

In the below table, the number of certificates is presented within each legislative region (England & Wales, Ireland, and Scotland) by asset

rating, A+ through to G. We have also disclosed the number of units with no/expired EPCs to provide clarity on certification coverage across

the portfolio. This excludes recently sold assets for which we acquired new EPCs for the purposes of sale.

We are pleased to have achieved full compliance with the 1 April 2023 MEES deadline across our operational control portfolio, with the single

“F” asset rating shown below (England & Wales) relating to a vacant unit pending redevelopment.

We also have further certificates pending covering over half of those units currently in the category of having no/expired EPCs. Draft ratings

have been issued for c.40% of these to date - currently undergoing Elmhurst’s quality control requirements due to the volume of certificates

pending lodgement - with the draft ratings indicating that we can expect 96% of these to be rated A-C. Our assessors do not anticipate any

F-G ratings amongst these certificates.

Region A+ A B C D E F G No/ Expired EPC

England &

Wales

0 5 104 209 175 94 1 0 286

Northern

Ireland

0 0 2 15 11 3 0 4 35

Scotland

0 0 0 14 19 28 10 14 85

Total

0 5 106 238 205 125 11 18 406

The below chart shows NewRiver EPCs for the England & Wales retail portfolio in comparison to the national EPC register, comparing

against other non-domestic certificates. Our data shows that the NewRiver portfolio out-performs the EPC profile of the national database,

having a higher proportion of certificates providing a minimum rating of “C” (50%), and a lower proportion of certificates rated “F” or “G” (5%).

Our programme of EPC assessments and Minimum Energy Efficiency Standards (MEES) risk reduction has ensured we can continue to let

properties lawfully, protecting the portfolio against potential compliance-related risks to value.

EPC Performance

NewRiver Retail Portfolio (E&W) in Comparison to National EPC Register

A CB

A+

D E F G

National database*

NewRiver Portfolio

* National EPC database

figures correct as

of March 2023

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Water Performance Summary

FY23 Performance Highlights

• Water efficiency measures installed at various sites, including

water re-use in connection with both irrigation and cleaning

• We have begun switching our water meters to smart meters

• Our energy broker, who manages our water meters, has

upgraded their water validation systems to improve the data

we receive on our consumption

Waste Performance Summary

FY23 Performance Highlights

• We maintained our policy to divert 100% of our waste from

landfill

• Our recycling rate was 63%

, bringing us three quarters of the

way to achieving our 2025 target of 85%.

• 65% of total waste generated avoided incineration. Waste that

was incinerated benefited from energy recovery.

6. based on total non-organic waste

7. Calendar year of 2022

8. Calendar year of 2021

Narrative on FY23 Performance

In FY23

, the waste generated across our like-for-like portfolio

increased by 15%, largely attributable to the re-opening of our

occupiers’ stores following successive periods of closure during 2021,

when total waste generated reduced by a third compared with FY20.

Considering only non-organic waste, the % split of waste recycled

(63%) and incinerated (37%) remained consistent. As a % of total waste,

the proportion of waste recycled decreased slightly from 58.8% to

57.9%. The proportion of waste incinerated also decreased slightly from

35.1% to 34.6%. These decreases occurred in favour of an increase in

the proportion of waste composted and/or sent to an anaerobic

digester, which improved from 6.0% in FY22

, to 7.6% in FY23.

Whilst a decrease in overall waste recycled appears contrary to our

target to increase recycling rates, this % decrease (alongside a similar

% decrease in total waste incinerated), is driven by increased

composting and anaerobic digestion through improved segregation

of food waste.

However, looking only at non-organic waste, our recycling rates have

remained stable. Improving waste sorting facilities and our

understanding of barriers to further recycling have therefore been

identified as priority areas for our centre management engagement &

training, which will take place later this year.

Narrative on FY23 Performance

In FY23, we unfortunately saw a 31% increase in like-for-like water

consumption across our portfolio, in part as a result of a considerable

underground leak identified at the Abbey Centre, Newtownabbey.

Excluding this isolated incident, water consumption across the

remainder of our portfolio increased by 18%, with a key driver

including increased trading of our F&B retailers as a result of

improved customer confidence owing to the passage of time since

the worst of the Covid pandemic.

Water efficiency measures installed during the year included:

• a leak detection system at the Ridings Centre, Wakefield

• installation of water butts to the roof of the Cornmill Centre,

Darlington for irrigation purposes

• re-use of rainwater through deionised reach & wash window

cleaning system, to clean the glazed roof areas of the Avenue

Our Environmental & Social Implementation Plans require that

opportunities to install leak detection systems, reuse stormwater and/

or grey water, and to install low-flow fixtures, are reviewed on a

quarterly basis. This ensures that there is an ongoing process of

assessing the feasibility of initiatives which seek to contribute to

reducing our water consumption. Whilst the leak we experienced at

the Abbey Centre was unfortunate, this is a lesson that will be drawn

upon in our evaluation of leak detection systems as part of these

plans going forward.

3.2%

4.4%

34.6%

28.8%

29.0%

Waste to incineration with energy recovery

Waste to dedicated recycling facility

Waste to mixed recycling facility

Waste to composter

Waste to anaerobic digestion

1.5%

16.1%

0.9%

0.02%

0.48%

60.9%7.6%

0.6%

11.9%

General waste

Dry mixed recycling

Cans & Plastics

Glass

Wood

Mixed metals

Other

Food waste

Paper/Cardboard

Disposal Route Waste Type

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Maximising our Social Impact

Maximising our social impact means taking every opportunity to generate meaningful social value in our workplace and in our communities.

We recognise that social value comes in many forms and believe that action should respond to need; therefore, we take careful consideration

of the most pertinent issues to our staff, our occupiers, and the thousands of visitors to our centres across the UK.

Progress Towards Our Near-Term Social Targets

Target Target

Year

Progress

FY23 Progress Report

Support a minimum

of 5 industry/ career

engagement activities

for young people

per year

Per year N/A

This is a new target which we have set ourselves this year following the expiration of

our previous work experience offering target. Last year, we disclosed that we had not

fulfilled our target to provide work experience placements at 50% of our assets, as our

centre teams found it particularly challenging to meet the supervision requirements of

local school engagement programmes.

As such, we have reviewed our school engagement and careers support strategy,

toensure our efforts are focused where they will have most value for recipients.

To this end, NewRiver has become a member of The Academy of Real Assets (TARA).

Examples of initiatives which we will support in pursuit of this target include:

employment fairs, interactive days/workshops in schools, site visits at our assets,

andwork experience opportunities.

So far, we have contributed to TARA’s book competitions and provided meeting space

for their board, and we look forward to becoming actively involved in face-to-face

engagement activities with the young people they aim to inspire into

the real estate industry.

Achieve a 90%

response rate to

our annual staff

wellbeing survey

2022 100%

We are pleased to have exceeded our target, having achieved a 100% response rate to

our 2022 staff wellbeing survey.

All enclosed shopping

centres to participate

inour Quiet Hour

Initiative and

haveacommunity

engagement plan

inplace

2022 100%

The introduction of asset-level Environmental & Social Implementation Plans across our

portfolio means that all centres have an action plan in place for ongoing community

engagement activities, with the Quiet Hour initiative forming a key component of these

plans. Some centres experienced Covid-related disruptions to their Quiet Hours,

however most were able to re-instate them by the end of 2022. All centres have

nowre-instated their Quiet Hours.

50% of NewRiver staff

to participate in our

volunteering

programme

2022 100%

In FY23, NewRiver staff provided 94 hours of volunteer support to the Trussell Trust,

with volunteering sessions typically lasting around five hours each. Further volunteering

support was provided to charities close to individual staff members, amounting to 108

hours. Overall, NewRiver staff therefore participated in 40 volunteering sessions, which

equates to an 82% participation rate. We have therefore achieved this target.

The NewRiver team also supported their chosen charities in other ways, such as

through fundraising activities. For example, over £900 was raised for Macmillan Cancer

Support through sponsored exercise challenges.

Achieve a 75%

response rate to our

occupier satisfaction

survey

2025 50%

Based on our most recent occupier survey, we are currently at the halfway point to achieving

this target. Our centre managers play a pivotal role in our ability to collect a representative

sample of occupier views, and we have sought their feedback on our current research

collection processes, which we will utilise to help increase our response rate. We will also be

introducing a charity donation incentive to encourage greater levels of participation.

Biodiversity plans to be

in place for at least 15%

of our assets

2025 20%

Pre-defined biodiversity initiatives are reviewed on a quarterly basis across all centres as

part of our Environmental & Social Implementation plans. We have also commissioned a

specialist ecology survey of one of our centres to assess both biodiversity enhancement

opportunities and landscaping improvements. Considering only externally produced

biodiversity plans, our current progress against our target is 20%.

SOCIAL

Strategic Report

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Our ESG approach continued

Engaging our Team

Our approach to engaging our team is centred around our aspiration

to listen. We seek to understand the varying priorities of our team

across all levels and departments of our business to enable the

development of policy and process solutions which respond to

staffneeds, support wellbeing, and provide a positive cultural

environment within which colleagues envisage continuing their

careerdevelopment in the long term. We believe the longstanding

nature of our low employee turnover rate is testament to the

effectiveness of this approach.

Monitoring

Needs

Assessment

Action

Planning

Policy

Development

Staff

Training

Implementation

FY23 PERFORMANCEHIGHLIGHTS

Our most recent staff survey returned an overall satisfaction

score of 71%, with over 80% of staff identifying that they:

• Resonate with the company values

• Frequently receive useful career and personal

development feedback, recognition and encouragement

from their line managers

• Are confident in our zero-tolerance approach

todiscrimination

• Feel that we are flexible towards family commitments

• Are satisfied with the information we provide

on mental health

• Consider their mood at work to be generally positive

• Find it easy to concentrate in the office

environment provided

• Feel supported by their team members and

enjoy working with them

• Are challenged and excited by the work they

do at NewRiver

How we

engage

ourteam

Monitoring and needs assessment take place both through the

employee appraisal process and anonymously via our annual staff

survey. Our internal staff survey is developed in partnership with,

andresponses are independently analysed by, Cushman &

Wakefield. Questions are designed to gain insights into staff opinion

and identify beneficial actions in respect of NewRiver’s policies,

procedures and cultural norms in the areas of: leadership team/

management personnel; company culture; corporate social

responsibility; employee health and wellbeing; personal growth

opportunities; team dynamics; and the benefits and recognition

scheme.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

We received recommendations from Cushman & Wakefield following our most recent survey, which we have considered and

actioned as follows:

Recommendation Action taken

Utilise key findings from the

surveyto further educate staff

onthewellness benefits of our

flexibleworking policy and

ensurefull cultural acceptance

ofournew ways of working, to

empower all staff to exercise the

policy in a way that reflects their

personal circumstances

The flexible working policy has been clarified with the team at various points since its inception,

with the formalisation of a policy for all staff to work 3 days per week in the office and 2 days flexibly.

Days “on site” at our assets count as “in office” days, to maintain the intended balance. The policy

allows individuals to choose which days they work in office, subject to the needs of the business and

their teams.

The move to our new flexible working environment at 89 Whitfield Street also engenders the

hybrid working approach with hot desking, with fewer desks than head count underpinning the

business’ expectation and understanding that the entire team works flexibly.

Communication is enhanced by the maintenance of a “Days in the Office” diary so everyone

can see the work choices their team members have made.

Consider opportunities to broaden

the staff training programme to

include soft skills training on topics

such as communication, presentation

and listening skills

We have made further investment in training with a Senior Leadership Team Workshop and Away

Day, facilitated by an external consultant. The workshop utilised Myers-Briggs Type Indicator profiling

and then discussion around how that profiling can be leveraged to improve communication and

leadership styles.

Bi-weekly staff meetings covering a variety of topics are now fully operational and regularly delivered

by external speakers to provide insight and training on topical issues and industry trends. We have

also explored the opportunity for further training with our Apprenticeship Training Provider (Multiverse),

offering the opportunity to all staff to take advantage of upskilling courses, including Data Literacy and

Business Transformation. These courses are suitable for varying levels of experience and cover topics

such as managing change in a digital world and leveraging data management tools to develop

narratives and support decision-making.

Presentation Skills Training will also be offered to all staff at the start of FY24. This will cover both

virtual presentation as well as face to face skills training.

Consider the feasibility of introducing

a “focus time” policy, allocating

dedicated focus time in all staff

calendars, during which internal

meetings would be discouraged.

This is identified as a potential action

to support employees’ preferred

ways of working

With the move to our new office at 89 Whitfield Street which provides staff with access to the building’s

communal working space, offering the opportunity to step away from the main office environment and

secure some quiet time, we have chosen not to allocate dedicated “focus time” in the diary at this

stage. We will continue to monitor views on whether our current solution is effective, and reconsider

Cushman & Wakefield’s recommendation if required.

Utilise survey feedback to inform

the design of our new office space.

Employees have communicated that

breakout spaces which encourage

social interaction are particularly

important to them

The new offices are based on a hot desking principle with ample breakout spaces, both informal and

formal. The feel of the new office is relaxed and non-corporate with comfortable chairs, lots of plants to

enhance wellbeing. An on-site café is also available for a quick coffee catch-up or lunch, and is well-utilised

by NewRiver staff.

We also have a wellness team which organises various activities alongside promoting participation in the

regular timetable of activities arranged by Derwent London (our landlord) which includes pop-ups and

competitions, such as a table tennis tournament which we recently won!

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Helping our Team embed our ESG Programme into the business

ESG training is delivered to our team by our external consultants on an annual basis. Training sessions cover a range of topics including

industry initiatives and trends, updates on our performance, and support for implementing any newly introduced policies and processes. Annual

training sessions extend to our on-site teams, who receive training specific to the nature of their roles.

We also run more informal sessions on an ad-hoc basis throughout the year, to provide specific updates and ensure timely implementation of

new processes as they are established. Recent examples include a morning coffee break session providing tips for understanding our personal

carbon footprints and how to make more environmentally conscious choices at home, as well as training on an improved MEES risk

management process.

The latest process improvements we have made to further our work to embed our ESG objectives in all business functions include:

Process Quarterly Property ESG

PerformanceMonitoring

Supplier Vetting

& ESG Evaluation

Business function Asset Management Finance & Procurement

Description

Introduction of sustainability KPIs to be monitored by

asset managers across our core portfolio on a

quarterly basis, for inclusion in existing reporting

processes. KPIs consider issues such as recycling

rates, AMRs, green lease clauses, occupier

engagement, and the delivery of initiatives through

our Environmental & Social Implementation Plans.

Improvements to our processes for vetting suppliers,

in particular to include consideration of their

approach to key ESG issues which are important to

our business. The new process will enable an

evaluation of potential suppliers’ approaches to

sustainability, so that we can assess the level of

alignment between our objectives and our spend on

goods & services.

Intention

To embed ESG performance monitoring into broader

asset performance monitoring

Enable understanding of supplier ESG performance;

Support our move away from the spend-based

method of calculating the carbon emissions that arise

from these activities.

We continue to include personal ESG targets in employee goal setting and performance appraisals. We encourage employees to include

targets which support our corporate objectives, but also provide the flexibility to set personal targets that address issues which are important to

them or their role. Members of senior management also have specific ESG-linked performance goals connected to their remuneration.

We Continue to be Recognised by

the CDP for Managing Climate Issues

NewRiver seeks to be transparent in its approach to climate

action, and participating in the CDP is an essential part of the

way we achieve this. In the 2021 and 2022 benchmarking

processes, we were awarded a score of ‘B’, taking us from the

‘awareness’ to the ‘management’ level; testament to the

dedication of our business to driving alignment with a best

practice approach to climate risk management.

We achieved “Global Sector Leader”

Status in the GRESB Development

Benchmark

NewRiver has been recognised by GRESB as a Global Sector

Leader in the category of hotel development, following the

completion of our Romford Premier Inn project which achieved

BREEAM New Construction certification. This development

delivered on our key ESG targets, including to measure and

reduce embodied carbon through the design process.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

DIVERSITY AT AGLANCE

Ethnic

diversity

(2)

17%

Mean

gender pay gap

34%

FY22: 30.6%

Median

gender pay gap

29%

FY22: 33.2%

Board

Male:Female ratio

71:29

FY22: 71:29

Exco

Male:Female ratio

60:40

FY22: 60:40

Company

Male:Female ratio

53:47

FY22: 51:49

Our Commitment to Diversity,

Equity & Inclusion (DEI)

As a company, we are committed to a culture of diversity and

inclusion in which everyone is given equal opportunities to progress

regardless of gender, race, ethnic origin, nationality, age, religion,

sexual orientation or disability. We continue to strive to provide the

most flexible employment policies to enable all of our employees to

combine a fulfilling career with an active home life.

Equal Opportunities

We have recently updated our Equal Opportunities policy to provide a

comprehensive standalone policy statement which clearly communicates:

• What we regard as acceptable and unacceptable behaviour at

work;

• The rights and responsibilities of those to whom the policy applies;

• The procedure for dealing with concerns or complaints;

• How we will deal with any breach of our policy;

• Who is responsible for the policy; and

• How it will be implemented, monitored, and reviewed.

All staff will shortly receive externally delivered training to ensure full

understanding of this policy, including types of discrimination and

unconscious biases, to support its effective implementation.

Board Diversity

As part of the policy review process which produced our updated

Equal Opportunities Policy, we have also developed a new Board

Diversity Policy, which includes the following objectives:

• At least two members of the Board are female, with a long-term

aspiration to achieve no less than 40% female representation on

the Board; and

• In the longer-term, at least one director will be from a non-white

ethnic minority background.

Whilst recognising that:

• This balance may not be achieved until further Directors are

replaced at the end of their tenure;

• On an ongoing basis, periods of change in Board composition may

result in temporary periods when this balance is not achieved;

• All appointments must continue be made on merit;

• And new appointees embody the core values of the Group.

Gender Pay Gap

Last year, we took the decision to begin publishing our gender pay

gap information. As we have fewer than 250 employees, we are not

obliged by The Equality Act 2010 (Gender Pay Gap Information

Regulations 2017) to disclose our gender pay gap, however we are

pleased to provide our disclosure below in support of our

commitment to DEI.

This represents a 3% increase in our mean gender pay gap since our

first disclosure, and a 4% decrease in our median gender pay gap.

These fluctuations are driven by differences in the roles and seniority

levels of male and female leavers and joiners to NewRiver over this

period.

In interpreting this gender pay gap disclosure, it is important to note

that this is not a calculation of equal pay for equal work. The gender

pay gap is the difference between the average annual salaries of

men and women across all levels of the company, excluding any

bonuses or other benefits received. The comparison is drawn across

all departments of the business, spanning all levels of seniority. We

adopt a strict equal pay for equal work policy, ensuring that all

remuneration is managed in compliance with equality legislation.

(January 2022 - December 2022)

(1)

1. Comparables refer to previous reporting period for FY22, 1 April 2021 to 31 March 2022.

2. Not disclosed in FY22

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Employee Social Performance Measures

EPRA Code Performance Measure Unit(s) of Measure Boundary FY23

FY22

Diversity-Emp

Employee gender diversity Percentage of employees,

Board diversity

NewRiver Board 29% female/

71% male

29% female/

71% male

Percentage of employees,

Allemployee gender diversity

NewRiver

direct employees

47 % Female/

53% Male

49% female/

51% male

—

Employee racial diversity Percentage of employees,

Allemployee racial diversity

84% White/9%

Asian/1%

Caribbean/ 5%

Mixed/1 % Moth

88% White/ 8%

Asian/ 2% mixed/

2% Moth

Diversity-Pay

Gender pay ratio Ratio of gender pay,

mean/median

34% Mean/

29% Median

30.61% Mean/

33% Median

Emp-Training

Employee training

and development

Average hours/employee 26 23

Employee training, subscriptions,

surveys, and online platforms

Total £s invested £142,492 £159,202

Employee health

& safety training

Average hours/ employee 2 0

Emp-Dev

Employee

performance appraisals

Percentage of employees 100% 100%

Emp-Turnover

Total number of new hires Total number 2 5

Total number of leavers Total number 9 5

Rate of new hires Percentage 4% 10%

Rate of employee turnover Percentage 15% 0%

—

Temporary staff Percentage of employees

who are contractors or

temporary staff

0% 0%

H&S-Emp

Injury rate Per 100,000 hours worked 0 0

Lost day rate Per 100,000 hours worked 0 0

Absentee rate Days per employee 0 0

Fatalities Total number 0 0

—

Instances of non-compliance

with labour standards

Total number 0 0

1. 12-month period ending 31 December 2022

2. FY22 figures include the employees of Hawthorn Leisure

3. As we have fewer than 250 employees, we are not obliged by The Equality Act 2010 (Gender Pay Gap Information Regulations 2017) to disclose our

gender pay information. We calculate gender pay gap based on the difference between the average annual salaries of men and women, excluding

bonuses and other benefits.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Engaging our Occupiers

Occupier satisfaction is a core priority of our business; as such, we undertake routine surveys to gain insight into occupier opinions on material

topics such as the service-mindedness of our centre management teams and our sustainability programme.

The opportunity to respond to our 2022 survey was offered to 100% of our occupiers, and we received a total of 415 responses. Our next

survey will be undertaken in the autumn of this year.

We also received some helpful, constructive feedback which we would like to take this opportunity to respond to:

Feedback Item NewRiver Response

60% of retailers would be interested

to hear more from us on the overall

sustainability performance of their

individual centre.

We are working with our energy brokers to create a platform capable of storing and presenting

sustainability performance data for both the landlord and occupier areas of our portfolio. The

success of this solution will require collaboration with our occupiers, and we are hopeful that

this will deliver helpful insights to support a reduction in our collective environmental impact.

Our retailers advised us that they

would welcome more opportunities

to charge electric vehicles.

We currently have 123 new charging bays in the pipeline for near-term delivery across our

portfolio. We will also review further opportunities as part of the Green Travel Plan milestone

on our net-zero pathway (2024).

We also received some suggestions

from our occupiers as to appropriate

new uses to introduce at our centres

We ensure our assets provide a mix of convenience, value and services for customers’ everyday

needs, whilst also using space to support and raise awareness of local charities. The feedback

we receive through our occupier survey is invaluable to us in being able to achieve and maintain

this position.

KEY INSIGHTS

from our 2022 survey include:

86%

of retailers agree that their centre

manager is easily contactable,

responsive, and that general

communication is timely and effective.

89%

of respondents are satisfied with the

management of cleaning and waste

in common areas

Most of our occupiers are satisfied

with the various community events we

host throughout the year, as well as the

initiatives we implement to support the

elderly and people with disabilities

67%

of respondents rated their general

satisfaction as 8/10 or higher,

with 26% providing a rating of 10/10

82%

of retailers agree that improving the

sustainability performance of their

business is important, with over 64%

rating it as “very important”

Most of our occupiers are satisfied with

the sustainability initiatives we implement

at our centres

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Carving a collective pathway to Net-Zero

1. Correct as of September 2022

In FY23 our support for the Trussell Trust provided:

158.5 hours

of volunteered support, with a

total value of £2,550*

4.5 tonnes

of food donations, once again this equates to approximately 59,300

portions or £8,900 worth of pasta, enough dinners for....

40 families of 4

for a whole year

£125,633

of direct monetary donations in FY23

£66,320

raised by over 30 NRR team members running 10k

* Based on the national TOMs Framework proxy value for voluntary

hours donated to support VCSEs (excluding expert business advice)

of £16.09 per hour

This year, to inform our occupier engagement strategy as part of our

journey to becoming a net-zero carbon business, we have

undertaken a review of our occupiers’ sustainability commitments

and emissions reduction ambitions, to understand current levels of

alignment and identify key areas in which to focus our engagement

efforts.

In reviewing occupier commitments, we were encouraged to learn

that 57% of our portfolio by floor area is occupied by retailers who’ve

already set emissions reduction targets, with a further 3% having

disclosed that they are in the process of developing targets

. Of the

57% occupied by retailers with existing commitments, 70% is

occupied by BRC Net-Zero Roadmap signatories. These

organisations have committed to work together with other retailers,

suppliers, government, and other stakeholders to bring the UK retail

industry’s emissions to net-zero by 2040.

We continue our important partnership with The Trussell Trust,

donating direct funds, time and physical space to help the charity work

toward its vision for a UK without the need for food banks.

Staff are able to participate in monthly volunteering opportunities with

our corporate charity partner, the Trussell Trust, or elect to utilise their

gifted volunteering time to support any cause that’s particularly close

to their hearts.

In June 2022 over 30 NewRiver team members each ran 10km raising

£66,320, well exceeding our target of £30,000, for the Trussell Trust.

57%

40%

70%

Commitment in development

No Commitment

Commitment Made

Occupiers committed to BRC

Occupier carbon emission reduction targets

176

124

Trussell Trust donations 2018-2022 Per £000

2022 20232019 2020 2021

176

124

Trussell Trust donations 2018-2022 Per £000

2022 20232019 2020 2021

£450k

of direct monetary

donations to date since our

partnership with the Trussell

Trust began in June 2019

We were very pleased to learn, therefore, that the majority of our

occupiers share our sustainability vision. This exercise was also

helpful to us in understanding key areas in which we might be able to

offer insight and learnings to our occupiers as we work to achieve our

own net-zero targets. In particular, we hope to be able to support our

SME occupier base on this journey.

Having formalised our policy and framework for measuring embodied

carbon across our development and major refurbishment projects,

including lifecycle carbon targets reflective of industry best-practice

guidelines, we will shortly be providing guidance to our occupiers for

selecting materials in the fit-out and property maintenance processes

which reduce the embodied carbon impact of works.

Our Partnership with The Trussell Trust

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Asset Social Performance Measures

EPRA Code Performance Measure Unit(s) of Measure Boundary FY23 FY22

H&S-Asset

Asset health and safety

assessments

Percentage of assets

Managed Assets

100% 100%

H&S-Comp

Asset health and safety

compliance

Number of incidents

in reporting year

0 0

Development and major

refurbishment project health

and safety compliance

Number of incidents

over past 3 years

0 –

Comty-Eng

Community engagement,

impact assessments and

development programmes

Percentage of assets 100% 100%

A Mission for a Merry Christmas

Locks Heath Shopping Village in Fareham supported its local

‘Mission Christmas’ event during the festive period, where over

200 gifts were donated by the local community and employees.

These donations, along with others, were distributed to nearly

70,000 children and teens across the south coast who

otherwise wouldn’t have received a gift on Christmas Day.

A Hole in One for Local Charities

Customers at the Ridings Centre, Wakefield supported their

favourite local charities, whilst testing their sporting prowess, by

trying to “get a hole in one” using their spare change at a

mini-golf themed donation point. Depending on where the coins

land, they are donated to one of four charities: The Trussell

Trust, Age UK, Wakefield Hospice, or Wakefield Street Kitchen.

AT OUR CENTRES

Supporting our Communities

Supporting impactful local causes through the position we hold in our communities has

always been central to our culture and strategy of creating shared value for our stakeholders.

In 2022, we updated our volunteering policy to provide NewRiver-funded time for our staff to support causes which

matter most to them, and to share team bonding opportunities in doing so.

598

hours spent by on-site

staff supporting

community initiatives

£87,124

Monetary donations raised

by aggregatecharity

fundraising activities

259

social, community

or charitable

initiatives supported

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Our Governance of Sustainability and Climate-Related Matters

Our purpose is to buy, manage and develop retail assets across the UK which provide essential goods and services, supporting the

development of thriving communities.

Our Board recognises our responsibility to ensure our portfolio can weather the physical and transitional risks created by a changing climate to

ensure the long-term resilience of our business and the returns we achieve for our investors, as well as the all-important communities we serve.

Governance Performance Measures

EPRA

Code

Performance

Measure

Unit(s) of Measure FY23

FY22

Gov-

Board

Composition of the highest

governance body

Number of executive

board members

2 2

Number of independent/

non-executive board

members

4 4

Average tenure on the

governance body

3.6 4.1

Number of independent/

non-executive board

members with

competencies relating

to environmental and

social impacts

4 2

Gov-

Selec

Process for nominating

and selecting the highest

governance body

Narrative on process As a Stock-Exchange-Listed business, NewRiver is required under the

UK Corporate Governance code to have a Nomination Committee which

is responsible for identifying and nominating candidates to the Board.

Please refer to page 109 for the latest report from the NewRiver

Nomination Committee.

Gov-

Col

Process for managing

conflicts of interest

Narrative on process As a Stock-Exchange-Listed business, NewRiver is required under the UK

Corporate Governance Code to identify and manage conflicts of interest.

Directors also have duties under the Companies Act 2006. To manage this

process, the Company Secretary keeps a register of all Directors’ interests.

The register sets out details of situations in which each Director’s interest

may conflict with those of the Company (situational conflicts). The register is

reviewed at each Board meeting so that the Board may consider and

authorise any new situational conflicts identified. At the beginning of each

Board meeting, the Chairman reminds the Directors of their duties under

sections 175, 177 and 182 of the Companies Act 2006, which relate to the

disclosure of any conflicts of interest prior to any matter that may be

discussed by the Board.

There is also a staff conflicts of interest policy in place which requires any

potential conflicts to be kept on a register and regularly updated. This is

reviewed by the Audit Committee on a six-monthly basis.

–

Board oversight of

code of conduct

Narrative on process The Company has a code of conduct that is included in the staff handbook.

Non-compliance would be a staff disciplinary matter. The Board, through its

Audit Committee has oversight of non-compliance. The Company also has a

whistleblowing policy and process which is regularly reviewed by the audit

committee. There have been no instances of non-compliance.

–

Due diligence of

partner organisations

Narrative on process The Company has an onboarding process for suppliers and a supplier’s

code of conduct. The Company also has a Modern Slavery policy. Suppliers

are required to confirm that they agree to this Modern Slavery policy as part

of the on-boarding process.

–

Anti-corruption

measures

Narrative on process The Company has an Anti-bribery and anti-corruption policy. As part of this

policy there is a gifts and hospitality approval process and register.

A conflicts of Interest policy is also in place as well as a whistle-blowing

policy and process.

–

Fines and settlements

in connection with

non-compliance with

environmental, anti-bribery/

corruption, or other ESG-

related regulation

Total GBP of fines in past

three years, type of

non-compliance

£0, no incidences of non-compliance

1. 12-month period ending 31 December 2022

2. 12-month period ending 31 December 2021

GOVERNANCE

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

TCFD: our journey

toclimateresilience

NewRiver’s Board recognises the importance of adopting a sound

framework that supports the business to enhance the resilience of

our assets against the impacts of climate change.

NewRiver is committed to embedding the recommendations of the

Financial Stability Board’s Task Force on Climate-related Financial

Disclosures (TCFD) within our approach to climate-related risk

management. This disclosure aims to present a transparent account

of our processes designed to support our journey towards a

low-carbon business model, structured around the TCFD’s four

recommendation pillars: Governance, Strategy, Risk Management,

and Metrics and Targets.

Our 2023 disclosures represent our fifth consecutive TCFD report.

We consider that the following report is consistent with all of the

TCFD’s recommendations and recommended supporting disclosures;

these being the four pillars referenced above, and the eleven

disclosures within, which are signposted throughout this report. The

Governance

TCFD Governance Recommendation ‘a’: Describe the board’s oversight of climate-related risks

and opportunities

Our Board takes ultimate responsibility for our business’ resilience against climate issues and the transition of our portfolio to a low-carbon

operating model. Material climate issues are considered by the Board when reviewing NewRiver’s strategic approach to managing

associated impacts on the day-to-day operation of our assets, to preserve our ability to create value for our investors and communities.

Allan Lockhart, our Chief Executive and senior Board Director, retains overall accountability for our ESG programme and approach to

climate matters.

The Board’s oversight is supported by the ESG Committee, led by our Head of Asset Management and ESG, Emma Mackenzie. The

Committee meets quarterly to oversee NewRiver’s approach, which is guided by our Pathway to Net-Zero, whilst reviewing and ensuring

that appropriate resources are mobilised to enable proactivity. The Committee provides quarterly briefings to the Board, updating its

members on key milestones achieved by the ESG programme.

The Board and the Audit Committee adopts an integrated risk management approach, in which ESG and climate issues are embedded.

The Committee regularly evaluates NewRiver’s risk appetite, together with emerging and principal risks which are captured in the risk

register maintained by the Company. The Committee considers a range of risks across six risk categories, linked to our business model,

strategic priorities, and external environment. Climate-related risk represents one of the principal risk categories. The Committee regularly

evaluates changes to identified risks and ensures that appropriate controls are applied in alignment with the Board’s risk appetite.

During the reporting year, the Terms of Reference for our Executive Committee were updated to further clarify the role of the committee

members in managing climate-related risks as part of our ESG programme. We also appointed Dr Karen Miller to the Board as of Q1 FY23,

who has the climate-related expertise required to have specific responsibility for ESG matters across the business.

The Board received ESG training in FY22, including climate-related issues, and determined that additional ESG training would not be

required annually particularly given the strengthening of the Board in this area through the expertise of Dr Karen Miller. However, the

requirement for ESG training to the Board will be considered annually. The Board routinely considers the impact of climate-related issues

on the business, its assets and strategy throughout the year with key matters of concern or opportunity being escalated to the Board via

the CEO and ESG Committee; one example of this is the cost to the business to ensure the assets in England & Wales are MEES compliant

in line with the recent change to legislation.

TCFD Governance Recommendation ‘b’: Describe management’s role in assessing and managing

climate-related risks and opportunities.

Senior management is closely involved in our day-to-day approach to climate issues. Through her dual role as Head of Asset Management

and ESG, Executive Committee member Emma Mackenzie regularly engages with asset and property management teams to ensure

appropriate energy and carbon management processes and policies are integrated within all management activities.

In addition, asset and property management teams interact with centre management to ensure that policies are implemented across the

portfolio and that performance is tracked through our ESG programme. Quarterly performance updates are provided to the Board via the

ESG Committee.

Our internal teams and centre managers have all received ESG training during the year, delivered by our external consultants. We invest in

these sessions to ensure that management personnel are kept abreast of the latest developments in sustainability best practice and

evolving climate-related issues.

The Remuneration Committee includes an ESG objectives as part of the bonus objectives for both the Board and the Executive

Management. This is a pre-defined percentage of bonus with a high degree of measurability, and forms part of the overall performance

assessment for management.

TCFD’s Guidance for All Sectors has been considered in order to

achieve this stated level of consistency with the recommendations.

We also commissioned GRESB’s independent review of our 2022

TCFD disclosures and were awarded an “A” alignment rating. This

review will be continuously evolving and we acknowledge the areas

for further improvement, such as enhanced granularity of our

disclosure in connection with the TCFD’s Strategy recommendation,

which will be supported by the commissioning of costed net-zero

plans for our assets (see page 86).

We continue to develop our capabilities and explore new methods

and technologies to support our response to emerging climate-

related risks. We have recently commissioned a portfolio-wide

assessment of physical climate-related risks, including how exposure

levels may change under different warming scenarios. We are also

focusing on deepening our understanding of our Scope 3 emissions

to reduce reliance on estimations in the way we account for them, for

example, in connection with the Scope 3 category of Downstream

Leased Assets, for which we are currently exploring a technology

solution via our energy brokers.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Strategy

TCFD Strategy Recommendations ‘a’ and ‘c’:

Describe the climate-related risks and

opportunities the organisation has identified

over the short, medium, and long term; and

describe the resilience of the organisation’s

strategy, taking into consideration different

climate-related scenarios, including a 2ºC or

lower scenario.

NewRiver considers climate-related risks, as well as opportunities,

that may arise from both the physical impacts of climate change and

the transition of our managed assets across the UK to a low-carbon

operating model. We identify climate-related issues across short,

medium, and long-term horizons, appropriately defined to inform

our ESG and corporate strategies.

We have identified relevant short-range and long-range time horizons

separately for transition risks and physical risks due to both the

nature of the potential risks, our expectations for how they will

change over time, and the way in which we assess and manage them

as a business. We anticipate that relevant transition risks are likely to

be susceptible to a higher degree of change over a shorter period,

and so the transition risk time horizons we consider are:

Short:

<5 years

Medium:

5-15 years

Long:

>15 years

Physical risk time horizons are based on the IPCC definitions of short,

medium, and long-term climate models, which represent equal

20-year periods up to 2100. These periods have been used to assess

the exposure of our portfolio to climate change under three warming

scenarios, including a within 2oC scenario. The physical risk time

horizons we consider are::

Short:

2021-2040

Medium:

2041-2060

Long:

2081-2100

Our strategy is designed to enable us to build resilience

considerations into the acquisition and operation of our assets as an

integral part of our overall approach to asset management. As our

portfolio consists of assets located in the UK only, there is little

variation in exposure levels to both transitional and physical risks

andopportunities across our assets. Our net-zero pathway and

theinterim targets we have set ourselves guide our approach to

remaining resilient to principal transition risks (refer to table on

page82). The findings of our physical risk assessment and sensitivity

analysis using low and high carbon scenarios show that there is very

little change to the exposure of our portfolio to physical climate risks

in the best and worst case scenarios (refer to table on page 85),

withoverall risk being relatively low.

Transition Risks & Opportunities

The table on page 82 outlines the principal transition risks we have

identified and the ways in which we expect their relevance to

NewRiver to evolve over the defined time horizons. Our assessment

considers risks and opportunities associated with keeping warming

to within 1.5-degrees above pre-industrial levels - as our strategy is

based on this objective – and therefore assumes that the end date

for achieving net-zero is 2050.

Generally, we consider that exposure to Policy & Legal, Technology

and Market-related risks is likely to peak in the medium-term, whilst

the reputational risk posed by an ineffective response to climate

change is assessed to remain relatively constant, although the

necessary actions to achieve an effective response will naturally

increase, which is reflected in the gradually broadening scope of

our emissions reduction targets over this period.

Should collective efforts to keep warming to within 1.5-degrees

prove insufficient, all transition risks have the potential to have a

further heightened impact, as regulatory targets may need to

increase to keep the UK economy on the required decarbonisation

pathway, which may also increase the costs associated with aligning

buildings’ performance to such targets. In this scenario, the need to

take prompt action would be even more critical, and the importance

to consumers of an effective response would also grow. As our

transition strategy is aligned to the best available scientific

recommendations and our approach to the sustainable management

of our assets strives for continuous environmental performance

improvements, we do not envisage that we need to amend our

transition risk management strategy based on different scenarios.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Term Impact Probability Relevance to NewRiver

Climate Change Strategy (Risk 4a

A failure to implement appropriate climate risk management measures, comply with evolving regulations and meeting our ESG targets could

impact the operation and value of our assets, leading to a risk of asset obsolescence, reputational damage and erosion of investor value

Policy & Legal

Energy

efficiency

and carbon

regulations

relating to

managed

assets

Evolving policy designed to

support the UK’s 2050 net-zero

commitment presents resource

requirements to manage

compliance efforts but also

highlights opportunities to r

educe costs through energy

efficiency and the transition of

assets to a low-carbon operating

model, improving resilience.

Short

High We have mitigated the short-term MEES

risk associated with our portfolio by

ensuring no breaches of the 1 April 2023

change to the regulations. All of the let

units across our operational control

portfolio have an EPC rating of “E”

or better

Medium

High MEES risk has the potential to increase

with the introduction of more ambitious

thresholds proposed from 2027. There is

also potential for ‘energy-in-use’ ratings

to emerge

Long High New regulatory measures may emerge as

we move closer to the Government’s

2050 target. We prepare to remain

resilient to such measures through our

own net-zero strategy and delivery plan

Technology

Costs to

transition

managed

assets to

low-carbon

model

Opportunities exist to implement

a range of technologies designed

to improve environmental impact

and efficiency, supporting our

net-zero commitments.

Short High We are in the assessment phase of

most technology solutions at this stage

on our net-zero pathway, with

implementation being focussed on

key strategic opportunities

Medium

High We will be in the core implementation

phase of our net-zero pathway

Long

High We envisage that the majority of the

transition will occur in the medium term

however technology evolves rapidly,

and new opportunities may continue

to materialise

Reputation

Avoid

stigmatisation

based on

ineffective

response

to climate

change

We must continuously work

towards, and monitor our

progress against, our SBTi

approved emissions reduction

targets. Key milestones

consistent with a 1.5-degree

future include our 2030 and

2050 targets. Requirement to

ensure that any offsets

purchased as part of our

strategy are additional, not

overestimated, lead to permanent

removals, do not support double

counting, and do not cause wider

social or environmental harm.

Short High We have committed to becoming a

net-zero business and developed our

pathway to achieving this commitment.

Our corporate net-zero commitment falls

within this time horizon (2025)

Medium

High We have committed to reducing absolute

emissions by 42% by 2030, consistent

with a 1.5-degree warming trajectory

Long

High By 2040, the common areas of our

portfolio will be operationally net-zero.

By2050, we will be a fully net-zero

carbon organisation

1. Please refer to Principal risks and uncertainties p.93

Key

Impact and probability

Low Medium High

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Term Impact Probability Relevance to NewRiver

Climate Change Impacts on our Assets (Risk 4b*):

Changes in the way consumers live, work, shop and use technology could have an adverse impact on demand for our assets.

Market

Changing

customer

behaviour

Changes in consumer shopping

preferences present an

opportunity to leverage our

ESG strategy to demonstrate

the ways in which we actively

cater to the evolving needs

of customers.

Short Medium Our assets support sustainable travel

options and engage occupiers &

customers in our ESG programme

Medium

High Customer preferences for environmentally

friendly products and services are likely

to increase in the medium-term. Our

strategy is designed to keep pace with

this evolution

Long High In the long term, we envisage that there

will be less distinction between the

environmental credentials of different

products and services, as we move closer

towards a decarbonised economy

1. Please refer to Principal risks and uncertainties p.93

We have reduced our total scope 1&2 emissions by 12% since our baseline year, which represents an annual rate of reduction consistent with

achieving our 2030 target to reduce these emissions by 42% in absolute terms. Actions we have taken over the past 12 months in order to

identify opportunities to ensure we continue on this pathway, which underpins our management of transition risks, include:

Management of transition risks

Policy & Legal

Re-assessments of all of the units across our portfolio with F-G rated EPCs, to achieve an up-to-date

and accurate view of our exposure to MEES-related risks and the potential financial implications.

Following the re-assessments, we have been able to confirm that our operational control portfolio

aligns with the 1 April 2023 MEES requirement for all let properties to have a minimum energy

performance rating of “E”. Proposals exist to increase the minimum threshold to “C” by 2027, and

we are commissioning further assessments to ensure we have full coverage of certifications across

our portfolio so we can assess the potential cost impact of this heightened standard.

Technology & Reputation

Commissioning a degasification study of our highest consuming asset to understand options for

transitioning it to a fully electric system supported by on-site renewable energy generation. This

study has provided valuable insights as to the opportunities and challenges of this approach, which

we will assess in detail alongside the findings of a series of energy audits to be undertaken this

year pursuant to ESOS (Energy Savings Opportunity Scheme) Phase 3. Together, these studies will

inform an optimum, costed, solution and timescale for feasibly reducing the energy demand of our

portfolio in a targeted manner. Alongside this, we have also invested in a Smart Building Platform

(IBOS) which optimises HVAC and other building systems to provide the actionable insight required

to improve performance. We are also evaluating a technology solution to gathering data on our

Scope 3 emissions category of Downstream Leased Assets.

Market

The continuous review process enabled by our Environmental & Social Implementation plans

ensures we are catering to the evolving needs of customers. Key ways we have demonstrated this

include by introducing additional EV charging infrastructure at our assets and hosting biodiversity-

focused community engagement initiatives, whilst also seeking to understand the sustainability

objectives of our occupier base. We are also in the process of evaluating key opportunities to

achieve green building certifications for our assets.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Physical Risks & Opportunities

The table on page 85 depicts the principal climate hazards we have

identified to berelevant to NewRiver’s portfolio and the extent to which

exposure levels are projected to change over time under high and low

carbon future scenarios. The assessment modelled three climate

scenarios in total: SSP1-2.6, a low carbon scenario corresponding to

approximately 2°C of warming at the end of the century, SSP2-4.5, an

in-between scenario available for some specific climate hazards, and

SSP5-8.5, a high carbon scenario corresponding to approximately 4 to

5°C warming at the end of the century. The figure presents the findings

of the SSP1-2.6 and SSP5-8.5 scenarios, with each hazard shaded

based on the % of NewRiver’s portfolio which is assessed to be highly

exposed.

Our assessment considered 11 key climate hazards including

temperature-related, wind-related, water-related, and solid mass-

related hazards. Through the analysis, cooling degree days and heat

waves have been discounted as relevant risks to our portfolio, with

100% of our assets having no to low exposure. All assets are

considered to have a medium exposure to heavy precipitation as this

is a key hazard for the UK as a whole. Exposure is not anticipated to

change under the assessed scenarios/time horizons. Wildfire

exposure was also considered as it’s an emergent hazard. Whilst not

a key hazard in current conditions, it is generally expected to become

more relevant in future. The analysis showed that none of NewRiver’s

sites are highly exposed to wildfire risk and that exposure levels are

not anticipated to increase over time or under different scenarios.

Heat stress (defined based on a comparison between maximum

future temperatures and temperatures experienced in the same

location in the past, i.e., not global categorisation) has been included

to capture the relevance of anticipated increases in higher

temperatures for the UK. While exposure to heatwaves has been

discounted as a material risk to NewRiver in absolute terms (global

categorisation), an increase in maximum temperatures is a key hazard

for the UK given the projected significant increase in intensity and

frequency, which is relevant to the preparedness of UK buildings.

The assessment therefore concludes that all assets in the UK have a

high potential to be exposed to heat stress, however this conclusion

is not asset-specific and actual risk depends on individual assets.

Alongside storm hazards, heat stress will be further evaluated as

appropriate in the context of each asset’s overall strategy and the

relevant time horizon.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Low Carbon Scenario High Carbon Scenario

Short

2021-2040

Medium

2041-2060

Long

2081-2100

Short

2021-2040

Medium

2041-2060

Long

2081-2100

Summary of

hazardexposure

Summary of

hazardimpact

Heat stress

Same level of exposure

as all buildings in the

UK, as asset-specific

analysis has not

been undertaken.

The potential impact of this hazard on

our assets is higher cooling, and

therefore energy, demand. Increased

energy demand in turn increases

operational and maintenance costs.

Water stress

No change in exposure

levels for scenario/ time

horizon over which data

is available. Exposure

level is never more

than 20%.

Water stress is pressure on the quantity

and quality of available water resources.

Prolonged water stress can have a

negative impact on public health and

economic development.

Storm

No significant changes

in exposure over time

and scenario. Range is

between 59-65%.

Storms are identified as a key current

hazard for our portfolio, with the

potential impact being damage to

external building elements. We

undertake building safety assessments

which review the risk of loose roof/

facade features, which support

mitigation of this risk.

Wind

Very minor increase

in exposure over time

and scenario but never

exceeding 5%.

The potential impact of this hazard is

closely linked to the above commentary

regarding storm damage.

Subsidence

No data to assess

exposure in future

scenarios, so short-term

low carbon scenario

represents exposure

under current climate

conditions.

Increases in other climate hazards

such as flooding could increase the

likelihood of subsidence. This poses a

risk of damage to properties.

Coastal flood

Very minor increase

in exposure over time

independent of scenario

(15-20%), but high carbon

scenario accelerates

the increase.

As with storms and subsidence,

flooding has the potential to cause

damage to structural building elements,

but also to goods stored within our

assets. We maintain a flood risk register

to monitor risk exposure and identify

any need for intervention measures.

Our assets are insured against this risk.

Fluvial flood

Constant low exposure

over time (11%). Data

only available for high

carbon scenario.

ChronicAcute

Unavailable 20-40% 60-80%

0-20% 40-60% 80-100%

3. Flexible

Balance Sheet

TCFD Strategy Recommendation ‘b’: Describe the impact of climate-related risks and opportunities

on the organisation’s businesses, strategy, and financial planning.

Risk Management

1. Disciplined

capital allocation

2. Leveraging

our platform

1. Disciplined capitalallocation

Embed Net-Zero Carbon and climate resilience in due diligence

and analysis of stock selection from 2022

2. Leveraging ourplatform

• Prepare costed asset

management plans to

net-zero for all managed

assets by 2024

• Actively engage with our top

30 occupiers to align our level

of commitment

• Actively apply green lease

commitments across all

occupier transactions

• Actively engage NewRiver’s

top tier suppliers to align

commitment for products

and services purchased to

mitigate supply chain

emissions

• Actively pursue procurement

of renewable energy across

all landlord and occupier

space

• Adopt NewRiver’s

re-development &

major refurbishment

ESG framework across

all relevant projects

• Measure the embodied

carbon emissions of all

re-developments & major

refurbishments by undertaking

‘Life Cycle Assessments’

(LCA), from 2023

• Embed minimum fit-out

requirements for occupier

licenced fit-outs from 2021

• Design out fossil fuels from all

major refurbishment projects

and re-development projects

with immediacy

• Leverage our strong

relationships with UK high

street retail brands, local

councils, and our joint venture

partners, to ensure efforts are

collaborative and long-term

• When managing assets

owned by third parties,

leverage our scale, expertise,

and learnings on our journey

to net-zero, to promote

environmental best practice

beyond our own portfolio

3. Flexible balancesheet

Leverage the flexibility of our balance sheet to ensure investment in

energy efficiency over the next 20 years is well accounted for in

financial planning and that the value of our investments is protected

from current and future market & legislative risks

The Board has a low risk tolerance for principal risks affecting our

business, including climate-related issues. Consistent with this appetite,

our robust ESG programme guides our actions on our pathway to

net-zero and supports our response to climate-related issues through

the implementation of asset-level initiatives designed to improve

efficiency, reduce environmental impact, and enhance resilience.

We have embedded ESG and climate considerations throughout our

business processes, departments, and functions. Environmental

considerations are embedded into capital allocations and are

considered for all future acquisitions. The following diagram depicts

the actions and processes we have identified as part of our strategy

to deliver on our climate ambitions in the context of our business

model and financial planning.

Please see our business model on page 18

TCFD Risk Management

Recommendation ‘a’: Describe

the organisation’s processes for

identifying and assessing

climate-related risks.

Climate-related risks are identified through

NewRiver’s integrated risk management

framework. Our risk management framework

considers both emerging and principal risks

with the potential to impact our business. We

maintain a risk register that considers a range

of categories, including environmental and

climate change risks. The risk register

assesses the impact and likelihood of each

identified risk, which is translated into a risk

heat map. Where the residual risk does not

align with the Board’s risk appetite,

management actions are recommended

with a view to mitigating the relevant risk.

TCFD Risk Management

Recommendation ‘b’: Describe

the organisation’s processes for

managing climate-related risks.

Accountability for mitigating actions is

assigned to a senior asset and property

manager. This approach allows NewRiver to

ensure there is a top-down understanding of

principal risks across the business, backed by

bottom-up mechanisms to support monitoring

by management and their ability to address

principal risks in a timely manner. With the

support of our centre managers, we implement

a host of initiatives designed to manage

environmental impact and promote the

efficient operation of our assets.

TCFD Risk Management

Recommendation ‘c’: Describe how

processes for identifying, assessing,

and managing climate-related risks

are integrated into the organisation’s

overall risk management.

Please see pages 89-91 for a detailed

presentation of how the identification,

assessment and management of climate-

related risks are integrated into NewRiver’s

overall risk management processes.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Our ESG approach continued

Metrics and Targets

TCFD Metrics and Targets Recommendation ‘a’:

Disclose the metrics used by the organisation to assess

climate-related risks and opportunities in line with its

strategy and risk management process.

Annually, we disclose a suite of climate-related metrics which

track our performance towards realising our core objective of

minimising our environmental impact. These metrics are aligned

with EPRA’s best practice recommendations for transparently

disclosing sustainability performance. The EPRA performance

tables on pages 65-66 present our FY23 performance across

these metrics, alongside historical performance.

We guide action towards making positive progress against these

metrics using a set of short, medium and long-term targets,

detailed on page 61. These targets are aligned with the UN

Sustainable Development Goals to which we have committed,

including SDG 13, Climate Action.

Physical climate risks are monitored in terms of the % of our

portfolio which is considered to be highly exposed to emergent

hazards (see page 85). This is a monitoring metric we have

introduced during the reporting year, with the appropriate

ongoing monitoring frequency under consideration. We also

maintain a separate flood risk register on an ongoing basis.

TCFD Metrics and Targets Recommendation ‘b’:

Disclose Scope 1, Scope 2, and, if appropriate, Scope 3

greenhouse gas (GHG) emissions, and the related risks.

In accordance with our reporting obligations under the UK’s

Streamlined Energy and Carbon Reporting regulations, we

disclose our annual carbon emissions performance. Please refer

to pages 63-64, where we provide further information on our

FY23 emissions performance, together with a comparison

against our historical performance and the methodologies used

to prepare these disclosures. Methodologies used are

consistent with the WBCSD (World Business Council for

Sustainable Development)/WRI Greenhouse Gas (GHG) Protocol

Corporate Accounting and Reporting Standard and capture all

Scope 3 emissions categories identified as material to our

business.

Specific metrics used to monitor the principal transition risks identified are as follows:

Metric(s) Monitoring Frequency

Policy & Legal

Energy efficiency and carbon

regulations relating to managed assets

Portfolio EPC Profile Continuous

Technology

Costs to transition managed assets to

low-carbon model

Energy usage intensity Monthly

Reputation

Avoid stigmatisation based on

ineffective response to climate change

Scope 1, 2 & 3 GHG emissions Annual quantification with monthly

monitoring through energy management

Market

Changing customer behaviour Customer engagement via Centre

Management teams

Quarterly

TCFD Metrics and Targets Recommendation ‘c’:

Describe the targets used by the organisation to

manage climate-related risks and opportunities and

performance against targets.

Following the release of the Science Based Targets initiative’s

(SBTi) Corporate Net-Zero Standard in October 2021 – the

world’s first framework for corporate net-zero targets consistent

with a 1.5°C future – we have published our Pathway to Net-Zero

and have received validation from the SBTi for our Scope 1 and

2 emissions reduction targets.

Science-based targets (SBTs) provide companies with a clearly

defined pathway to future-proof growth by specifying how much

and how quickly they need to reduce their GHG emissions to

achieve a net-zero world by no later than 2050. Pragmatic

net-zero strategies place the corporate SBT methodology at

their heart, prioritising rapid decarbonisation before the use of

carbon offsets. This is the approach that we will take in pursuing

the following targets:

1. Our corporate emissions will be brought to net-zero by 2025

2. We will achieve a 42% reduction in total absolute emissions

by 2030*

3. Our landlord-controlled portfolio emissions will be brought to

net-zero by 2040

4. Our tenant-controlled portfolio emissions, and emissions

associated with our development activities, will be brought

to net-zero by 2050

For more information on the actions we will take to achieve

these targets, please see our Pathway to Net-Zero which

provides our detailed delivery plan. Our Pathway to Net-Zero

is presented separately on our website for ease of ongoing

access for our stakeholders.

* Against a baseline year of 2020

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Managing our risks

andopportunities

Principal risks and uncertainties

Risk is inherent in all businesses and effective risk management enables us to

manage both the threats and the opportunities associated with our strategy and

the operation of our business model.

Risk monitoring and assessment

including emergingrisks

The identification of risks and their management is a continual and

evolving process. This has been underscored more so over recent years

by the global pandemic which created uncertainty across all sectors, both

economically and socially. This has been followed with an economic

turndown and cost of living crisis which has continued the uncertainty.

Other geopolitical events such as the Russian-Ukraine crisis have also

impacted supply chains and sentiment.

The Company maintains a risk register in which a range of categories are

considered. These risks are linked to the business model and strategic

priorities of the Company. The risk register assesses the impact and

probability of each identified risk. By identifying all risks on a register and

continuously updating this register, principal risks can be identified as

those that might threaten the Company’s business model, future

performance, solvency or liquidity and reputation. Their potential impact

and probability will also be a factor in whether they are classed as

principal. The risk register also records actions that can be taken to further

mitigate the risk and each action is assigned to an individual or group.

Mitigation factors and actions are assigned to all risks whether they are

principal, non-principal or emerging.

The continuous updating of this risk register allows us to assess how risks

are evolving, assists in identifying emerging risks as they develop and

ensures that the impact of each identified risk is continually monitored as

it emerges and progresses. During the year we have identified an

emerging depositor risk as our cash holdings have built up. This risk is not

a principal risk but by identifying this emerging risk as it has developed,

we have been able to update our treasury policies to ensure that they are

fit for purpose and that cash is spread across various banking institutions.

Our small workforce encourages flexibility

and collaboration across the business in

allareas including risk management. The

accessibility and flexibility of the Board and

senior staff are particularly pertinent when

adapting to evolving risks, emerging risks

and external risks such as the aftereffects of

a global pandemic and geopolitical instability.

This flexibility enables the business to adjust

and respond to fast-changing situations and

prove its resilience and adaptability.

The Board has ultimate responsibility for

therisk management and internal controls

framework of the Company and regularly

evaluates appetite for risk, ensuring our

exposure to risk is managed effectively.

TheAudit Committee monitors the

adequacyand effectiveness of the

Company’s risk management and internal

controls and supports the Board in assessing

the risk mitigation processes and procedures.

The Executive Committee is closely involved

with day-to-day risk management, ensuring

that it is embedded within the Company’s

culture and values and that there is a

delegation of accountability for each

risktosenior management.

A Board approved counterparty list is continuously monitored using

S&Pand Fitch credit ratings. The treasury policy dictates the maximum

exposure to a counterparty based on their rating. The operation of the

treasury policy is reported to the Board on a quarterly basis. This

emerging risk has also created an opportunity as the Group has

beenable to take advantage of favourable deposit opportunities.

Risk appetite and mitigation

The Board has a low-risk appetite for compliance (legal and regulation)

related risk. The Board however recognises that the external environment

in which it operates is inherently risky. Mitigating actions are therefore

agreed for all risks that exceed the Group’s risk appetite. Our

experienced leadership team continuously works to mitigate the risks

arising from the external environment in some of the following ways:

• Maintaining an unsecured balance sheet, with the Company

benefiting from a more diversified debt structure and gaining

access to a larger pool of capital to help achieve our strategic goals

• A disciplined approach to stock selection with probability

risk-adjusted returns

• Deploying capital in joint ventures and associates,

therebydiversifying risk

• A diverse tenant base in which there is no single tenant exposure

of more than 4%

• An experienced Board and senior management

All risks on the register are ‘scored’ in terms of impact and probability.

A risk heat map can be a useful visual aid to understand the potential

impact and probability of each significant risk on a gross basis prior

tomitigation. Our heat risk map is set out overleaf.

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic ReportStrategic Report

BOARD

Collectively responsible for managing risk, overseeing the internal controls framework and determining risk appetite

AUDIT COMMITTEE

Oversees the risk management process

• Regularly reviews risks within strategy discussions, the impact of

risk on strategy and levers within the business model that can be

adjusted to manage these risks.

• Conducts formal reviews of principal risks (including emerging risks)

at least twice a year - one of which is in connection with consideration

of the viability statement.

• Monitors KPI’s which link to risk and strategy through Board reports.

• Conducts formal reviews of the risk management process twice

a year - one of which is in connection with consideration of the

viability statement.

• Monitors the need for an internal audit and appoints third parties to

test internal controls.

• Monitors the internal controls framework.

• Considers the use of external advisors for specific specialist risk

impacts and deep-dive reviews.

• Receives reports on the risk management process twice annually.

EXECUTIVE COMMITTEE

Regularly reviews the entire risk register - members are responsible for managing risk within their area of accountability

COMPANY SECRETARY

Conducts individual risk reviews with ExCo members and individual business areas.

Maintains the risk register and presents an update on the risk reviews to the ExCo, the Audit Committee

and the Board at least twice a year. Has responsibility for training staff on policies and regulations.

ASSET MANAGERS

Members are responsible for managing risk within their assets and highlighting risks as they emerge

• Conducts reviews of the entire risk register (which includes

emerging risks) at least quarterly.

• Delegates line responsibility for managing risks within their

area of accountability.

• Reviews risk topics through regular timetabled presentations

or papers.

• Uses external advisors for specific specialist risk impacts.

• Monitors KPIs which link to risk and strategy.

The Risk Governance and responsibility

Risk matrix

External risks

Principal risks

Operational risks

Movement from FY22

The risk matrix sets out gross risk (i.e. our assessment of the

impact and probability of risks prior to any mitigating factors).

All risks have mitigating actions associated with them.

Macroeconomic

Political and regulatory

Catastrophic external event

Climate change strategy

Climate change impacts

onour assets

Changes in technology

and consumer habits and

demographics

Cyber security

People

Financing

Asset management

Development

Acquisition

Disposal

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

External risks

Risk and impact Monitoring and management Change in risk assessment

during the period

1. Macroeconomic

Economic conditions in the UK and changes to

fiscal and monetary policy may impact market

activity, demand for investment assets, the

operations of our occupiers or the spending

habits of the UK population.

• The Board regularly assesses the Company’s

strategy in the context of the wider

macroeconomic environment. This continued

review of strategy focuses on positioning our

portfolio for the evolving economic situation.

• The Board and management team consider

updates from external advisers, reviewing

keyindicators such as forecast GDP growth,

employment rates, interest rates and Bank

ofEngland guidance and consumer

confidence indices.

• Our portfolio is focused on resilient market

sub-sectors such as essential retailers.

• Through regular stress testing of our

portfoliowe ensure our financial position

issufficiently resilient.

• Closely monitoring rent collection and cash flow.

• Macroeconomic risk has remained the same

during the year and is considered a medium to

high impact risk with a high probability.

• Sentiment has been impacted by the cost of

living crisis, energy cost worries and inflation.

• Overall valuations slightly decreased in the

second half of the year however due to a fully

covered dividend our covenant and policy

headroom remains high.

• Higher inflation could fuel wage growth

andcosts leading to rate increases above

current forecasts.

• The Bank of England is expecting inflation to

fall during 2023 and is working with interest

rate adjustments to reduce inflation to fall to its

2% target in around two years’ time.

Responsibility:

Board & ExCo

Link to strategy:

Impact:

Probability:

Movement:

2. Political and regulatory

Changes in UK Government policy, the

adverse effects of Brexit on our tenants,

or the impact of political uncertainty on

consumers’ retail and leisure spend.

• The Board regularly considers political and

regulatory developments and the impact they

could have on the Company’s strategy and

operating environment.

• External advisers, including legal advisers,

provide updates on emerging regulatory

changes to ensure the business is prepared

and is compliant.

• We regularly assess market research to

gaugethe impact of regulatory change

onconsumer habits.

• We carry out stress testing on our portfolio in

relation to regulatory changes which may

impact our operations or financial position.

• Where appropriate, we participate in industry

and other representative bodies to contribute

to policy and regulatory debate. Individual

ExCo members are also members of the

British Property Federation and the High

Street Task Force.

• Political and regulatory risk has remained

thesame during the year. This is considered

amedium to high impact risk with a

highprobability.

• There has been political uncertainty within the

UK due to changes in leadership and a decline

in market confidence. This is likely to continue

with a general election within the next

18 months. There have also been political

failures at a local authority level.

• There still remains some uncertainties around

the longer-term impacts of Brexit and also

uncertainties relating to the possibility of

Scottish devolution.

• The Coronavirus Act imposed a moratorium on

landlords’ ability to forfeit leases of commercial

property for non-payment of rent in England

and Wales and Northern Ireland. This

moratorium expired on 31 March 2022 and we

will continue to monitor the potential impact of

this. There are further uncertainties around the

outcome of the Government review of the

Landlord and Tenant Act 1954.

• There are also uncertainties around the impact

of the Levelling Up and Regeneration Bill.

• The long-term impact on the property market

of the Register of Overseas Entities owning UK

property is currently unclear.

Responsibility:

Board & ExCo

Link to strategy:

Impact:

Probability:

Movement:

Principal risks and uncertainties continued

Key

Risk change during FY23

Risk has increased Risk has decreased Risk has not changed

Impact and probability

Low Medium High

The Principal risks are:

External risks Operational risks

1. Macroeconomic

2. Political and regulatory

3. Catastrophic external event

4a. Climate change strategy

4b. Climate change impacts on our assets

5. Changes in technology and consumer habits and demographics

6. Cyber Security

7. People

8. Financing

9. Asset management

10. Development

11. Acquisition

12. Disposal

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic ReportStrategic Report

Risk and impact Monitoring and management Change in risk assessment

duringtheperiod

3. Catastrophic external event

An external event such as civil unrest or a civil

emergency including a large-scale terrorist

attack or pandemic, could severely disrupt

global markets and cause damage and

disruption to our assets.

• The Board has developed a comprehensive

crisis response plan which details actions to

be taken at a head office and asset-level.

• The Board regularly monitors the Home

Officeterrorism threat level and other

securityguidance.

• The Board regularly monitors advice from

theUK Government regarding pandemic

responses and emergency procedures.

• Our assets are regularly tested and

enhancedin-line with the latest UK

Government guidance.

• We have robust IT security systems which

cover data security, disaster recovery and

business continuity plans.

• The business has comprehensive insurance in

place to minimise the cost of damage and

disruption to assets.

• Catastrophic external event risk has

remainedthe same during the year and is

considered a high impact risk with a medium

to high probability.

• The aftereffects of a global pandemic caused

unprecedented economic and operational

disruption and the continuing global

developments create uncertainty. We however

were able to mitigate the impact through our

portfolio positioning focusing on essential goods

and services, our cash position and liquidity and

our active approach to asset management.

• The relaxing of restrictions was positive but the

cost-of-living crisis has impacted UK households.

Our operational performance has however

demonstrated the resilience of our portfolio.

• The National Terrorism Threat Level is

substantial and the full long-term impact from

the war in Ukraine is unclear.

Responsibility:

Board & ExCo

Link to strategy:

Impact:

Probability:

Movement:

4a. Climate change strategy

A failure to implement appropriate climate risk

management measures, comply with evolving

regulations or meet our ESG targets could

impact the operation and value of our assets,

leading to a risk of asset obsolescence,

reputational damage and erosion of

investorvalue.

• We have a comprehensive ESG programme

which is regularly reviewed by the Board and

Executive Committee. A detailed overview of

the programme can be found in the ESG

section of this report.

• One of the key objectives of the programme is

to minimise our impact on the environment

through reducing energy consumption,

sourcing from renewable sources and

increased recycling.

• We have developed our Pathway to Net Zero

and set new medium and long-term targets in

line with the latest science-based targets.

• ESG performance is independently reviewed

by our external environmental consultants

andis measured against applicable targets

and benchmarks.

• We continue to report in line with

TCFDrequirements.

• The climate change risk was separated last

year into two risks to focus on its constituent

parts (Climate change strategy and Climate

change impacts on our assets).

• Climate change strategy risk remained the

same during the period and is considered a

medium to high impact risk with a medium to

high probability.

• ESG has risen up the agenda of many

stakeholders and expectations of compliance

with best practice have increased.

• Regulatory requirements have also increased

during the period, in addition to the scoring

criteria for certain ESG benchmarks such

asGRESB.

• Our ESG Committee pre-empted these

changes and our initiatives and disclosure

continue to evolve in-line with best practice.

• ESG is embedded into capital allocations and

is considered for all future acquisitions.

Responsibility:

Board & ExCo, CEO and ESG Committee,

Head of ESG

Link to strategy:

Impact:

Probability:

Movement:

4b. Climate change

impacts on ourassets

Adverse impacts from environmental incidents

such as extreme weather or flooding could

impact the operation of our assets. A failure

toimplement appropriate climate risk

management measures at our assets could

lead to erosion of investor value and increases

in insurance premiums.

• We regularly assess assets for environmental

risk and ensure sufficient insurance is in

placeto minimise the impact of

environmentalincidents.

• In conjunction with insurers flood risk

assessments have been carried out at all of

our assets and the risk is considered low.

• The climate change risk was separated into

two risks last year to focus on its constituent

parts (Climate change strategy and Climate

change impacts on our assets).

• Climate change impacts on our assets risk

remained the same during the period and is

considered a medium to high impact risk with

a medium to low probability.

• Although exposure to extreme weather events

is a near-term risk, other climate impacts such

as heat stress and sea level rises are medium

term or long-term time horizons. Whilst their

impact is high, their probability is low in the

short to medium term.

• Climate impacts are embedded into capital

allocation decisions and considered for all

future acquisitions of both equipment installed

at our assets and for the assets themselves.

Responsibility:

Board & ExCo, CEO and ESG Committee,

Head of ESG

Link to strategy:

Impact:

Probability:

Movement:

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

External risks continued

Risk and impact Monitoring and management Change in risk assessment

during the period

5. Changes in technology and

consumer habits and demographics

Changes in the way consumers live, work,

shop and use technology could have an

adverse impact on demand for our assets.

• The Board and Executive Committee regularly

assess our overall corporate strategy and

acquisition, asset management and disposal

decisions in the context of current and future

consumer demand. Our strategy is designed

to focus on resilient assets that take into

account these future changes.

• We closely assess the latest trends reported

by CACI, our research provider, to ensure we

are aligned with evolving consumer trends.

• Our retail portfolio is focused on essential

spending on goods and services which are

resilient to the growth of online retail.

• Our retail parks are ideally positioned to help

retailers with their multi-channel retail strategies.

• Changes in technology and consumer habits

risk has remained the same during the year

and is considered a low-medium impact risk

with a high probability.

• Although the global pandemic lockdown

restrictions significantly increased home working

and online shopping in recent years, we have

seen evidence that this is unwinding. Our

portfolio is focused on providing essential retail

to local communities, which continues to mitigate

the impact of online retail on our portfolio.

• While the global pandemic may have

accelerated the trend to online shopping,

thisprovides opportunities for our portfolio,

particularly retail parks and local community

shopping centres.

• Our strategy is to reshape our portfolio to

ensure over the longer term we have the most

resilient retail portfolio in the UK.

Responsibility:

Board & ExCo

Link to strategy:

Impact:

Probability:

Movement:

6. Cyber security

A cyber attack could result in the Group being

unable to use its IT systems and/or losing data.

This could delay reporting and divert

management time. This risk could be

increased due to many employees working

from home during the pandemic.

• There are limited IT servers on sites. Multiple

third-party supplier programmes are used

which have their own security systems and are

independently audited by Deloitte and

ISO2000 accredited.

• ExCo receives quarterly reporting on IT matters.

• Security protocols are in place to ensure swift

changes to data access following staff

changes and to limit authority and access.

• We have reviewed our IT systems and have

enhanced a number of areas during the year.

• Cyber insurance cover is in place.

• We have recently carried out an external

review of the Group’s IT security and systems

as part of our internal audit process.

• Cyber security risk has remained unchanged

during the year and is considered a medium to

high impact risk with a medium to high

probability. Whilst global developments have

increased cyber security risks we have carried

out further enhancements and audits to our IT

systems and procedures during the year.

• This risk was considered to be increased due

to employees working from home during the

pandemic. Staff may now continue to work

from home on a flexible basis.

Responsibility:

Board & ExCo,and Head of IT

Link to strategy:

Impact:

Probability:

Movement:

Key

Risk change during FY23

Risk has increased Risk has decreased Risk has not changed

Impact and probability

Low Medium High

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Principal risks and uncertainties continued

Operational risks

Risk and impact Monitoring and management Change in risk assessment

duringtheperiod

7. People

The inability to attract, retain and develop

ourpeople and ensure we have the right skills

in place could prevent us from implementing

our strategy.

• Attracting, retaining and developing talent is

core to our HR strategy, which is regularly

reviewed by the Board and Executive

Committee.

• We undertake an employee survey once a

year to gauge employee views on leadership,

company culture, health and wellbeing,

personal growth and benefits and recognition.

This informs any changes to HR policy.

• We regularly benchmark our pay and benefits

against those of peers and the wider market.

• Succession planning is in place for all key

positions and is reviewed regularly by the

Nomination Committee.

• Longer notice periods are in place for key

employees.

• Our recruitment policies consider the needs of

the business today and our aspirations for the

future, whilst ensuring our unique corporate

culture is maintained.

• The probability of the People risk has reduced

during the year and is considered a medium

impact risk with a medium probability.

• Inflation has put pressure on salary costs and

demands. This impact is mitigated by an active

employee engagement programme and the

alignment of reward with both individual and

Company-level performance.

• We continue to focus on staff wellbeing and

actively seek regular feedback from staff. The

recent Sunday Times Best Places to Work

2023 survey was strongly positive and

showed a low staff flight risk.

• We also offer many forms of flexible working

including job share, annualised hours, variation

of hours and working from home. Since the

pandemic we have implemented a policy of

flexible working enabling staff to work from

home a number of days a week should they

choose to do so.

Responsibility:

Remco, ExCo, SID(asemployee

engagement director), Head of HR

Link to strategy:

Impact:

Probability:

Movement:

8. Financing

If gearing levels become higher than our risk

appetite or lead to breaches in bank

covenants this would impact our ability to

implement our strategy. The business could

also struggle to obtain funding or face

increased interest rates as a result of

macroeconomic factors.

• The Board regularly assesses Company

financial performance and scenario testing,

covering levels of gearing and headroom to

financial covenants and assessments by

external rating agencies.

• The Company has a programme of active

engagement with key lenders and

shareholders.

• The Company has a wholly unsecured balance

sheet, which mitigates the risk of a covenant

breach caused by fluctuations in individual

property valuations.

• The Company has long-dated maturity

onitsdebt, providing sufficient flexibility

forrefinancing.

• Working capital and cashflow analysis and

detailed forward assessments of cashflows

areregularly reviewed by the

ExecutiveCommittee.

• Our credit rating is independently assessed

byFitch Ratings at least annually.

• Financing risk has increased during the year

and is considered a medium impact risk with a

medium probability.

• Macroeconomic developments, particularly the

increase in inflation, have impacted financial

markets. The strength of the Company’s

unsecured balance sheet means we have

significantly mitigated the risk of not being

able to secure sufficient financing. Increased

cash levels also mitigated these risks and

provide deposit opportunities.

• The Company extended the maturity on its

undrawn Revolving Credit Facility to August

2024 in the prior year.

• There is no exposure to interest rate rises on

drawn debt.

Responsibility:

ExCo & CFO

Link to strategy:

Impact:

Probability:

Movement:

9. Asset management

The performance of our assets may not meet

with the expectations outlined in their business

plans, impacting financial performance and the

ability to implement our strategies.

• Asset-level business plans are regularly

reviewed by the asset management team and

the Executive Committee and detailed

forecasts are updated frequently.

• The Executive Committee reviews whole

portfolio performance on a quarterly basis to

identify any trends that require action.

• Our asset managers are in contact with centre

managers and occupiers on a daily basis to

identify potential risks and improvement areas.

• Revenue collection is reviewed regularly by

the Executive Committee.

• Retailer concentration risk is monitored, with

aguideline that no retailer will account for

more than 5% of gross income (currently our

largest retailer is Poundland accounting for

3.4% ofgross income).

• Asset management risk has remained

thesame during the year and is considered

amedium to high impact risk with a

mediumprobability.

• The global pandemic placed restrictions on

the operations of our occupiers and impacted

performance and rent collection at our assets.

These have improved greatly and are now

close to pre-pandemic levels.

• Our diverse tenant portfolio focuses on

essential retail which reduces the impact of

individual defaults on income.

• Although we have a low probability of default,

the continued cost of living crisis may impact

the financial health of our occupiers.

• Our operational performance continues to

prove the resilience of our assets.

Responsibility:

ExCo, EmmaMackenzie, Head of Asset

Management and theAsset Managers

Link to strategy:

Impact:

Probability:

Movement:

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Risk and impact Monitoring and management Change in risk assessment

during the period

10. Development

Delays, increased costs and other challenges

could impact our ability to pursue our

development pipeline and therefore our ability

to profitably recycle development sites and

achieve returns on development.

• We apply a risk-controlled development

strategy through negotiating long-dated

pre-lets for the majority of assets.

• All development is risk-controlled and forms

only 3% of the portfolio by value.

• Capital deployed is actively monitored by the

Executive Committee, following detailed due

diligence modelling and research.

• An experienced development team monitors

on-site development and cost controls.

• On large scale developments where

construction is more than 12 months we look

to carry out the project in partnership and/or

forward sell.

• Development risk probability has increased

through the period and is considered a medium

impact risk with a medium to high probability.

• Supply issues and increases in the cost of

building supplies will impact our

developments. As they remain a small part of

portfolio the overall impact is low.

• A number of our regeneration assets were sold

during in the prior year which decreased the

proportion of assets focused on development

which inherently reduces risk exposure.

Responsibility:

Board & ExCo,

Development team leaders

Link to strategy:

Impact:

Probability:

Movement:

11. Acquisition

The performance of asset and corporate

acquisitions might not meet with our

expectations and assumptions, impacting our

revenue and profitability.

• We carry out thorough due diligence on all

new acquisitions, using data from external

advisers and our own rigorous in-house

modelling before committing to any

transaction. Probability-weighted analysis

takes account of these risks.

• Acquisitions are subject to approval by the

Board and Executive Committee, who are

highly experienced in the retail sector.

• We have the ability to acquire via joint

ventures, thereby sharing risk.

• Acquisition risk has remained the same

through the year and is considered a medium

impact risk with a medium probability.

• The lack of supply and relative price of some

assets may reduce opportunities for acquisition.

• Having sold the Hawthorn pub business and

completed planned retails disposals, we are

now in a position to deploy capital in line with

our returns-focused approach to capital

allocation and subject to our LTV guidance.

Responsibility:

Board & ExCo,

Charles Spooner, Head of Capital Markets

Link to strategy:

Impact:

Probability:

Movement:

12. Disposal

We may face difficulty in disposing of assets or

realising their fair value, thereby impacting

profitability and our ability to reduce debt

levels or make further acquisitions.

• Our portfolio is focused on high-quality assets

with low lot sizes, making them attractive to a

wide pool of buyers.

• Assets are valued every six months by

external valuers, enabling informed disposal

pricing decisions.

• Disposals are subject to approval by the Board

and Executive Committee, who are highly

experienced in the retail sector.

• Our portfolio is large and our average asset lot

size is small, meaning that each asset

represents only a small proportion of revenues

and profits, thereby mitigating the impact of a

sale not proceeding.

• Disposal risk has increased during the year

and is considered a medium impact risk with

amedium to high probability.

• National and geopolitical uncertainty, interest

rate rises, inflation and the cost-of-living crisis

have increased market uncertainty and are

causing some purchasers to reconsider or

delay acquisition decisions.

• We have an active and successful disposal

programme where we have executed

disposals in the year, with the volume of

transactions being completed increasing

disposal risk. The average lot size however is

lower than most in the market so our assets

tend to be more liquid.

Responsibility:

Board & ExCo,

Charles Spooner, Head of Capital Markets

Link to strategy:

Impact:

Probability:

Movement:

Operational Risks continued

Key

Risk change during FY23

Risk has increased Risk has decreased Risk has not changed

Impact and probability

Low Medium High

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Strategic Report

Principal risks and uncertainties continued

Viability statement

Period of assessment

The UK Corporate Governance Code requires the Directors to

appraise the viability of the Group over what they consider to be an

appropriate period of assessment taking into account the Group’s

current position, its business model (pages 11 and 18), strategy(pages 4

and 11) and principal risks and uncertainties(pages 88 to 94).

In making this assessment, the Directors view the Group’s focus on

its resilient sub-sector of convenience retail, expertise in asset

management and risk-controlled development, disposal track record

and unencumbered balance sheet as the key aspects supporting the

long-term sustainability of the business.

The Directors consider the appropriate period of assessment to be

three years from the current financial year end, to 31 March 2026.

This period of assessment is aligned to performance measurement

and management remuneration, and in the opinion of the Directors,

this period of assessment strikes the optimal balance of allowing the

impact of strategic decisions to be modelled while maintaining the

accuracy of underlying forecast inputs.

Principal risks

In making their viability assessment, the Directors assessed the

potential impacts, in severe but plausible scenarios, of the principal

risks as set out on pages 89 to 94, together with the likely degree of

effectiveness of mitigating actions reasonably expected to be

available to the Group. The most relevant of these risks to viability,

with the highest potential impact, were considered to be:

• Macroeconomic – Economic conditions in the UK and changes to

fiscal and monetary policy may impact market activity, demand for

investment assets, the operations of our occupiers or the spending

habits of the UK population.

• Political and regulatory – Changes in UK Government policy,

remaining uncertainty around the impact of Brexit on our tenants,

the conflict in Ukraine and its impact on the UK or the impact of

political uncertainty on the consumers’ retail and leisure spend.

• Catastrophic external event – An external event such as civil

unrest, a civil emergency including a large-scale terrorist attack or

pandemic, could severely disrupt global markets and cause

damage and disruption to our assets.

The Board is encouraged with the return to normalised trading

conditions in the UK post the Covid pandemic, as illustrated by the

stabilisation of the Group’s rental collection rates at pre pandemic

levels (98%). However, there remains significant uncertainty around

the prospects for the UK economy due to the mix of high inflation,

low expected growth, the associated cost of living crisis and the

continuing rise in interest rates; notwithstanding the Group’s own

position of strength in navigating these uncertain times through its

superior yields, unencumbered balance sheet, low and fixed cost of

debt and no maturity on drawn debt until 2028.

Process

The Group’s annual budget, forecast and business planning process

takes place in the final quarter of the financial year, with final budget

signed off by the Board early in the new financial year.

The exercise is completed at a granular level, on a lease-by-lease

basis and considers the Group’s profitability, capital values, loan to

value, cash flows and other key financial metrics over the forecast

period. The Group benefits from a wholly unsecured balance sheet

and the only drawn debt currently in the Group is the £300million

bond, which is not due for repayment until the end of FY28.

Following the Group divesting itself of its community pub business in

FY22, which reset its LTV and provided the firepower to reshape its

portfolio, the Group’s clear strategic aim has been that by 2025 the

assets in its portfolio will display only the characteristics of resilient

retail. It is considered that resilient retail assets in the future will be

those located in catchments with long-term growth potential and

the right balance between the supply of physical retail space and

demand for that space; they will have an offering that meets the

everyday needs of customers while playing a distinct role within

their communities.

The Directors believe that the Group will deliver this through

remaining committed to the following strategic priorities:

• Selling its non-core retail assets and recycling the resultant capital

into resilient retail. The Group has begun reshaping its portfolio to

ensure that over the longer term it only owns retail assets that

display these key characteristics. To this end the Group completed

£77m of retail disposals in FY22, completed £23m in FY23 and

expects further sales in FY24 in line with the strategy.

• Transforming its regeneration assets to create long-term

value by jointly working with sector specialists and appropriate

capital partners.

The Directors believe that the collective measures outlined above

will transform the Group into a more agile business committed to

delivering attractive returns to shareholders.

The forecast scenario selected by the Directors to assess the Group’s

viability is based on this strategic approach. This assumes exiting the

workout portfolio by the end of FY24 along with other retail strategic

acquisitions and disposals. Under this scenario, the Group is forecast

to maintain sufficient cash and liquidity resources and remain

compliant with its financial covenants with significant headroom.

Further sensitivity analysis was performed on this scenario to align it

with the assumptions used in the reasonable worst case scenario for

the going concern review (see the Going Concern section of note 1 of

the financial statements). This includes removing all uncommitted

acquisitions and disposals, assuming further valuation decline and a

lower income collection rate. Even applying this sensitivity analysis,

the Group maintains sufficient cash and liquidity reserves to continue

in operation throughout the assessment period and comfortably meet

its covenants.

Viability statement

On the basis of this and other matters considered by the Board

during the year, the Board has a reasonable expectation that the

Group will be able to continue in operation and meet its liabilities as

they fall due over the three year period of their detailed assessment.

Going concern

The Directors of NewRiver REIT plc have reviewed the current and

projected financial position of the Group making reasonable

assumptions about future trading and performance. Severe but

plausible downside scenarios were applied to the assumptions and

the Directors are satisfied that the going concern basis of

presentation of the financial statements is appropriate.

The Strategic Report was approved by the Board on 14 June 2023

By order of the Board

Allan Lockhart

Chief Executive Officer

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Structure of the

Governance Section

The Governance section provides details of the Board’s corporate

governance structures and work for the financial year to 31 March 2023.

Together with the Directors’ Remuneration Report on pages 128 to 136,

itincludes information about how the Company has applied the principles

and complied with the provisions of the 2018 UK Corporate Governance

Code. The Governance section has been organised to follow the structure

and principles (A to R) of the 2018 Code.

Compliance with the 2018 UK

Corporate Governance Code

As a Company with a premium listing on the

London Stock Exchange, NewRiver is

required under the Financial Reporting

Council (FRC) Listing Rules to comply with

the Code Provisions of the 2018 UK

Corporate Governance Code issued in July

2018 (the ‘2018 Code’) which is available on

the FRC website (www.frc.org.uk). The

principles and provisions of the 2018 Code

have applied throughout the year to

31 March 2023 and the Company has fully

complied with all the provisions of the Code,

except Provisions 10 and 38 as explained

more fully on this page.

Code Provision 10

Requires the Board to identify in its Annual

Report each Non-Executive Director that it

considers to be independent. The Board

considers all its Non-Executive Directors to

be independent, however Provision 10 notes

that circumstances that are likely to impair,

or could appear to impair, a Director’s

independence includes if a Director has

served on the Board for more than nine

years. Kay Chaldecott was appointed in

2012 and did not retire until the 2022 AGM.

Against a backdrop of COVID-19 the Board

requested that Kay extend her tenure by

one year in 2021 so Kay’s tenure went

beyond her ninth year. The extension

allowed the Board to continue to benefit

from her significant knowledge and

expertise of the real estate sector as the

Company navigated the effects of the

COVID-19 pandemic. This non-compliance

applied topart of FY23 and has now been

corrected with Kay’s retirement.

Code Provision 38

Requires, among other things, that the

pension contribution rates for executive

directors should be aligned with those

available to the workforce. Since the

adoption of the Remuneration policy at the

AGM in 2020, any new Executive Directors

receive Company contributions in line with

the UK workforce which is currently 4%. Will

Hobman, appointed in August 2021 receives

Company contributions of 4% in line with the

UK workforce. The Company is currently

contributing 15% of base salary for the CEO.

As outlined in the Remuneration Policy this

contribution rate will be reduced for this

incumbent Director to the rate applicable to

the majority of the workforce at the

2023AGM.

Board leadership and Company purpose

A. An effective Board 98

B. Purpose, values and culture 101

C. Governance framework and Board resources 105

D. Stakeholder engagement 20-27, 102

E. Workforce policies and practices 22-24, 102

Division of responsibilities

F. Board roles 104

G. Independence 104, 110

H. External appointments and conflicts of interest 98-99, 103

I. Key activities of the Board in FY23 103

J. Appointments to the Board 107, 110

K. Board skills, experience and knowledge 111

L. Annual Board and Committee evaluation 108

Audit, risk and internal control

M. Financial reporting, external auditor and internal

audit

114-115

N. Review of the 2023 Report and Accounts 118

O. Internal financial controls and risk management 116-117

Remuneration

P. Linking remuneration with purpose and strategy 119-126, 130

Q. Remuneration Policy review 119-127

R. Performance outcomes in FY23 and strategic targets 130

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Corporate Governance

Dear Shareholders

I have pleasure in introducing

NewRiver’s Corporate Governance

report for the year ended 31 March

2023. I believe that the Board’s

continued commitment to strong

governance and stakeholder

engagement underpins our

purpose, values and strategy.

This report outlines our

governance structure and

processes and the work of the

Board and its committees.

The Chair’s Letter

onGovernance

The Chair’s Letter on Governance

Board appointment and induction

Kay Chaldecott stepped down from the Board at the 2022 AGM so much of the Nomination

Committee’s activity in FY22 and FY23 was to scope and recruit her replacement. Following

the recruitment process in May 2022 we were delighted to welcome Dr Karen Miller to

the Board as a Non-Executive Director. Karen is a commercial sustainability expert with a

proven track record of leading transformation in the built environment which will support

the ambitions of our environmental sustainability strategy. The process for appointing Karen

and her induction is more fully detailed in the Nomination Committee Report.

Stakeholder engagement

Asset visits

In a post pandemic world we have taken the opportunity to re-engage with our stakeholders

face to face. The virtual engagement worked well but it has been lovely to physically meet

with people again and get around to visit the assets. Myself and the rest of the Non-Executive

Directors have toured the UK this year visiting the assets. Whilst we have been kept updated

on all our assets during the restrictions of the pandemic, being able to physically visit the

assets again brings the regular Board reporting alive and allows us to build better

relationships with the stakeholders at the assets.

Staff engagement

Engagement with our staff has also benefited from the return to physical visits and meetings.

We have a small workforce with only around 50 employees. This made it easier to engage

virtually in team settings, but the return to face to face engagement has allowed us to meet

in more social settings. We have therefore re-commenced some of our social staff gatherings

that the Board attend, enabling us to receive feedback from staff in a less formal setting.

Shareholder engagement

The 2022 AGM was, for the first time in a couple of years, a fully physical meeting. It was

wonderful to see so many shareholders at the AGM and to be able to engage in lively

discussions with those present, which is often missing in a virtual setting. We look forward

to another fully physical AGM again in 2023 and to welcoming and engaging with

shareholders at this meeting. We have, during the year, as part of the Remuneration Policy

review, engaged with our largest shareholders on the Remuneration Policy. We received

overwhelming support on our updates to the policy from those who responded. The updated

Remuneration Policy will be put to the vote at the forthcoming AGM.

Yours sincerely

Baroness Ford OBE

Chair

14 June 2023

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Colin Rutherford

Independent Non-Executive Director,

Appointed February 2019

Key Skills and Experience

Colin is an experienced public and private

company chairman and independent director,

with relevant sector experience including asset

management, bioscience, leisure and real estate.

Colin graduated in accountancy and finance and

qualified with Touche Ross (now Deloitte) in 1984

and is a member of the Institute of Chartered

Accountants of Scotland.

External Appointments

Listed Companies

Evofem Biosciences Inc (Independent Director

and Audit Committee Chairman)

Other

Allstone Sand Gravels & Aggregates Limited

(Chairman); Brookgate Limited (Chairman);

Donaldson Group Limited (Independent Director

and Audit Committee Chairman); Rothley Group

Limited (Chairman)

Allan Lockhart

Chief Executive Officer

Key Skills and Experience

Allan has over 30 years’ experience in the UK

retail real estate market. He started his career

with Strutt & Parker in 1988 advising major

property companies and institutions on retail

leasing, investment and development.

In 2002, Allan was appointed as Retail Director to

Halladale Plc with a remit to acquire value add

opportunities In the UK retail real estate market

and ensure the successful implementation of

asset management strategies. Following the

successful sale of Halladale Plc In early 2007,

Allan co-founded NewRiver and served as

Property Director since its IPO until being

appointed Chief Executive Officer in May 2018.

External Appointments

Chair of the British Property Federation (BPF)

Retail Board

Will Hobman

Chief Financial Officer

Appointed August 2021

Key Skills and Experience

Will is a Chartered Accountant with over 12

years of real estate experience, having qualified

at BDO LLP working in its Audit and Corporate

Finance departments. Before joining NewRiver

in June 2016, Will worked at British Land for five

years in a variety of finance roles, latterly in

Investor Relations, and formerly within the

Financial Reporting and Financial Planning &

Analysis teams. Will obtained a BArch (Hons) in

Architecture from Nottingham University before

obtaining his ACA qualification, becoming an

FCA in March 2020.

External Appointments

British Property Federation Finance

CommitteeMember

Kerin Williams

Company Secretary,

Appointed October 2020

Key Skills and Experience

Kerin is a Chartered Secretary with over 30

years experience. Kerin has worked in-house in

senior positions within company secretarial

departments for a number of FTSE100 and FTSE

250 companies in real estate, chemicals,

banking and printing. Kerin has also worked in

professional services as a company secretarial

consultant; her most recent role was as

Managing Director of Prism Cosec. Kerin

graduated in Law, qualified as a Chartered

Secretary in 1997 and is a Fellow of the

Chartered Governance Institute.

Alastair Miller

Senior Independent Director,

Appointed January 2016

Key Skills and Experience

Alastair is a Chartered Accountant and has

significant, recent and relevant financial

experience. Throughout his career Alastair has

developed skills in risk management, property,

systems, company secretariat and investor

relations. Having worked for New Look

Groupfor14 years, Alastair has an in-depth

understanding of retailers and the factors that

impact their trading and profitability. Alastair

wasformerly Chief Financial Officer of New Look

Group, Group Finance Director of the RAC and

Board of Directors

Our leadership team

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Finance Director of a company within the

BTRGroup. In addition to being the Senior

Independent Director, Alastair has responsibility

for ensuring that the Board successfully engages

with our workforce.

External Appointments

Listed Companies

Superdry Plc (Director and Auditco Chair);

Unbound Group plc (Director and Auditco Chair)

Other

RNLI (Risk and Audit committee member

&Council Member)

Baroness Ford OBE

Non-Executive Chair,

Appointed September 2017

Key Skills and Experience

Baroness Ford has over 20 years’ experience

as a Non-Executive Director and Chairman of

private and Stock Exchange listed companies

and extensive experience of working with the

Government. Margaret also has extensive

knowledge across the real estate market and is

an Honorary Member of the Royal Institute of

Chartered Surveyors. From 2002 to 2008, she

was Chairman of English Partnerships (now

Homes England) and from 2009 to 2012, she was

a member of the Olympic Board and Chairman of

the Olympic Park Legacy Company. Margaret

was previously a Non-Executive Director of Taylor

Wimpey plc and SEGRO plc and the former

Chairman of STV Group plc, Grainger plc and

May Gurney Integrated Services plc.

External Appointments

Listed Companies

Lendlease Corporation

(Senior Advisor to the Board)

Other

Chairman of Challenge Board; Buckingham

Palace Reservicing Programme; National

President of the British Epilepsy Association;

Trustee, British Olympic Association; Director,

Deloitte UK LLP and Chair of the UK Audit

Governance Board; Director, North/South

Europe Board; Member of the Global Advisory

Board for Deloitte.

Baroness Ford was appointed to the House of

Lords in 2006 and is a Cross bench peer.

Charlie Parker

Independent Non-Executive Director,

Appointed September 2020

Key skills and Experience

Charlie Parker was previously Chief Executive

and Head of the Public Service for the

Government of Jersey from January 2018 until

his retirement in March 2021. Prior to working

in Jersey, Charlie was Chief Executive of

Westminster City Council from December 2013 to

December 2017 and Chief Executive of Oldham

Metropolitan Borough Council from October

2008 to December 2013. During his various roles

as a Chief Executive, Charlie oversaw the

significant transformation and modernisation of a

large number of public services often resulting in

reduced costs and improved performance. He

was also responsible for a range of large-scale

capital infrastructure and regeneration projects in

Jersey, Westminster and Oldham. Prior to 2008

he held a number of investment, development

and regeneration roles across national and local

government bodies for over twenty years.

External Appointments

Buckingham Palace Reservicing Programme

Challenge Board; Griffin Investments Ltd

Dr Karen Miller

Independent Non-Executive Director,

Appointed May 2022

Key Skills and Experience

Dr Karen Miller is affiliated to the Department of

Engineering, Cambridge University and is

Co-Founder of the Cambridge Net Positive Lab.

Karen is a sustainability expert with a proven

track record of leading transformation through a

collaborative applied approach in large national

and international companies. Karen has over 25

years’ experience of growing businesses in the

retail sector through innovation.

External Appointments

Buckingham Palace Reservicing Programme

Challenge Board; Co Founder, Cambridge Net

Positive Lab

Key

Chair of committee Member of Audit Committee Member of Nomination Committee Member of Remuneration Committee

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Corporate Governance

Executive Committee

Allan Lockhart

Chief Executive Officer

See page 98 for key skills and experience.

Emma Mackenzie

Head of Asset Management and ESG

Key Skills and Experience

Emma has overarching responsibility for the

financial and operational performance of the

retail portfolio throughout the UK. Emma’s

responsibilities also include oversight of

NewRiver’s property management, rent

collection and the Company’s Environmental,

Social and Governance programme.

Emma is a qualified chartered surveyor with

over 20 years’ experience in the retail

property market.

Launched in June 2020, Emma is one of nine

Board Members on the Government’s High

Street Task Force, following her role on the

Government’s High Streets Expert Panel and

chaired by Sir John Timpson in 2019. The HSTF

provides access to experts, case studies and

practical solutions to local town leaders and

Government to help support and revitalise UK

high streets and town centres.

Emma also sits on the Commercial Committee

of the British Property Federation.

Charles Spooner

Head of Capital Markets

Key Skills and Experience

Charles is responsible for Capital Markets and

Retail Parks throughout the UK and has over 20

years’ experience in the real estate investment

and asset management sector.

Charles has benefited from the broad

experience as an asset manager at F&C REIT

and RREEF, on an advisory capacity at Cushman

Wakefield and as a retailer advising Specsavers

on their investment agency and development

activity. Charles is responsible for acquisitions,

disposals, development and implementation of

asset management strategies, with particular

focus on the retail warehouse sector.

Will Hobman

Chief Financial Officer

See page 98 for key skills and experience.

Edith Monfries

Chief Operating and People Officer

Key Skills and Experience

Edith is a Chartered Accountant having trained

with Deloitte, Haskins and Sells. She has over

30 years’ experience in the retail and leisure

property sector, combining Finance, Operational

and HR roles, specialising in advising on

strategic and operational matters.

Edith was appointed Head of HR at NewRiver in

October 2018 and now in her role as COO

brings her expertise in talent development

within the sector to the business. She served as

COO of Hawthorn when the pub company was

under NewRiver’s ownership and oversaw the

smooth transition following the sale.

100

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Board leadership

and company purpose

Generation and preservation

of value over the long term

The Board’s role is to lead the Group and ensure

that it delivers sustainable and growing returns

for our shareholders over the longer term.

NewRiver’s business model and strategy is set

out on pages 11 and 18 of the Strategic

Report and describes the basis upon which the

Company generates and preserves value over

the long term.

Purpose, Values and Strategy

Our purpose is to own, manage and develop resilient retail assets across the UK that provide essential goods and

services and support the development of thriving communities. A global pandemic, geopolitical unrest and a cost

of living crisis have proved that this business purpose provides us with a resilient and long-term sustainable

business that will generate value for shareholders and contributes to wider society.

Our Culture

NewRiver’s collaborative and supportive culture underpins this purpose and drives

business practices. With a small workforce of around 50 employees our culture is able

to provide individuals who work for us a sense of purpose and an opportunity to thrive

and develop as individuals. The proximity between Board and employees makes it

easier for the Board to engage with employees and the Directors can monitor the

culture in a way not possible for larger companies. The small size of our team also

allows for flexibility and adaptability so that we can respond to fast changing situations.

Board Leadership

The Board oversees the Group’s active approach to asset management and the

strategy of developing and recycling convenience-led, community-focused retail assets

throughout the UK and this in turn contributes to the community and wider society.

The Board has overall authority for the management and conduct of the Group’s

business, strategy and development and is responsible for ensuring that this aligns

withthe Group’s culture.

The Board, supported by the Company Secretary, ensures the maintenance of a system

of internal controls and risk management (including financial, operational and compliance

controls) and reviews the overall effectiveness of the systems in place. The Board

delegates the day-to-day management of the business to the Executive Committee.

There is a schedule of matters reserved for the Board’s decision which forms part of

adelegated authority framework to ensure that unusual or material transactions are

brought to the Board for approval. This schedule of matters is reviewed regularly to

ensure that it is kept up to date with any regulatory changes and is fit for purpose. The

lastreview was undertaken in February 2023. The Executive Committee also has its own

Terms of Reference that fit within the governance framework and are approved by the

Board. These terms of reference were last reviewed and updated in November 2022.

1. Disciplined

capital allocation

3. Flexible

balance sheet

2. Leveraging

our platform

101

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Workforce engagement mechanism – the role of our designated

Non-Executive Director

Alastair Miller, our Senior Independent Director, has responsibility for ensuring that the Board

successfully engages with our workforce.

As Chair of the Remuneration Committee Alastair has direct engagement with shareholders

on remuneration policy and is therefore best placed to answer questions from the workforce

on Director remuneration and its alignment to group wide remuneration and strategy.

We have a small workforce which allows a natural proximity between the Board and the

workforce making it easy for the Board to engage with staff directly, especially as the

Directors regularly visit the London office and also other sites. Staff are invited on a regular

basis to attend a group meeting with Alastair in the London office, or online if preferred. The

most recent meeting was held in April 2023. Questions are invited ahead of the session as

well as taken live on the day. Over 60% of staff attended the meeting with the majority of

these in person. Alastair took the opportunity to explain and discuss the new proposed

Directors’ Remuneration Policy to the staff and to invite questions. These discussions

naturally led to staff salary reviews and the guidance from the Remuneration Committee on

all reviews in the context of the wider market and the challenges of our inflationary economy.

The performance of the LTIP (a share scheme that all staff participate in) was discussed.

Alastair also asked for views on staff morale, the recent office move and the continued

access to flexible working, all of which were positive. The session also discussed the results

of The Sunday Times Best Places to Work 2023 survey which had been undertaken and the

results from this survey which are strongly positive with a very high confident score in

management and an indicated very low risk of flight.

Board

(Led by Alastair Miller, our Non-Executive Director,

responsible for workforce engagement)

• NED/Staff engagement sessions

• Staff survey results

• NED visits to assets and London office

• Social Events with staff

Executive Committee (“ExCo”)

• Direct report engagement and staff appraisals and feedback

• Monthly All Staff sessions

• Staff survey results

• Social events with staff

• Fund raising events with staff

Our Staff

• Monthly All Staff Sessions

• Staff survey results

Staff engagement

Corporate Governance continued

Board activities

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Discussion Link to strategy

Strategy

• The Board discussed progress against strategy at most meetings and receives

updates on strategy in the CEO’s report

• During the year an entire Board meeting was devoted to strategy to ensure time could

be dedicated to a deep dive into strategic progress and direction

ESG

Finance and

Financing

• The Chief Financial Officer has presented a financial report at each Board meeting

• Approval of the Annual Report and interim report and associated financial statements

• Presentation and discussion on the draft budget and business plan

• Approval of the annual budget

• The CFO provides quarterly reporting against the Treasury policy and the Board

considered updates to the Treasury policy to take advantage of better returns on

excess cash

ESG

Audit and Risk

• The Chair of the Audit Committee reported to the Board on the proceedings of each

Audit Committee meeting and meetings with valuers

• The Board considers the risk register and internal controls at least twice a year

• Update to the Board on the whistleblowing procedures

ESG

Operational and

Investor Relations

• The CEO presented a report at each Board meeting which also included updates on

investor relations

• Members of the ExCo are regularly invited to attend the Board meetings to present on

various projects

• In September 2022 the Group held a capital markets day

ESG

Stakeholders

• Stakeholders including employees, occupiers, councils and communities, lenders and

shareholders are regularly considered as part of the CEO report to the Board

• The Non-Executive Directors visited a number of the Group’s assets during the year

and were provided with guided tours from the asset management teams responsible

for the assets

• HR reports are either tabled separately or included the CEO’s report

• The Board received updates from Alastair Miller’s attendance at staff sessions

ESG

Environmental

• The Board receives regular updates on ESG progress in the CEO’s report

• The Audit Committee reviewed progress against ESG targets and reported to the Board

ESG

Governance

• The Committee Chairs reported on key matters discussed at the Board Committees

• The Company Secretary reported on key governance developments and on work

carried out to update the Group’s governance policies and procedures

• The Board reviewed the Group governance framework, updated the Board’s schedule

of matters and reviewed and updated the terms of reference of the Board committees,

including ExCo

ESG

Conflicts of interest

The Company Secretary keeps a register of all Directors’ interests.

The register sets out details of situations where each Director’s

interest may conflict with those of the Company (situational conflicts).

The register is considered and reviewed at each Board meeting so

that the Board may consider and authorise any new situational

conflicts identified. At the beginning of each Board meeting, the

Chairreminds the Directors of their duties under sections 175,

177 and 182 of the Companies Act 2006 which relate to the

disclosure of any conflicts of interest prior to any matter that may be

discussed by the Board. During the year the Board also approved a

staff conflicts of interest policy so that a conflicts of interest register

was also maintained below Board and ExCo level.

Director concerns

Directors have the right to raise concerns at Board meetings and

can ask for those concerns to be recorded in the Board minutes.

The Group has also established a procedure which enables Directors,

in relevant circumstances, to obtain independent professional advice

at the Company’s expense.

Board time commitments

All Directors pre-clear any proposed appointments to listed

company boards with the Board prior to committing to them.

The Non-Executive Directors are required, by their letters of

appointment, to devote as much of their time, attention, ability and

skills as are reasonably required for the performance of their duties.

This is anticipated as a minimum of one day a month. The Nomination

Committee annually reviews the time commitments to ensure that all

Board members continue to be able to devote sufficient time and

attention to the Company’s business. Whilst a number of the Board

have other Non-Executive directorships and commitments the

Nomination Committee remains satisfied that all of the Directors

spend considerably more than this amount of time on Board and

Committee activity.

The other listed company directorships of the NewRiver REIT plc

Directors is set out on pages 98 to 99. The Board and committee

attendance record of each of the Directors during FY23 is set out on

page 106 of this report.

Key

Link to business model and strategic objectives

Disciplined capital allocation

Leveraging our platform

Flexible Balance Sheet

ESG

Environmental, Social and Governance

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

There is a clear division of responsibilities between the Chair, CEO and other members of the Board, as follows:

Role Responsibilities

Chair

Margaret Ford

Margaret’s role is to lead the Board and ensure that it operates effectively.

Her responsibilities include:

• setting the agenda, style and tone of Board meetings to ensure that all matters are given due consideration;

• maintaining a culture of openness, debate and constructive challenge in the Board room;

• ensuring the Board’s effectiveness and ensuring it receives timely information;

• ensuring each new Director receives a full, formal and tailored induction on joining the Board; and

• reviewing and agreeing training and development for the Board.

Chief Executive

Officer

Allan Lockhart

Allan’s responsibilities include:

• managing the business of the Group;

• recommending the Group’s strategy to the Board;

• ESG strategy;

• implementing the strategy agreed by the Board; and

• management of the Group’s property portfolio, including developments.

Chief Financial

Officer

Will Hobman

Will’s responsibilities include:

• implementing the Group’s financial strategy, including balance sheet capitalisation;

• overseeing financial reporting and internal controls; and

• supporting the CEO in the delivery of the Group’s strategy and financial performance.

Senior Independent

Non-Executive

Director

Alastair Miller

Alastair’s responsibilities include:

• acting as a sounding board for the Chairman;

• evaluating the Chairman’s performance as part of the Board’s evaluation process;

• serving as an intermediary for the other Directors when necessary;

• being available to shareholders should an occasion occur when there was a need to convey concern to the Board

other than through the Chairman or the Chief Executive; and

• ensuring that the Board successfully engages with our workforce.

Independent

Non-Executive

Directors

Non-Executive Directors Alastair Miller, Charlie Parker, Colin Rutherford and Karen Miller bring independent

judgement, knowledge and varied commercial experience to the meetings and in their oversight of the Group’s

strategy. Alastair and Colin chair the Remuneration and Audit Committees respectively.

Balance between Independent Non-Executive and

ExecutiveDirectors

The Board comprises four independent Non-Executive Directors

(excluding the Chair) and two Executive Directors. The Nomination

Committee is of the opinion that the Non-Executive Directors remain

independent, in line with the definition set out in the Code and are

free from any relationship or circumstances that could affect, or

appear to affect, their independent judgement. The Chair was

independent on appointment and the Board still considers her to be

independent. All Directors are subject to re-election at the AGM

each year.

Company Secretary

All Directors have access to the advice and services of the Company

Secretary. The appointment of the Company Secretary is a matter for

the Board.

Executive Committee (ExCo)

The purpose of ExCo is to assist the CEO in the performance of his

duties within the bands of the Committee’s authority, including:

• the development and implementation of strategy, operational

plans, policies, procedures and budgets;

• the monitoring of operating and financial performance;

• the assessment and control of risk;

• development and implementation of the ESG strategy;

• the prioritisation and allocation of resources; and

• monitoring competitive forces in each area of competition.

Division of responsibilities

Corporate Governance continued

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Remuneration Committee

Implements the Remuneration

Policy of the Group which is to

ensure that Directors and senior

management are rewarded in a

way that attracts, retains and

motivates them and aligns the

interests of both shareholders

and management.

Audit Committee

Reviews and monitors the Group’s

risk management processes.

Monitors the integrity of the

half-year and annual financial

statements before submission

to the Board.

Monitors the effectiveness of the

audit process.

Nomination Committee

Reviews the succession planning

requirements of the Group and

operates a formal, rigorous and

transparent procedure for the

appointment of new Directors to

the Board.

Board

Responsible for leading the Group, establishing the Company purpose and values and setting the strategy

and monitoring its progress. It sets policies and monitors performance.

Executive Committee (“ExCo”)

Assist the Chief Executive with the development and implementation of the Group strategy, the management

of the business and the discharge of its responsibilities delegated by the Board.

Senior Leadership

Team (SLT)

Senior members of the business

below ExCo level tasked with

assisting ExCo with the progress of

the Group strategy.

ESG

Committee

Led by Emma Mackenzie, Head of

Asset Management and ESG, the

ESG Committee ensures the

appropriate resources are

mobilised so the key ESG

programme milestones are

achieved.

Well-Being

Committee

Originally set up during lockdown

restrictions to focus on staff

wellbeing the committee has

evolved its brief to provide a

collective employee voice and to

focus on diversity and inclusion.

Supporting Committees

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Attendance

Each of the Directors has committed to attend all scheduled Board and relevant committee meetings and has also committed to make every

effort to attend ad hoc meetings, either in person or by telephone/video call. Board papers are circulated to Directors in advance of the

meetings via an electronic board portal. This allows for an efficient and secure circulation of Board papers and if a Director cannot attend a

meeting, he or she is able to consider the papers in advance of the meeting as usual and will have the opportunity to discuss them with the

Chair or Chief Executive and to provide comments. The Non-Executive Directors meet without the Executive Directors and the Chair present

atleast once a year.

Attendance at regular scheduled Board meetings and the Board Committees is shown below:

Board Members

Board

Attendance

Audit Committee

Attendance

Remuneration Committee

Attendance

Nomination Committee

Attendance

Margaret Ford

: Chair 7/8 – 2/4 3/3

Executive Directors

Allan Lockhart 8/8 – – –

Will Hobman

7/8 – – –

Non-Executive Directors

Kay Chaldecott

2/2 2/2 1/1 1/1

Alastair Miller 8/8 5/5 4/4 3/3

Charlie Parker 8/8 5/5 4/4 3/3

Colin Rutherford 8/8 5/5 4/4 3/3

Dr Karen Miller

8/8 3/3 3/3 2/2

1. Margaret Ford was unable to attend one Board meeting and one Remuneration Committee due to a family matter and one remuneration committee due to a

prior meeting.

2. Will Hobman missed a Board meeting due to the birth of his daughter

3. Kay Chaldecott stepped down on 26 July 2022

4. Dr Karen Miller was appointed to the Board and its Committees on 30 May 2022

Corporate Governance continued

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Composition, succession

andevaluation

Induction of new Directors

The Chairman, Company Secretary and Chief Operating and People

Officer manage an induction process to ensure that new Directors

are fully briefed about the Company and its operations. This process

usually includes asset visits and meetings with members of the

senior management team as well as specific briefings with regard to their

legal and regulatory obligations as a Director. New Directors are also

given the opportunity to visit the assets and meet members of the team.

Annual General Meeting (“AGM”)

The AGM is the annual opportunity for all shareholders to meet with

the Directors and to discuss with them the Company’s business and

strategy. Shareholders are therefore welcome to attend in person at

the 2023 AGM, and recognising that some shareholders may still not

feel comfortable attending in person, we have provided a facility for

shareholders to submit questions ahead of the AGM via email. The

AGM is planned to be held on 26 July 2023.

The notice of AGM is posted to all shareholders at least 20 working

days before the meeting. Separate resolutions are proposed on all

substantive issues and voting is conducted by a poll. The Board

believes this method of voting is more democratic than voting via a

show of hands since all shares voted at the meeting, including proxy

votes submitted in advance of the meeting, are counted. In line with

our sustainability commitment, we do not issue hard copy forms of

proxy in the post. Instead, we ask shareholders to appoint a proxy

online via the Registrar’s portal.

Dr Karen Miller

Independent Non-Executive Director,

Inductionprogramme

Karen’s induction programme entailed

a number of interactive sessions with

members of the senior management team.

These briefing sessions were supported

by asset visits guided by the asset

managersresponsible for the assets.

For each resolution, shareholders will have the opportunity to vote for

or against or to withhold their vote. Following the meeting, the results

of votes lodged will be announced to the London Stock Exchange

and displayed on the Company’s website.

Anti-corruption and anti-bribery

We are committed to the highest legal and ethical standards in every

aspect of our business. It is our policy to conduct business in a fair,

honest and open way, without the use of bribery or corrupt practices

to obtain an unfair advantage. We provide clear guidance for

suppliers and employees, including policies on anti-bribery and

corruption, anti-fraud and code of conduct. All employees have

received updates on these issues during the year and the Anti-

Corruption and Anti-Bribery policy has been updated and

communicated to staff.

Human rights

Being mindful of human rights, the Company has a Modern Slavery

policy to ensure that all of its suppliers are acting responsibly and are

aware of the risks of slavery, human trafficking and child labour within

their own organisation and supply chain. The Modern Slavery

statement is updated and published each year.

Areas Covered Sessions provided by

Business Plan

CEO

Succession Planning

Valuations

Salary Structure

Relationship with Auditors

CFO

Most Recent Audit

Liabilities

Internal Controls

Head of Financial Reporting

Internal Audit

Risk management/Insurance

Non Audit Services

Business Planning

Management Reporting

Board Procedures

Company Secretary

Corporate Governance

Terms of Reference

Board/Director Obligations Training

Meetings/Year Plan

Policies: Whistleblowing; ShareDealing

Share Schemes

Organisation

Chief Operating and People Officer

Culture

HR Policies

Investor Relations

Investor Relations & Corporate

Communications Director

Communications Programme

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Board effectiveness review

In order to evaluate its own effectiveness, the Board undertakes

annual effectiveness reviews using a combination of externally

facilitated and internally run evaluations over a three-year cycle.

The cycle of the Board evaluations is summarised as follows:

YEAR 1 (FY21)

Externally facilitated Board evaluation using interviews facilitated

by Ceradas Limited, a board effectiveness consultancy with no

other connections to the Company

▼

YEAR 2 (FY22)

Follow up on actions prepared in response to the Year 1

evaluation, using internally facilitated questionnaires reviewed

by an external board evaluator

▼

YEAR 3 (FY23)

Continued follow up on actions arising from the previous

two years using internally facilitated questionnaires

During FY22 Ceradas Limited, a board effectiveness consultancy

with no other connections to the Company followed up on the review

undertaken in FY21 with a follow-up questionnaire based on the

actions identified in FY21 and the development of the strategy in

FY22. The questionnaires were internally distributed and completed

by all of the Directors. Ceradas reviewed the questionnaires and

noted that there had been a very healthy level of engagement

with the questionnaire. It was clear from a number of the responses

that there were high levels of satisfaction in most key areas of

Board activity.

The following recommendations were made:

Recommendations

• Make more time for more longer-term strategy discussions in

the Board timetable

• Schedule more informal meetings as a Board post-Covid

• Consider further mechanisms for the Board to meet and

engage with stakeholders

• Consider a more systematic approach to succession planning

and diversity

▼

Progress:

• Strategy is discussed and monitored at each Board meeting

and dedicated strategy sessions are included in the Board

timetable

• Board dinners prior to some of the Board meetings and social

events with staff have been arranged and attended

• The Board already received regular updates on stakeholders

and met with staff and shareholders but felt that they wished

to meet other stakeholders face-to-face post the pandemic.

A series of asset and retailer visits were therefore arranged

during FY23

• A table of tenure deadlines has been considered by the

Nomination Committee to systematically plan the replacement

of Non-Executive Directors when necessary. A detailed Board

Diversity Policy has been updated and approved. The Group

Diversity Policy is also being updated.

FY23 process

For FY23 a follow-up questionnaire based on the actions identified

in FY22 and the development of the strategy in FY23 was internally

distributed and completed by all of the Directors. We will report on

the outcomes of this review in next year’s Annual Report and on the

progress made during the year.

Corporate Governance continued

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Dear Shareholders

I am pleased to present the Nomination Committee Report for 2023.

Monitoring the balance of skills on the Board to match our strategy

and succession planning has continued to be the key focus for the

Committee this year.

Kay Chaldecott stepped down from the Board at the AGM in 2022. Much of the Committee

activity in FY22 and some of FY23 was therefore seeking a replacement for Kay. On 30 May

2022 we were delighted to welcome Dr Karen Miller to the Board. Further details of Karen’s

appointment and induction process can be found later in this report.

The Committee’s focus for FY24 will be the continued succession planning and

diversity priorities.

Baroness Ford

Chair

14 June 2023

Nomination Committee Report

Nomination Committee

responsibilities

• Regularly review the structure, size

and composition of the Board and

its Committees

• Review the leadership and

succession needs at Board and

Executive Committee level

• Identify and nominate

for approval candidates to fill

Board vacancies

• Evaluate the Board’s diversity

and balance of skills

• Evaluate the performance

of the Board

• Review the time needed to fulfil the

roles of Chair, Senior Independent

Director and Non-Executive Directors

Nomination Committee membership

Our Committee consists of four Independent Non-Executive Directors and the Chair of

the Board (biographies are available on pages 98 and 99).

• Margaret Ford: Committee Chair

• Alastair Miller

• Colin Rutherford

• Charlie Parker

• Karen Miller (appointed to the Committee on 30 May 2022)

How the Committee operates

• At least two meetings a year. During the year the Committee met three times

• Only Committee members attend meetings but we also invite the Chief Executive

Officer and the Chief Operating and People Officer to assist with succession

discussions and to brief the Committee on the views of the executive management

• The Committee has formal Terms of Reference and reviews these annually.

Copies can be found on our website at www.nrr.co.uk

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Less than three years

Three to six years

Six to ten years

FY23 Nomination Committee Activity

May

• Complete NED Board appointment process – consideration

and approval

• Draft Nomination Committee Report in Annual Report

▼

September

• Board evaluation review – report actions and outcome

• Chairman evaluation

▼

February

• Board Diversity policy statement

• Annual review of external directorships and time

commitments required from Non-Executive Directors

prior to re-election

• Terms of Reference review

Succession planning and recruitment process

The Committee considers succession planning a key element of its

remit. It recognises the importance of creating robust succession

plans for both the Board and executive management so that they

can fulfil the Company’s long-term strategy.

The Committee acknowledges that succession plans should be

regularly reviewed to enable employees and Board members to

maintain the skills and experience necessary to ensure the continuing

success and good governance of the Company.

The need to focus on succession planning continued from FY22 into

FY23 with the requirement to replace Kay Chaldecott by the 2022

AGM. The balance of skills on the Board was assessed prior to

commencing the recruitment process and the Committee

acknowledged that there was a need for a Board role with strong

environmental credentials. Following presentations from various

recruitment consultants, Nurole Limited, a global executive search

consultancy with no other relationship with the Group, was appointed

to conduct an external search for a Non-Executive Director. Nurole

Limited was made aware of the Company’s Diversity Policy and was

provided with a scope for the role that had been discussed and

agreed by the Committee. As part of the interview process a number

of members of the Board, including the Chair and Allan Lockhart,

interviewed a shortlist of candidates. Following a detailed due

diligence and referencing process and an opportunity to meet

othermembers of the Board individually, the Committee unanimously

recommended Dr Karen Miller to the Board. Karen joined the Board

on 30 May 2022 and immediately commenced an extensive

induction process and detailed on page 107.

Independence and time commitment

The Nomination Committee is of the opinion that the Non-Executive

Directors and the Chair remain independent, in line with the definition

set out in the 2018 Code, and are free from any relationshipor

circumstances that could affect, or appear to affect, their independent

judgement. The balance of directors (excluding theChair) is two

Executive Directors and four independent Non-Executive Directors.

The Committee regularly reviews the time commitments of the

Non-Executive Directors and none are considered overboarded.

Gender balance at the year end

Female Male

Board 2 29% 5 71%

Executive Committee 2 40% 3 60%

Direct Reports of Executive Committee 12 52% 11 48%

Group 23 50% 23 50%

Composition of the Board at the year end

Length of Directors’ tenure

Chair

Executive Directors

Non-Executive Directors

(Independent)

Nomination Committee Report continued

110

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

The Committee regularly reviews the balance of skills on the Board to ensure that they match the Company’s strategy.

Board skills matrix Executive Directors Non-Executive Directors

Allan Lockhart Will Hobman Margaret Ford Alastair Miller Dr Karen Miller Charlie Parker

Colin

Rutherford

Property asset management ✓ ✓ ✓ ✓

Regeneration and development ✓ ✓ ✓ ✓ ✓

Financial and banking ✓ ✓ ✓ ✓

Environmental ✓ ✓ ✓ ✓

Social and Governance ✓ ✓ ✓ ✓ ✓ ✓ ✓

Capital allocation and cost efficiency ✓ ✓ ✓ ✓ ✓ ✓

Capital partnerships ✓ ✓ ✓ ✓

Commercial leadership ✓ ✓ ✓ ✓ ✓ ✓

Mergers and acquisitions ✓ ✓ ✓ ✓

Public sector partnerships ✓ ✓ ✓ ✓

Workforce well-being ✓ ✓ ✓ ✓ ✓ ✓

Board and Company diversity

Company policy

As a Company, we are committed to a culture of diversity and

inclusion in which everyone is given equal opportunities to progress

regardless of gender, race, ethnic origin, nationality, age, religion,

sexual orientation or disability. When recruiting, the Company has

always considered all aspects of diversity during the process. The

Company is very mindful of the need to strive to create as diverse a

Company as possible, and to create as many opportunities as

possible for nurturing emerging female talent. The Company always

ensures there is a selection of candidates who have a good balance

of skills, knowledge and experience. The Committee places particular

value on experience of operating in a listed company, experience of

the real estate and retail sectors, and financial or real estate training.

The Company aims to recruit the best candidates on the basis of their

merit and ability.

Board policy

During the year the Board reviewed and updated its diversity policy.

The updated policy sets out the approach to diversity on the Board

and its purpose is to ensure an inclusive and diverse membership of

the Board and its Committees resulting in optimal decision-making

and assisting in the development of a strategy which promotes the

success of the Company for the benefit of its members as a whole

having regard to the interests of other stakeholders. The Policy

applies to the Board and Board Committees, but sits alongside the

Group Equal Opportunities Policy, and other associated Group policies

that set out our broader commitment to diversity and inclusion.

The Board acknowledges the benefits of greater diversity,

includinggender diversity and remains committed to ensuring

thatthe Company’s directors bring a wide range of skills, knowledge,

experience, backgrounds and perspectives. The Board supports

therecommendations of the Davies Review (Women on Boards),

theHampton-Alexander Review and the Parker Review and intends

to consider the recommendations when contemplating future

appointments to the Board.

Policy objectives:

The Board aspires to maintain a balance such that:

• At least two members of the Board are female, with a long-term

aspiration to achieve no less than 40% female representation on

the Board; and

• In the longer-term, at least one director will be from a non-white

ethnic minority background.

while recognising that:

• This balance may not be achieved until further Directors are

replaced at the end of their tenure;

• On an ongoing basis, periods of change in Board composition may

result in temporary periods when this balance is not achieved;

• All appointments must continue be made on merit; and

• New appointees embody the culture and values of the Group.

Diversity (including gender and ethnicity) will be taken into

consideration when evaluating the skills, knowledge and experience

desirable to strengthen the Board and when making appointments.

The Board supports and monitors management’s actions to increase

the proportion of senior leadership roles held by women, people from

ethnic minority backgrounds and other under-represented groups

across the Company in support of the Hampton-Alexander Review

and Parker Review recommendations.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Number of Board

members Percentage of the Board

Number of senior

positions on the Board

(CEO, CFO, SID, Chair)

Number in executive

management

Percentage of executive

management

Men 5 71% 3 3 60%

Women 2 29% 1 2 40%

Not specified/prefer not to say – – – – –

Number of Board

members Percentage of the Board

Number of senior

positions on the Board

(CEO, CFO, SID, Chair)

Number in executive

management

Percentage of executive

management

White British or other

White(including minority/

whitegroups)

7 100% 4 5 100%

Mixed/Multiple ethnic groups

Asian/Asian British

– – – – –

Black/African/Caribbean/Black

British Other ethnic group,

including Arab

– – – – –

Not specified/prefer not to say – – – – –

LISTING RULES

(LR 9.8.6R (9)) and (LR 14.3.33R(1))

As at 31 March 2023 the Company had not met all of the targets

of the listing rules diversity and inclusion guidelines as follows

Listing rule requirement Detail

At least 40% of the board are women The Board comprises two female Directors and five male Directors, equivalent to

29% female representation. The Board’s policy is to ensure that at least two members

of the Board are female, and that the Board has a long-term aspiration to achieve no less

than 40% female representation on the Board. As the Board has only seven Directors,

Board vacancies are not frequent. The most recent Board appointment was female but

this has not increased the female representation as the incoming female replaced an

exiting female.

At least one of the senior board positions

(Chair, Chief Executive Officer (CEO), Senior

Independent Director (SID) or Chief Financial

Officer (CFO)) is awoman.

The Chair of the Board is female.

At least one member of the board is from a

minority ethnic background (which is defined

by reference to categories recommended

by the Office for National Statistics (ONS))

excluding those listed, by the ONS, as

coming from a white ethnic background).

There are currently no Board members that are from a non-white ethnic background.

As is the case with female representation with a small Board with a low turnover of Directors

the targets set by the listing rules will take time to achieve. The Board aspires that in the

longer term, at least one Director will be from a non-white ethnic minority background.

Nomination Committee Report continued

112

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Audit, risk and internal control

Dear Shareholders

I am pleased to present the Audit Committee Report for 2023. The Report provides an outline

of the activities carried out by the Committee in accordance with its terms of reference as it

supports the Board and the Company’s governance structure and activities.

During the year, the Committee has invited certain third parties to carry out further reviews

and follow up checks of some of our systems and procedures as part of our continued

programme of internal audit reviews. Having carried out a review of the design and

effectiveness of the key controls to manage cash collection and bank accounts within the

Group in FY22, BDO were invited back in FY23 to assess the systems put in place to address

the four low to medium risk recommendations for improvement made at their previous review.

Bright Cyber were also invited back in FY23 to undertake a review of Cyber Security and IT

Systems in a sample of our shopping centres, having reviewed the Group’s Head office

systems in FY22. The Committee has also reviewed the significant financial reporting matters

and judgements identified by the finance team and PwC through the external audit process,

and the approach to addressing those matters is set out in the table on page 115 of this report.

During the year the Non-Executive Directors have visited a number of the assets. This

provides context to the reports received. It also enables us to challenge valuer and auditor

assumptions by having first hand knowledge of the assets and their management.

Our regular programme of meetings and discussions, supported by our interactions with the

Company’s management, external auditors and property valuers and the quality of the reports

and information provided to us, enables the Committee members to effectively discharge our

duties and responsibilities.

Colin Rutherford

Audit Committee Chair

14 June 2023

Audit Committee

responsibilities

• Oversight of the Group’s relationship

with its external auditors, PwC,

including their remuneration

• Monitoring the integrity of the half

year and annual financial statements

before submission to the Board

• Discussing any issues arising from

the half year review and year end

audit of the Group

• Reviewing significant financial

reporting matters and judgements

• Reviewing the effectiveness of the

Group’s system of internal controls

• Reviewing the Group’s whistleblowing

procedures and reports to the Board

• Reviewing and monitoring the

Group’s risk management processes

• Conducting an annual review of

the need to establish an internal

audit function

• Oversight of third-party internal

audit workstreams

• Monitoring and annually reviewing the

auditor’s independence, objectivity

and effectiveness of the audit process

• Reviewing the Company’s

ESG progress.

Audit Committee Report

Audit Committee membership

Our Committee consists of four Independent Non-Executive Directors:

(biographies are available on pages 98 and 99).

• Colin Rutherford: Committee Chair

• Alastair Miller

• Charlie Parker

• Karen Miller (appointed to the Committee on 30 May 2022)

How the Committee operates

• Each Committee member is independent and has broad commercial experience

• Colin Rutherford has significant, recent and relevant financial experience and

was previously the Chairman of the Audit Committee of Mitchells & Butlers plc

• Alastair Miller is a Chartered Accountant and was previously the Chief Financial Officer

of New Look Group and has significant, recent and relevant financial experience

• The Committee as a whole has competence relevant to the sector

• During the year the Audit Committee held five meetings

• The Chief Financial Officer and the Group’s external auditors are invited to attend

the Committee meetings.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

FY23 Audit Committee activity

May

• Meeting with the Property Valuers

▼

May

• External Auditors’ Report to the Committeee

• Internal Controls Review

• Gifts and Hospitality register

• Going Concern assessment

• Viability statement assessment

• Risk Review and Principal Risks

• ESG achievements

• Preliminary results

• Fair, Balanced and Understandable review

• Review Annual Report for recommendation to the Board

• Draft Audit Committee Report in Annual Report

• Meeting with External Auditors without management present

• Re-appointment of External Auditors recommendation.

▼

November

• Meeting with the Property Valuers

▼

November

• Going Concern Review – report actions and outcome

• External Auditor’s Plan

• External Auditor’s Report to the Committee

• Internal controls – updates from third parties

• Review of Principal Risks

• Half year results

• Meeting with External Auditors without management present

▼

February

• External Auditor Audit Plan Update

• Risk Review

• Consider requirement for an internal audit function

• Review Whisleblowing

• Auditor Effectiveness

• Annual Review of Terms of Reference

Relationship with the auditors

The Committee has primary responsibility for managing the

relationship with the external auditors, including assessing their

performance, effectiveness and independence annually and

recommending to the Board their reappointment or removal.

PricewaterhouseCoopers LLP (PwC) were appointed as the Group’s

external auditors in 2019. The Committee keeps under review the

need for future tenders in accordance with current regulations and

subject to the annual assessment of the auditor’s effectiveness and

independence.

Chris Burns is the PwC lead audit partner and, in-line with the policy

on lead audit rotation, he is expected to rotate off the audit ahead of

the 2025 audit.

During the year, the members of the Committee met twice with

representatives from PwC without management present, to ensure

that there are no issues in the relationship between management and

the external auditors which it should address. There were none.

External auditor

The Committee considers the nature, scope and results of the

external auditors’ work and reviews, develops and implements a

policy on the supply of any non-audit services that are to be provided

by the external auditors. It receives and reviews reports from the

Group’s external auditors relating to the Group’s Annual Report and

Accounts and the external audit process.

In respect of the audit for the financial year ended 31 March 2023,

PwC presented their Audit plan (prepared in consultation with

management) to the Committee. The Audit plan included an

assessment of audit risks, audit scope, independence, the terms

of engagement, fees and robust testing procedures.

The Committee approved the implementation of the plan following

discussions with both PwC and management.

Audit and non-audit fees

Audit fees for the financial year ended 31 March 2023 were £499k.

The Company has a non-audit services policy in place which limits

PwC to working on the audit or such other matters where their

expertise as the Company’s auditor makes them the logical choice

for the work. This is to preserve their independence and objectivity.

The Company paid £95k in non-audit fees to PwC for the financial

year ended 31 March 2023. The non-audit fees relate solely to

PwC’s review of the interim results for the six months to

30 September 2022.

Effectiveness and independence

The Chair of the Committee speaks regularly to the external audit

partner to ascertain if there are any concerns, to discuss the audit

reports and to ensure that the external auditors have received the

support and information requested from management.

In accordance with the guidance set out in the Financial Reporting

Council’s ‘Practice aid for audit committees’, the assessment of the

external audit has not been a separate compliance exercise, or an

annual one-off exercise, but rather it has formed an integral part of

the Committee’s activities. This has allowed the Audit Committee to

form its own view on audit quality and on the effectiveness of the

external audit process, based on the evidence it has obtained

throughout the year.

Audit Committee Report continued

114

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Having regard to these matters the Committee has considered the effectiveness of the external audit process and feels that the external

auditors have demonstrated professional scepticism and challenged management’s assumptions where necessary.

The Audit Committee is satisfied with the scope of PwC’s work, and that PwC continues to be independent and objective. The Committee is

therefore pleased to recommend that PwC be re-appointed as the Group’s external auditors at the 2023 AGM.

Key judgements and estimates

The Committee reviewed the external reporting of the Group including the interim review, quarterly announcements and the Annual Report.

In assessing the Annual Report, the Committee considered the key judgements and estimates.

The significant issue considered by the Committee in respect of the year ended 31 March 2023, which contained a significant degree of

estimation uncertainty, is set out in the table below.

Significant issue How the issue was addressed

Valuation of properties

Changes in key estimates can have a significant impact on the

valuation of properties. The Group has a property portfolio

recognised on its Consolidated Balance Sheet valued by external

valuers at £551.5 million at 31 March 2023.

The Committee and management met with Colliers, Knight Frank and

Kroll (previously Duff and Phelps) (the Group’s external valuers) on

several occasions to discuss the valuation of the assets and

understand the process that was followed, the key estimates used

and to ensure a robust and independent valuation had taken place.

The meetings were productive and management and the Committee

have confirmed that they continue to adopt the valuations as being

the fair valuation of the properties as at the reporting date. In addition

the external auditors have performed additional audit procedures

over the valuer judgements and estimates and presented challenges

which were reported to and discussed with the Committee.

Sources of evidence obtained and observations dring the year:

By referring to the FRC’s Practice aid on audit quality. The Committee has looked to this practice aid for guidance and has

ensured that assessment of the external audit is a continuing and

integral part of the Committee’s activities.

Observations of, and interactions with, the external auditors. The Committee has met with the external audit partner without

management at least twice during the year and has noted that PwC

was performing well and the working relationship was good.

The audit plan, the audit findings and the external auditors’ report. The Committee scrutinises these documents and reviews them

carefully at meetings and by doing so has been able to assess the

external auditors’ ability to explain in clear terms what work they

performed in key areas and also assess whether the description used

is consistent with what they communicated to the Committee at the

audit planning stage. The Committee has also regularly challenged

these reports in the meetings.

Input from those subject to the external audit, including a detailed

questionnaire completed by the finance team.

The Committee has requested the insights from the Chief Financial

Officer and the Finance team during the external audit process. This

year the Finance team completed a detailed questionnaire about the

audit process and the working relationship with the external auditors.

This questionnaire was considered in detail by the Committee in one

of its meetings.

115

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

The Board is ultimately responsible for the Group’s system

of internal controls and risk management and discharges its

duties in this area by:

• holding regular Board meetings to consider the matters

reserved for its consideration;

• receiving regular management reports which provide an

assessment of key risks and controls;

• scheduling regular Board reviews of strategy including

reviews of the material risks and uncertainties (including

emerging risks) facing the business;

• ensuring there is a clear organisational structure with defined

responsibilities and levels of authority;

• ensuring there are documented policies and procedures in

place and reviewing these policies and procedures regularly;

• reviewing regular reports containing detailed information

regarding financial performance, rolling forecasts, actual and

forecast covenant compliance, cashflows and financial and

non-financial KPIs; and

• visiting the assets to provide context to the reports received.

Risk management and internal controls

Internal control structure

The Board oversees the Group’s risk management and internal

controls and determines the Group’s risk appetite. The Board has,

however, delegated responsibility for review of the risk

managementmethodology and the effectiveness of

internalcontrolsto the Audit Committee.

The Group’s system of internal controls includes financial, operational

and compliance controls and risk management. Policies and

procedures, including clearly defined levels of delegated authority,

have been communicated throughout the Group. Internal controls

have been implemented in respect of the key operational and

financial processes of the business. These policies are designed to

ensure the accuracy and reliability of financial reporting and govern

the preparation of the Financial Statements. During the year a

number of follow up internal audit reviews have been commissioned

to provide the Committee with additional comfort that the Group’s

system of internal controls remains fit for purpose and robust.

The process by which the Audit Committee has monitored and

reviewed the effectiveness of the system of internal controls and risk

management during the year has included:

• ongoing analysis and review of the Group’s risk register;

• overseeing further ’deep-dive’ discussions of the Group’s risk

risk scoring;

• further ‘deep-dive’ audits on specific risks; this year it was

cyber security and cash controls;

• reviewing the assessment of key risks, the process of

reporting these risks and associated mitigating controls,

with particular emphasis on emerging risks; and

• updates from the ExCo’s quarterly detailed assessment of

the risk register.

The effectiveness of the Company’s risk management and internal

control systems is reviewed annually and was last reviewed by the

Committee in May 2023. The review concluded that:

• the systems established by management to identify, assess

and manage risks, including emerging risks are effective; and

• the assurance on risk management and internal control is

sufficient to enable the Committee and Board to satisfy

themselves that they are operating effectively.

The Committee is satisfied that the risk management framework is

effective and did not identify any failing in the control systems.

Further details of the Company’s risk management process, together

with the principal risks, can be found in the Principal Risks and

Uncertainties section.

Audit Committee Report continued

116

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Internal audit function

The Group does not have an internal audit team. The need for this is

reviewed annually by the Committee. Due to the relative lack of

complexity and the outsourcing of the majority of the day-to-day

operational functions, the Committee continues to be satisfied that

there is no requirement for such an in-house team. The Committee

does however look to third-parties to provide an internal audit review

function. This year the Committee commissioned the following follow

up internal audit reviews:

Cyber security

Cyber security was a new principal risk in 2021. A cyber event can

affect any company and the number of such events has increased

significantly in the UK particularly with more staff working from home.

To address this risk and ensure the Group’s systems were properly

protected, Bright Cyber were requested to undertake a review of

the Group’s IT security and systems. Last year Bright Cyber carried

out a review of the Group Head office systems and found the IT

systems were secure and fit for purpose. During FY23 Bright Cyber

were requested to undertake a review of Cyber Security and IT

Systems in a sample of our shopping centres. There were a number

of areas where Bright Cyber have recommended improvements

which have already been implemented or will be actioned during

the coming months.

Cash controls

As part of the internal audit plan in FY22 BDO were requested to

scope and carry out a review to provide assurance over the design

and effectiveness of the key controls to manage cash collection and

bank accounts within the Group. BDO’s review highlighted that

generally there was a sound system of internal control designed to

achieve system objectives and there were a number of areas of good

practice with some exceptions. BDO were therefore able to provide

moderate assurance over both the design and the operational

effectiveness of the systems the Group had in place. Four low to

medium risk recommendations for improvement were made by the

BDO review. BDO were therefore invited back in FY23 to assess the

systems that had been put in place to address these four low to

medium risk recommendations for improvement made at their

previous review. BDO confirmed that their recommendations had

been incorporated into the systems.

Whistleblowing Policy

The Committee conducts an annual review of the Group’s

Whistleblowing Policy to ensure it remains up to date and relevant

and reports its findings to the Board. Training on whistleblowing is

provided to staff annually to capture new staff and to remind existing

staff of the procedures. The Committee provides feedback to the

Board on the Whistleblowing Policy and procedures and

effectiveness of the policy at least every six months. There have

never been any concerns raised through the whistleblowing process

or through any other process to the Committee.

Other compliance policies

The Committee reviews the Gifts and Hospitality register at least

twice a year. During the year a Conflicts of Interest Policy was

approved by the Committee and recommended for approval to the

Board. The Conflicts of Interest register will also now be regularly

reviewed by the Committee.

Statement of compliance

The Company is not a constituent of the FTSE 350, however the

Company confirms on a voluntary basis that it has complied with

terms of The Statutory Audit Services for Large Companies Market

Investigation (Mandatory User of Competitive Tender Processes and

Audit Committee Responsibilities) Order 2014 (the “Order”)

throughout the year. In addition to requiring mandatory audit

re-tendering at least every ten years for FTSE 350 companies, the

Order provides that only the Audit Committee, acting collectively or

through its Chair, and for and on behalf of the Board, is permitted:

• to the extent permissible in law and regulation, to negotiate and

agree the statutory audit fee and the scope of the statutory audit;

• to initiate and supervise a competitive tender process;

• to make recommendations to the Directors as to the auditor

appointment pursuant to a competitive tender process;

• to influence the appointment of the audit engagement partner; and

• to authorise an auditor to provide any non-audit services to the

Group, prior to the commencement of those non-audit services.

Viability statement and going concern

The Committee has reviewed the basis for the Company’s viability

Statement that is drafted with reference to the financial forecasts for

the next three years. This period of assessment is aligned to

performance measurement and management remuneration and, in

the opinion of the Committee, this period of assessment strikes the

optimal balance of allowing the impact of strategic decisions to be

modelled while maintaining the accuracy of underlying forecast

inputs. The Committee places additional scrutiny on the assumptions

used in the forecasts to ensure they are appropriate. The Committee

provides advice to the Board on the Viability Statement.

The Committee ensured sufficient review was undertaken of the

adequacy of the financial arrangements, cash flow forecasts and

lender covenant compliance. The Committee further tested the

Group’s performance against its stated strategy and its future plans.

Accordingly, the Committee recommended to the Board that the

statement be approved.

The Committee further focused on the appropriateness of adopting

the going concern basis in preparing the Group’s financial statements

for the year ended 31 March 2023 and satisfied itself that the going

concern basis of presentation of the financial statements and the

related disclosure is appropriate.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Experienced team

Senior review

• a core experienced team is responsible for the co-ordination

of submissions, verification, review and consistency

• the narrative sections are drafted by the members of the team with

specific responsibility for each area, such as the Chairman, the CEO,

the CFO, Sustainability Manager, Director of Communications and

Investor Relations, and the Company Secretary

As narrative sections are prepared they are circulated to Board and ExCo members to review and comment

Staff review

Controls and confirmation

• the Committee satisfies itself that the controls over the accuracy

and consistency of information presented in the Annual Report

are robust and that the information is presented fairly (including

the calculations and use of alternative performance measures)

• the Committee confirms to the Board that the processes

and controls around the preparation of the Annual Report

are appropriate, allowing the Board to make the “fair,

balanced and understandable” statement in the Directors’

Responsibilities Statement

Committee oversight and review

The draft Annual Report is given to other staff members not involved in the drafting

process to read and provide feedback on its fairness, balance and understandability

The Committee reviews the Annual Report on behalf of the Board, taking into account the comments made

by the Board, reports from management and reports issued by PwC and makes recommendations to the Board

Fair, balanced and understandable assessment

The Directors are required to confirm that they consider, taken as a whole, that the Annual Report is fair, balanced and understandable

and that it provides the information necessary for shareholders to assess the Group’s position and performance, business model and strategy.

To ensure this is the case the following process is in place:

Audit Committee Report continued

118

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Remuneration Committee Report

Dear Shareholders

On behalf of the Board, I am pleased to present the Remuneration Committee Report for the

financial year ended 31 March 2023. In this statement I have summarised the link between

remuneration and performance and our decisions on remuneration for FY23. I have also

summarised the proposed changes to the Directors’ Remuneration Policy for FY24-FY26.

FY23 has been a successful year for NewRiver despite the wider economic and geopolitical

uncertainties. Our community assets have proven to be resilient throughout this period and have

under-pinned our performance for the year. The Committee has had regular updates on workforce

pay and benefits throughout this year and the health and wellbeing of our staff has remained a key

priority. We are ever mindful of the inflationary pressures which are driving up the cost of living and

have recognised this in pay awards for our staff for FY24.

Remuneration Policy

Our Remuneration Policy was approved by shareholders in July 2020 and is due for renewal at our

2023 AGM. Our current policy has served the Company well over the past three years, enabling us

to be flexible in the payments to Executive Directors, and to recruit a new CFO. It has provided a

good overall link between pay and performance. On this basis, our review concluded that only a few

minor amendments were necessary to align to market best practice. A summary of the key changes

to the policy are set out on page 122.

Implementation of the Policy in FY23

Base salary

As reported in the FY22 Remuneration Report, base salaries remained unchanged during FY23

for both the Executive Directors and the members of ExCo. The wider workforce received salary

increases that took into account inflation and market competitiveness.

Annual bonus

The FY23 annual bonus was based on Total Return (25%), Earnings yield (25%), LTV (10%), TAR

Return (15%) and strategic objectives including ESG targets (25%). Operational performance over

the year was excellent, which was reflected in the Total Return, Earnings Yield and LTV measures

all exceeding the stretch performance targets. There was also strong performance against the non

financial strategic targets. The only aspect where we failed to achieve the target range was in

relation to TAR, where our performance, alongside that of the entire sector, was impacted by the

significant property devaluations in the second half of 2022. The resultant out-turn was 82.5% of

maximum for Allan Lockhart and Will Hobman. The Committee is comfortable that the formulaic

bonus outcome reflects the wider business performance of the Company. 30% of the bonus will

be deferred in shares for two years.

Long-term incentive plan

The FY21 LTIP Awards will vest to the extent that the relative TAR (50%) and Total Shareholder

Return (50%) performance targets are met. The relative TAR targets were assessed against

performance to 31 March 2023. As the minimum hurdle requirement was not met, this element of

the award will lapse. For the TSR element, performance is assessed for a period of three years from

the date of grant. Therefore, the vesting level under the TSR element cannot be ascertained until

August 2023. Based on a recent assessment of the Company’s TSR, the TSR element is expected

to vest in full. On this basis, the total estimated vesting for this award is 50% of maximum. The

Committee considered wider business performance over the three-year performance period and

is comfortable that the formulaic vesting outcome is appropriate.

In addition to looking at our performance in the round, the Committee considered whether the

share price increase from grant represented a windfall gain. Over the period since the grant of the

FY21 award, our share price has increased from 63p to an average share price over the first quarter

of 2023 of 88.27p. Whilst being cognisant of the guidance from the Investment Association on

potential windfall gains from FY21 awards granted during the pandemic, we are not scaling back

the award on vesting because:

• The FY21 Award was scaled back by one third at grant (from 100% of salary to 67% of salary) to

ensure that the Executives did not benefit from a windfall gain.

• Relative TSR performance against the sector has been strong. Based on the TSR performance

to 31 January 2023, our TSR has exceeded the upper quartile TSR performance of other UK

REITs (62% vs 14%).

On this basis, the Committee decided not to exercise any discretion to reduce the overall

vesting outcome.

Remuneration Committee Report

119

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Other considerations during the year

Wider workforce engagement

During the year, the Committee had oversight of the reward and

compensation packages that operate across the Company, which are

considered competitive. I am the appointed designated Non-

Executive Director who has the responsibility of ensuring that the

Board successfully engages with the workforce. As a result of being a

small team there is naturally proximity between the Board and the

workforce which makes it easier for the Board to engage with staff

directly. I attend staff forums to ensure that there is an opportunity for

staff to raise questions or concerns directly with myself. We also use

our appraisal process to explain and discuss with employees how the

policy for Executive Directors aligns with the pay and conditions of

the workforce. Finally, NEDs have also engaged with employees in

the regional operations and found this to be particularly useful. The

executive remuneration policy and its implementation were not

raised as material issues during the year. Therefore, no amendments

were required to the remuneration policy or its proposed

implementation as a result of this engagement.

Shareholder engagement

Ahead of the 2023 AGM, we engaged with our largest investors to

understand their views on our proposed new policy and the proposed

implementation in FY24. Based on the feedback received from our

engagement, investors were supportive of the new policy and no

changes were required as a consequence of the investor feedback.

Implementation of the Policy in FY24

The implementation of the Remuneration Policy for FY24 is outlined

on pages 135 to 136. The Committee considered how remuneration

should be implemented for FY24. Part of this process was reviewing

current practice against both market and best practice, wider

workforce remuneration and pay ratios. The outcome of the review

was that our current approach remains appropriate.The key decisions

made by the Committee in relation to FY24 include:

Base salary: During the year the Committee reviewed the salary

increases for the wider workforce, taking into account high inflation

and the increase in cost of living. As a result, the wider workforce

received an average increase of 5%. The Committee reviewed the

base salary levels for Executive Directors and determined that the

salaries should be increased by 3%. This increase was materially

below the average workforce increase and also recognised that the

CEO's salary had not increased for several years.

Pensions: The Company currently contributes 15% of base salary for

Allan Lockhart. This will reduce at the end of forthcoming AGM to 4%

of salary, the rate applying to the workforce. Will Hobman’s Company

pension contributions are also 4% of base salary.

Annual Bonus: Executive Directors will have the opportunity to earn a

bonus up to a normal maximum of 125% of salary. In line with FY23,

75% of the bonus will be based on corporate and financial measures,

including Total Return, Earnings Yield, LTV and absolute growth in

Total Accounting Return (TAR). 25% will remain based on strategic

measures (including measurable ESG objectives consistent with the

Company’s ESG commitments and strategy). 30% of any bonus paid

will be deferred into shares for two years.

Long-term incentives: Grant levels will be 100% of base salary. In line

with FY23 grants, performance will be assessed against relative TSR and

relative TAR vs a peer group of UK REITs. Awards must be held by

Executive Directors for a further two years after vesting.

Closing remarks

We believe that the operation of our Remuneration Policy recognises

the experience of shareholders, employees and other stakeholders.

Bonuses have been awarded to the wider team to ensure alignment

with the level of bonuses awarded to the Executive Directors. In

recognition of the inflationary pressures on the wider workforce, staff

have received pay increases at higher percentage levels than the

Executive Directors and Members of the ExCo.

We welcome feedback and if shareholders have any questions about

remuneration generally, or the contents of the report, I can be

contacted through our investor relations email at info@nrr.co.uk.

My fellow Directors and I intend to attend the AGM and we would be

pleased to answer any questions you may have about the

Committee’s work.

Alastair Miller

Committee Chair

14 June 2023

Remuneration Committee Report continued

120

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Remuneration at a Glance

FY23 Annual Bonus Performance

LTV

TAR Return

100%

90%

CorporateFinancial

Strategic

Corporate and financial measures (75% weighting)

Measure

Total return vs

IPD All Retail

Earnings yield (UFFO)

Director

Achievement (% of max)

Strategic measures (25% weighting)

Allan Lockhart

Will Hobman

Executive Pay in FY22/23

Total remuneration (£)

350k

700k

1.05m

1.4m

Allan

Lockhart

Will

Hobman

£1,295,657

£674,918

£984,462

£399,453

Salary

Pension

Benefits

Annual Bonus

LTIP

2022202320222023

FY21-23 Performance Share Plan

100%

Achievement (% of max)

50%

Measure

Relative TSR vs

Peer Group

Relative Total Accounting

Return vs Peer Group

Total

PSP

Implementation of Policy in FY24

Base Salaries Allan Lockhart: £484,100

Will Hobman: £334,750

Benefits No change

Pension Allan Lockhart: 15% of salary to reduce

atAGM 2023 to 4% of salary

Will Hobman: 4% of salary

Annual Bonus Maximum opportunity is 125% ofsalary

Performance conditions:

75% Corporate Targets

25% individual strategic objectives

30% deferred into shares for twoyears

Long Term

Incentive Plan

Grant levels at 100% of salary

Performance conditions:

Relative TSR (50%)

Relative TAR (50%)

Two-year post-vesting holding

period applies

Shareholding

requirements

200% of salary

1. Remuneration was pro-rated in 2022 because Will was appointed

during FY22. No value for the LTIP award vesting is included in 2023

as the award relates to his employment below board level.

121

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Remuneration Committee Report continued

Remuneration Policy

In accordance with the remuneration reporting regulations, the

remuneration policy as set out below is intended to apply, subject to

shareholder approval at the 2023 AGM to be held on 26 July 2023,

for a period of three years from that date.

Following a detailed review of the remuneration policy and

shareholder engagement, the following changes are proposed.

These are limited to modest amendments which do not substantively

alter the previous policy:

Pension

The policy has been updated to reflect that Executive Directors may

receive a pension contribution in line with the contribution available

to the wider workforce (currently 4% of salary). The CEO’s pension

will reduce from 15% of salary to 4% of salary from the date of the

2023 AGM.

Performance Share Plan

The policy wording in respect of performance conditions has been

broadened so that non-financial measures may be incorporated

alongside financial and stock market based measures. This will

provide greater flexibility to operate the policy in line with the

evolving business strategy including, potentially, the use of ESG

based measures. We have also flexibility for the dividend equivalent

calculation to take into account the holding period (where applicable)

and not just up to the point of vesting.

Shareholding guidelines

The post-employment shareholding guideline has been updated to

align with the IA guidelines and market best practice such that

Executive Directors will be required to retain 200% of salary for two

years post-cessation of employment (or the actual shareholding, if

lower). Previously the requirement reduced to 100% of salary for the

second year.

In addition, we have made some minor wording changes to the policy

to enhance clarity.

Decision making process for the determination,

review and implementation of the policy

When reviewing the remuneration policy, the Committee considers a

wide range of factors, including:

• The Company’s strategic priorities and KPIs and culture and values

• The remuneration policies and practices for the workforce and the

cascade of remuneration throughout the Company and where

practicable improving the consistency of the Executive Directors’

remuneration policy with that of the workforce

• The latest guidance from our institutional shareholders, investor

representative bodies, regulators and statutory requirements

• The overall market competitiveness of the senior

executives’ packages

To manage any potential conflicts of interest, the Committee ensures

that no individual is involved in discussions regarding their own

remuneration arrangements.

The implementation of the Policy is considered annually by the

Committee for the year ahead in light of the strategic priorities

and the wider stakeholder experience, whilst incentive targets are

also reviewed to check if they remain appropriate or need to

be recalibrated.

In addition to the decision-making process set out above, the

Committee addressed the following factors when determining the

remuneration policy and practices, as recommend by the UK

Corporate Governance Code:

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Principle Committee approach

Clarity

Remuneration arrangements should be transparent and

promote effective engagement with shareholders and

the workforce.

• As noted above there is a consistent approach taken, where possible, in

relation to the application of the remuneration policy throughout the Company.

For instance, all employees participate in an annual bonus plan and the PSP.

• We consult with employees to explain how the policy for Executive Directors

aligns with the pay and conditions of the workforce other than, for instance,

where there are more stringent requirements in the Executive Directors’ policy

for corporate governance reasons.

Simplicity

Remuneration structures should avoid complexity and their

rationale and operation should be easy to understand.

• The components of our Remuneration Policy are consistent throughout the

Company so they are simple to operate and communicate.

Risk

Remuneration arrangements should ensure reputational

and other risks from excessive rewards and behavioural

risks that can arise from target-based incentive plans are

identified and mitigated.

• We look carefully at the range of likely performance outcomes when setting

performance target ranges and use discretion where this leads to an

inappropriate pay outcome.

• Bonus deferral, holding periods on LTIP awards, shareholding requirement and

clawback and malus provisions all help to mitigate risk.

Predictability

The range of possible values of rewards to individual

directors and any other limits or discretions should

be identified and explained at the time of approving

the policy.

• Incentive plans are determined based on a proportion of base salary so there

is a sensible balance between fixed pay and performance-linked elements.

• There are provisions to override the formula driven outcome of incentive plans

and deferral and clawbacks to minimise the likelihood of a poor link between

reward and performance.

Proportionality

The link between individual awards, the delivery

of strategy and the long-term performance of the

company should be clear. Outcomes should not

reward poor performance.

• Incentive plans are determined based on a proportion of base salary so there

is a sensible balance between fixed pay and performance-linked elements.

• There are provisions to override the formula driven outcome of incentive plans

deferral and clawbacks to ensure that poor performance is not rewarded.

Alignment to culture

Incentive schemes should drive behaviours consistent

with company purpose, values and strategy.

• All staff are eligible for bonus plans which are approved by the Committee to

ensure consistency with Company purpose, values and the performance

measures are linked to the business strategy.

Remuneration Policy Table Executive Directors

Element

Purpose

& Link to Strategy Operation Maximum Performance Target

Fixed

Salary Market competitive

remuneration base

reflecting role,

responsibilities, skills

and experience

Normally reviewed annually,

effective 1 April, although salaries

may be reviewed more frequently

or at different times of the year if

the Committee determines this

is appropriate.

Salaries are set taking into account

the performance of the individual, the

responsibilities and size of the role,

salary increases across the Group

and market data for peer companies.

Paid in cash monthly.

There is no prescribed maximum.

Increases will typically be dependent

on the results of an annual review in

the context of the average increase

for the wider work force, inflation and

market data.

Increases will not normally be above

the level implemented across the

wider workforce. Increases may be

above this level, for example if there

is an increase in the scale, scope or

responsibility of the role.

Not applicable.

Pension To provide

competitive

post-retirement

benefits.

To assist with

recruitment and

retention.

The Executive Directors may

participate in the Company’s

defined contribution plan or receive

a cash supplement in lieu of pension

contributions.

A pension contribution is payable in

line with the pension available to the

workforce, currently 4% of salary. The

CEO’s pension contribution will reduce

from 15% of salary to this level from the

2023 AGM.

Not applicable.

Benefits To provide a

competitive and

cost-effective

benefitspackage.

To assist with

recruitment and

retention.

The Company provides a range of

non-pensionable benefits to Executive

Directors which may include medical

insurance, life assurance, permanent

health insurance, holiday and sick pay.

Other benefits such as relocation

allowances may be offered if

considered appropriate and

reasonable by the Committee.

Benefits are set at a level which the

Committee considers appropriate

when compared to the Company’s

listed real estate investment trust

peers.

There is no prescribed maximum.

Not applicable.

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Remuneration Committee Report continued

Executive Directors

Element

Purpose &

Link to Strategy Operation Maximum Performance Target

Variable

Bonus To incentivise

performance in

the reporting

year. Targets are

consistent with

the Group’s long

term strategy.

The deferral of a

proportion of the

bonus in shares

aligns directors’

interests with

those of

shareholders and

to discourage

short term

decision making.

All measures and targets will be reviewed

and set annually by the Committee at the

beginning of the financial year and levels

of award are determined by the

Committee after the year end based on

achievement of performance against the

stipulated measures and targets.

The Committee retains an overriding

discretion to adjust pay-outs from

formulaic performance condition

outcomes to ensure that overall bonus

payments reflect its view of corporate

performance during the year and are fair

to both shareholders and participants.

30% of the bonus must be deferred into

shares for two years.

Vesting of the deferred shares will be

subject to continued employment.

The value of the bonus does not

contribute to the pensionable salary.

Clawback and malus provisions apply.

The maximum bonus is 125%

of salary.

On target performance would result in

a bonus payment of 50% of maximum

bonus. Threshold performance would

result in bonus payment of up to 25%

of maximum bonus.

All measures and

targets normally relate

to a financial year of

the Company and are

reviewed on an annual

basis.

At least 50% of

the bonus will be

subject to financial

performance

conditions.

Performance

Share Plan

To incentivise

and reward the

delivery of returns

to shareholders

and sustained

long-term

performance.

Aligns the

Executive

Directors’

interests with

those of

shareholders.

Rewards and

helps retain/

recruit executives.

Discretionary grant of nil-cost options or

conditional awards of shares.

Awards normally vest three years from the

date of award.

Vesting of awards is subject to

satisfaction of performance targets

normally measured over a three-year

period.

The Committee retains an overriding

discretion to adjust the vesting level from

formulaic performance condition

outcomes to ensure that the overall level

of vesting reflects its view of corporate

performance over the performance period

and is fair to both shareholders and

participants.

A holding period of two years will apply

following vesting before participants are

entitled to sell their shares.

Clawback and malus provisions apply as

described in the notes to this table.

The maximum award level permitted

under the 2016 PSP plan rules and this

policy is 200% of salary. The normal

annual award is 100% of salary for all

Executive Directors.

Awards would not be increased above

100% of base salary without prior

consultation with shareholders.

25% of the award is payable at

threshold performance.

Performance targets

will apply over the

performance period.

The Committee will

determine the

applicable

performance targets

and their weightings to

ensure they are

appropriate.

Performance

conditions may be

based on financial,

stock market based

and/or non-financial

measures (including

strategic and ESG

measures). A majority

of the award will be

based on financial and

stock market based

measures.

Shareholding

Requirement

To encourage

long-term share

ownership and

support alignment

of interests with

shareholders.

At least half of the net shares vested under

the deferred annual bonus and the LTIP

must be retained until the shareholding

requirement is met.

During employment, Executive

Directors must build up a shareholding

worth 200% of salary.

After employment, Executive Directors

will be required to retain the lower of

the shareholding requirement during

employment or actual shareholding at

cessation for two years. The Committee

has the discretion to relax this

requirement in exceptional

circumstances (e.g. serious ill-health).

Shares that have been purchased

voluntarily may be excluded from the

post-cessation shareholding

requirement.

Not applicable

124

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Chair and Non-Executive Directors

Element

Purpose

& Link to Strategy Operation Maximum Performance Target

Fees To provide

market competitive

director fees.

Annual fee for the Chair.

Annual base fee for the

Non-Executive Directors.

Additional fees are paid to Non-Executive

Directors for additional responsibilities

such as being the Senior Independent

Non-Executive Director or chairing a

Board Committee.

Fees are reviewed from time to time

taking into account time commitment,

responsibilities and fees paid by

companies of a similar size and

complexity.

Payable in cash.

Expenses incurred by Non-Executive

Directors in connection with the fulfilment

of their roles are reimbursed (including

any personal tax due on such expenses).

Fee increases are applied in line

with outcome of the review.

Not applicable.

Notes on the remuneration policy table

Dividend equivalents

Dividend equivalent shares will be added to unvested awards

under the 2016 DBP and the 2016 PSP on a reinvested basis,

although this can be calculated in an alternative manner at the

discretion of the Committee. Dividends will accrue from the date of

grant to the vesting date or, if applicable, the last day of the holding

period.

Performance measures

Each year the Committee selects the most appropriate performance

measures and targets for the annual bonus plan and LTIP. The

measures selected will be aligned with Company strategy and key

performance indicators and performance targets are set with the

aim of setting stretching targets which incentivise and reward

improved performance.

Malus and clawback

In the event of gross misconduct, or the material misstatement of

financial information, or if an error is discovered in the calculation

of any incentive plan payments, or where there has been an issue

in relation to the company’s reputation, or corporate failure, the

Committee has discretion to exercise malus and clawback provisions

in respect of all cash bonus and share awards. The Committee may

reduce the vesting of awards prior to vesting and/ or require the

repayment or reimbursement of awards which have already vested

and been exercised across all incentive plans.

The Committee may operate clawback on the terms stated above

during the 36 months following the payment date of the annual

bonus or vesting date of an award granted on the terms of the 2016

PSP.

Discretion

The Committee may amend the remuneration policy to accommodate

minor changes for administrative or legislative purposes.

In relation to the operation of the incentive plans, the Committee has

certain discretions which include, but are not limited to, the following:

• selecting the participants in the plans;

• determining the timing of grants of awards and/or payments;

• determining the quantum of awards and/or payments (within the

limits set out in the remuneration policy);

• determining the extent of vesting based on the assessment

of performance;

• making the appropriate adjustments required in certain

circumstances (e.g. change of control or a capital reorganisation);

• determining “good” or “bad” leaver status for incentive plan

purposes and applying the appropriate treatment;

• determining the weighting, performance measures, and targets

for the annual bonus plan and the PSP from year to year; and

• if events occur that cause the Committee to determine that the

performance conditions and/or targets for the incentive plans are

unable to fulfil their original intended purpose, to adjust targets

and/or set different measures or weightings for the applicable

annual bonus and PSP awards.

Consideration of shareholders’ views

The Committee’s policy is to consult with major Shareholders in

respect of significant decisions on executive remuneration and has

done so regularly.

During the year the Committee consulted extensively in relation to

the proposed New Remuneration Policy and investor feedback

helped shape the proposals, particularly in relation to our approach to

executive pension provision.

125

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Remuneration Committee Report continued

How wider employee pay was considered during

the policy review

The Committee considered carefully the pay and conditions in the

workforce generally, as part of its review of the Directors’

remuneration policy. Alastair Miller as Remuneration Chair and also

the Non-Executive Director charged with staff engagement hosted a

staff forum to explain the Directors’ Remuneration Policy and how it

aligns with remuneration of the workforce and to take comments

from staff. All the Non-Executive Directors have visited a large range

of the assets during the year which has given them the opportunity to

meet with more junior staff and listen to their views.

The policy for Executive Directors is rolled out on a consistent basis

throughout the workforce. All staff participate in the Annual Bonus

Plan and Performance Share Plan and we have a consistent approach

in relation to benefits and pension, noting the CEO will be aligned

following the 2023 AGM. There are however some differences in the

Director’s Remuneration Policy compared to the policy for

employees. For example, the opportunity for the incentive plans

varies by seniority.

Service contracts and payments for loss of office

Executive Directors’ service contracts are terminable by either party

giving the other 12 months’ written notice. If notice is served by either

party, the Executive Director may continue to receive base salary,

benefits and pension for the duration of their notice period during

which time the Company may require the individual to fulfil their

current role or may place the individual on garden leave. The

Committee will seek to minimise the level of payments to a departing

Director, having regard to all circumstances, including the Company’s

contractual obligations to the Director, the reason for departure, and

the Company’s policy on mitigation.

The Company may elect to make a monthly payment of base salary,

plus an amount in lieu of benefits/pension contribution/equivalent or

just base salary, in lieu of notice. Any payments in lieu of notice would

be phased monthly and subject to offset against earnings elsewhere.

Reasonable outplacement and legal costs may be payable.

Where a Director may be entitled to pursue a claim against the

Company in respect of his/her statutory employment rights or any

other claim arising from the employment or its termination, the

Committee will be entitled to negotiate settlement terms with the

Director that the Committee considers to be reasonable in the

circumstances and is in the best interests of the Company, and to

enter into a settlement agreement with the Director.

In addition to the contractual provisions regarding payment on

termination set out above, the Group’s incentive plans and share

plans contain provisions relating to termination of employment. Good

leaver provisions relate to termination of office or employment by

reason of death, ill-health, injury, incapacity or disability of the award

holder, redundancy or sale or transfer out of the Group or the

Company or undertaking employing that employee, or any other

circumstances stipulated by the Committee at the date of award.

For any good leaver the approach in relation to the incentive plans

will be as follows:

Annual bonus: bonus may be payable at the normal time pro-rata for

the portion of the year worked. Outstanding deferred bonus awards

would be retained and would vest at the usual time.

PSP awards: awards would vest at the usual time subject to the

achievement of the performance conditions and would normally be

scaled back pro-rata for the extent of the vesting period completed at

cessation of employment (unless in exceptional circumstances the

committee determines that the award should not be scaled back).

The two year post vest holding period would usually continue to

apply.

If an Executive Director is not deemed to be a good leaver, all bonus

entitlements and LTIP awards would normally lapse.

Non-Executive Directors’ letters of appointment incorporate a notice

period of three months.

No payment for compensation for loss of office will be made to the

Chair or any Non-Executive Director other than where the Company

determines that fees for the notice period should be paid.

The details of the service contracts for Executive Directors and Letters

of Appointment for the Non-Executive directors are summarised below:

Directors Date of Appointment

Expiry date of service agreement

of letter of appointment

Allan Lockhart 18 August 2016 12 month rolling contracts

Will Hobman 20 August 2021

Margaret Ford 1 September 2017 3 month rolling contracts

Colin Rutherford 5 February 2019

Dr Karen Miller 30 May 2022

Charlie Parker 10 September 2020

Alastair Miller 18 August 2016

The service agreements are available to shareholders to view at the

Company’s Registered Office on request from the Company

Secretary and at the Annual General Meeting.

External directorships and memberships

Executive Directors may take up one external directorship, subject to

the prior approval of the Board. In considering the appointment, the

Board will consider whether the appointment will have an adverse

impact on the Director’s role within the Company and whether it will

be a conflict of interest. Fees earned may be retained by the Director.

At present, no Executive Director has an external directorship.

Executive Directors are encouraged to join, when invited, advisory

committees of industries and professional bodies directly related to

the Company’s business. This helps to keep the Company informed

of any future regulations or trends which may affect it in the future, as

well as providing the opportunity to influence future decision making.

Recruitment arrangements

The Committee will apply the same remuneration policy and

principles when setting the remuneration package for a new

Executive Director. The Committee will take into consideration all

relevant factors to ensure that pay arrangements are in the best

interests of the Company and its shareholders.

Ongoing benefits, pension provisions, annual bonus participation and

awards under both the DBP and the PSP will be in line with those

stated in the policy. In exceptional circumstances, the maximum level

of variable pay which may be awarded to a new Executive Director in

the first year of appointment under the policy will be 325% of salary

(i.e. 125% annual bonus plus 200% PSP award).

Different performance measures may be set for any initial awards

under the DBP and PSP after considering the responsibilities of the

individual, the point in the year that they joined and the rules of the

applicable plan. The rationale will be clearly explained in the Annual

Report following such recruitment. The level of bonus which may be

paid will be pro-rated to reflect the time in the year when the

Executive Director joins.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

The Committee will have discretion to make payments or awards to buy out incentive arrangements forfeited on leaving a previous employer,

i.e. over and above the approach outlined in the table above and may exercise the discretion available under Listing Rule 9.4.2R if necessary to

do so. In doing so, the Committee will match the fair value of the awards forfeited, taking account of the form, any applicable performance

conditions and the likelihood of those conditions being met and the proportion of the applicable vesting period remaining.

Where an Executive Director appointment is an internal candidate, the Committee will honour any pre-existing remuneration obligations or

outstanding variable pay arrangements that relate to the individual’s previous role.

Non-Executive directors will be recruited on the basis of a Letter of Appointment with a three month notice period.

Minimum On Target Maximum Maximum

with

Share Price

Increase

Minimum On Target Maximum Maximum

with

Share Price

Increase

Allan Lockhart Will Hobman

Total remuneration (£)

500k

1,000k

1,500k

2,000k

£350k

100.0%

31.9%

55.4%

30.0%

13.0%

26.1%

32.6%

28.3%

100.0% 54.5% 31.7% 27.6%

32.9%

26.3%

13.2%

38.0%

30.3%

32.5%

13.0%

37.4%

32.6%

12.7%

£526k

£643k

£1,103k

£1,271k

£950k

£1,857k

£1,615k

Illustrations of the operation of the Remuneration Policy

Fixed Pay Annual Bonus LTIP LTIP value with 50%

share price growth

Minimum performance: • comprising the minimum remuneration receivable (being base salary,

pension and benefits received in FY23);

On target performance: • comprising fixed pay, annual bonus payment at 50% of the maximum

opportunity and long-term incentive awards vesting at 25% of

maximumopportunity;

Maximum performance: • comprising fixed pay, 100% of annual bonus and 100% vesting

of long-term incentive awards, and

Maximum performance with share price increase: • comprising fixed pay, 100% of annual bonus and 100% vesting

of long-termincentive awards with the value increased for share price

appreciation of 50%.

127

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Remuneration Committee Report continued

Remuneration Report

This section sets out how the Directors’ Remuneration Policy

wasimplemented during the financial year ended 31 March 2023.

Where stated, disclosures regarding Director’s remuneration have

beenaudited by the Company’s external auditors, PwC. This section,

together with the Chair’s Statement, is subject to an advisory vote at

the2023 AGM.

Remuneration Committee

The Remuneration Committee is comprised of all the Non-Executive

Directors, including the Chair. Karen Miller was appointed to the Board on

30 May 2022 and joined the Committee on this date. The Remuneration

Committee meets at least four times a year, together with adhoc

meetings when required. It met four times during the year. A Board and

Committee attendance chart is contained in the Governance report on

page 106.

FY23 Remuneration Committee activity

May

• Review outcome of Corporate and personal targets

for Exec Director bonuses

• Review and approve ExCo bonuses

• Consider DBS and PSP awards and targets

• FY23 targets and objectives

• Review Remuneration report

▼

September

• Plan and discuss the proposed new Remuneration Policy

• Review Terms of Reference

▼

November

• Consider the Remuneration Policy proposal

• Review the shareholder consultation process

▼

March

• Consider shareholder feedback

• Report from Korn Ferry on developments in market

practice in remuneration

• Review wider workforce arrangements and pay policy

• FY24 targets and objectives

Committee members

Alastair Miller: Committee Chair

Margaret Ford

Colin Rutherford

Charlie Parker

Dr Karen Miller

The Chief Executive Officer and Chief Operating and People Officer

were invited to attend all or part of the meetings as relevant. These

individuals were not present when their own remuneration was

discussed. The Company Secretary acts as secretary to the Committee.

Role of the Remuneration Committee

The role of the Remuneration Committee is to establish a formal and

transparent procedure for developing and implementing the

Remuneration Policy. The Policy should have regard to the risk

appetite of the Company and Executive remuneration should be

aligned to the Company’s purpose and values and be clearly linked

to the successful delivery of the Company’s long-term strategy. The

Committee also reviews the remuneration of the Chair and senior

executives below Board level. Terms of reference for the

Remuneration Committee can be found on the Company’s website.

Other main responsibilities of the Committee are to:

• ensure that the Directors and executive management are provided

with appropriate incentives to encourage enhanced performance

and are, in a fair and responsible manner, rewarded for their

individual contributions to the success of the Company and to align

their interests with those of shareholders;

• attract, retain and motivate Directors and executive management

of the quality required to run the Company successfully without

paying more than is necessary, having regard to views of

shareholders and other stakeholders;

• review and have regard to workforce remuneration and related

policies and the alignment of incentives and rewards with culture,

taking these into account when setting remuneration policy for

Directors and especially when determining annual salary increases;

• consider and set the objectives, annual pay and targets for the

Directors and executive management; and

• review the operation of the Group’s share incentive schemes and

the granting and vesting of the schemes.

Any potential conflicts of interest are managed carefully. No Director

is present when their own remuneration is being discussed and

Committee papers are redacted where appropriate to avoid

individuals seeing proposals before they are discussed by the

Committee. Each meeting minutes whether there are any potential

conflicts for any members or attendees.

Statement of voting at the Annual General Meeting

The following table summarises the details of votes cast for and against the Directors’ remuneration policy and the Directors’ remuneration

report at the 2020 and 2022 AGM, along with the number of votes withheld.

Votes for % Votes against %

Total shares for

and against Votes withheld

That the Directors’ remuneration report be received and

approved (2022 AGM)

130,803,393 91.13 12,735,708 8.87 143,539,101 19,847

That the Directors’ remuneration policy be received and

approved (2020 AGM)

160,581,406 94.19 9,902,752 5.81 170,484,158 89,031

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Remuneration Committee advisor

The Committee keeps itself fully informed on developments and best practice in the field of remuneration and it seeks advice from external

advisers when appropriate. The Committee appoints its own independent remuneration advisers and appointed Korn Ferry in 2018 following a

competitive process. During the year the Committee continued to retain the services of Korn Ferry. Korn Ferry is a member of the Remuneration

Consultants Group and signatory to its Code of Conduct which can be found at www.remunerationconsultantsgroup.com. During FY23 Korn

Ferry did not provide any other services to the Company. Fees charged by Korn Ferry were on a time and materials basis and totalled £47,770

in the year ended 31 March 2023. The Committee reviews the performance and independence of its advisers on an annual basis and is

satisfied that the advice provided is objective and independent.

Total remuneration payable to Directors for FY23 (audited)

The following tables show a single figure total of remuneration for the year ended 31 March 2023 for each of the Directors and compares this

figure to the prior year.

Executive Directors

Financial Year Salary £ Benefits

£ Pension

Subtotal for

fixed pay £ Cash bonus £

Value of bonus

deferred into

shares £

Long-term

incentive

plans £

Subtotal for

variable pay £ Total £

Allan Lockhart 2023 470,000 5,001 70,500 545,501 338,870 145,230 266,056 750,156 1,295,657

2022 470,000 3,337 70,500 543,837 308,438 132,187 – 440,625 984,462

Will Hobman

2023 325,000 2,168 13,000 340,168 234,325 100,425 – 334,750 674,918

2022 189,583 855 7,583 198,021 141,002 60,430 – 201,432 399,453

1. Benefits are the Directors’ private medical cover.

2. Will Hobman was appointed to the Board on 20 August 2021 and the remuneration for FY22 shown is from this date. The value for the bonus has been pro-rated

from appointment, in FY22. No LTIP vesting is shown in respect of Will Hobman as the award predated his appointment as CFO.

3. Allan Lockhart received a pension contribution of 15% of salary. Will Hobman received a pension contribution of 4% of salary.

Non-Executive Directors

Financial Year Base Fee £

Audit Committee

Chairman £

Remuneration Committee

Chairman £

Senior Independent

Non-Executive Director £ Total £

Margaret Ford 2023 160,000 – – – 160,000

2022 160,000 – – – 160,000

Kay Chaldecott

2023 16,667 – – – 16,667

2022 50,000 – – – 50,000

Alastair Miller 2023 50,000 – 7,500 7,500 65,000

2022 50,000 – 7,500 7,500 65,000

Charlie Parker 2023 50,000 – – – 50,000

2022 50,000 – – – 50,000

Colin Rutherford 2023 50,000 7,500 – – 57,500

2022 50,000 7,500 – – 57,500

Dr Karen Miller

2023 42,051 – – – 42,051

2022 – – – – –

1. Kay Chaldecott stepped down from the Board on 26 July 2022.

2. Dr Karen Miller was appointed to the Board on 30 May 2022.

129

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Remuneration Committee Report continued

Annual bonus for the year to 31 March 2023 (audited)

Executive Directors had the opportunity to earn a bonus up to a maximum of 125% of salary on the basis of the achievement of the following measures.

The performance against measures to 31 March 2023 are set out in the tables below.

Weighting Threshold Target Stretch Actual result

Achievement % of maximum

available under that element

Pay-out as a percentage of total

bonus

Measure

25% of

maximum

50% of

maximum

100% of

maximum

Allan

Lockhart

Will

Hobman

Allan

Lockhart

Will

Hobman

Corporate

Total Return vs

IPD All Retail 25% At index 10% ahead 20% ahead Stretch 100% 100% 25% 25%

Earnings yield

(UFFO) 25% <5% below £21.7m

>5% or

above £25.8m 100% 100% 25% 25%

Financial

LTV 10% <38% <36% <34% 33.9% 100% 100% 10% 10%

TAR Return 15% <10% 6.7% >10% Miss 0% 0% 0% 0%

Strategic

objectives 25% See below 90% 90% 22.5% 22.5%

A summary of the strategic objectives are shown below:

Strategic objectives Weighting Assessment of performance by the Committee Achievement

Allan Lockhart Will Hobman Allan Lockhart Will Hobman

Cost reductions: unlock further cost saving 5% A further £900k of savings unlocked 5% 5%

Achieve further disposals from the Workout portfolio 7.5% Disposal of Wakefield and Darlington assets 7.5% 7.5%

Capital Partnerships: secure additional capital partnerships 5%

M&G mandate to manage 16 Retail Parks

and 2 Shopping centres 5% 5%

ESG

Green Financing Structure

GRESB and EPRA Score Maintenance

Measured Reduction in the Journey to Net-Zero 7.5%

Achieved target GRESB and EPRA scores

and progress on Net-Zero see ESG Report

on pages 54-87 5% 5%

Total 25% 90% 90% 22.5% 22.5%

Based on performance to 31 March 2023, the annual bonus outcome for Executive Directors during the year are shown below. The Committee

is satisfied that no adjustments to the pay-outs is required, and that the outcome is reflective of underlying performance.

Executive Annual Bonus outcome

% of maximum % of salary Bonus outcome

Allan Lockhart 82.5% 103% £484,100

Will Hobman 82.5% 103% £334,750

Thirty percent of the bonus will be deferred into shares for two years. Deferred shares are subject to continued employment.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Long-term Incentive Plans (audited)

Vesting of Performance Share Plan awards

Performance Share Plan Awards were granted to Allan Lockhart and Will Hobman on 21 August 2020.

The performance targets for these awards are shown below:

Weighting Threshold Target Stretch Actual result

Vesting

(% of max)

Measure 25% of maximum 75% of maximum 100% of maximum

Total Shareholder Return vs UK REITs

50% Median 62.5 percentile Upper Quartile Below median 0%

Total Accounting Return vs UK REITs

50% Median 62.5 percentile Upper Quartile Below median 100%

Total 50%

1. The UK REIT peer group listed on page 132.

The targets for the Total Accounting Return element were assessed against performance to 31 March 2023. For the TSR element, performance

is assessed for a period of three years to 21 August 2023, three years from the date of grant. Based on the Company’s TSR performance to

31 January 2023, it is estimated that the TSR element will vest in full. The actual TSR and vesting level will be provided in the FY24 Directors’

Remuneration Report

The Committee is comfortable that the formulaic outcome of the LTIP reflects wider business performance and so no discretion has been

applied. The estimated vesting levels for the FY21 LTIP awards are shown below:

Executive Grant date Vest date

Number of shares

granted

Estimated number

of shares to vest

Value of share

to vest

Dividend

equivalents Estimated value

Allan Lockhart 21-Aug-20 21-Aug-23 497,354 248,677 £219,507 52,727 £266,056

Will Hobman 21-Aug-20 21-Aug-23 158,730 79,365 £70,055 16,827 £84,911

• Allan Lockhart’s FY21 award remains subject to a two-year post-vesting holding period. Will Hobman was the Finance Director (below Board

level) when the FY21 awards were granted and so no holding period applies. Will Hobman’s awards are therefore not shown on the single

remuneration table.

• The value of the shares to vest are based on a three-month average share price of 88.27p to 31 March 2023. This value will be restated in

the single figure table next year based on the actual share price on the date of vesting.

• Dividend equivalents include the final dividend declared for FY23 to be paid in August 2023 prior to vesting.

• The share price at grant was 63p, therefore the share price has increased by 25.27p. As a result, the value attributable to share price

appreciation is £76,165 for Allan Lockhart and £24,307 for Will Hobman.

PSP awards granted in the year to 31 March 2023 (audited)

The following Performance Share Plan awards were granted to Executive Directors as nil cost options on 6 July 2022:

Executive

Value of awards at grant date

(% salary)

Number of shares comprising

award

% of award vesting at

threshold Vesting Period End Date Holding Period End Date

Allan Lockhart £470,000 ( 100%) 532,880 25% 6 July 2025 6 July 2027

Will Hobman £325,000 (100%) 368,481 25% 6 July 2025 6 July 2027

1. The closing price on the day before the grant date has been used to determine the number of shares comprising the award. This was 88.2p.

Performance will be assessed from 1 April 2022 to 31 March 2025. The targets for both performance conditions are as follows:

TSR ranking vs. UK REITs (50% of award) Total Accounting Return ranking vs. UK REITs (50% of award) Vesting (% of award)

Below threshold Less than Median (50th percentile) Less than Median (50th percentile) 0

Threshold Equal to Median (50th percentile) Equal to Median (50th percentile) 25

Equal to 62.5th percentile Equal to 62.5th percentile 75

Maximum

Equal to Upper Quartile

(75th percentile) and above

Equal to Upper Quartile

(75th percentile) and above 100

1. Vesting is calculated on a straight-line basis between 25%, 75% and 100%.

2. 50% of each award may vest based on the Company’s TSR compared to a group of UK REITs.

3. 50% of each award may vest based on the Company’s Total Accounting Return (“TAR”) compared to a group of UK REITs that report their NAV on an EPRA basis.

TAR is defined as the annualised return over the performance period based on the change in EPRA NTA per share and the level of dividends paid per share.

131

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Remuneration Committee Report continued

The TSR and TAR comparator group was composed of the companies set out in the list below.

• SEGRO • GREAT PORTLAND ESTATES • UNITE GROUP • LONDONMETRIC PROPERTY

• LAND SECURITIES GROUP • WORKSPACE GROUP • TRITAX BIG BOX REIT • SAFESTORE HOLDINGS

• BRITISH LAND • BIG YELLOW GROUP • GRAINGER • UK COMMERCIAL PROPERTY REIT

• DERWENT LONDON • ASSURA • CLS HOLDINGS • PRIMARY HEALTH PROPERTIES

• HAMMERSON • SHAFTESBURY CAPITAL

Deferred Shares granted in the year to 31 March 2023 (audited)

Awards of Deferred Bonus Shares over the Company’s shares were granted to Executive Directors as nil cost options in FY23 as shown below.

The deferred share awards are based on 30% of the bonus awarded for the year to 31 March 2022. Vesting of the awards is normally subject to

continued employment at the date of vesting in two years’ time.

Executive Number of shares granted

1,2

Face value of the award at grant date Grant date Vest date

Allan Lockhart 148,960 £132,187 6 July 2022 6 July 2024

Will Hobman 109,255 £96,953 6 July 2022 6 July 2024

1. The closing price on the day before the grant date has been used to determine the number of shares comprising the award. This was 88.74p.

2. Awards are not subject to performance conditions.

3. Vesting of awards is normally subject to continued employment unless an employee leaver is deemed a ‘Good Leaver’.

4. Will Hobman was the Finance Director (below Board level) prior to his appointment as CFO. The award of Deferred Bonus Shares is based on his bonus for the

full financial year.

Summary of Directors Interests (audited)

The beneficial interests of the Executive Directors in share awards and share options as at 31 March 2023 are shown in the following tables.

Allan Lockhart

Grant Date Plan Vesting by

Share price at

date of award £

Exercise

price £

At 31 March

2022 Granted

Dividend equivalent

shares added

Lapsed Exercised

At 31 March

2023

May 2018 DBP May 2020 2.86 nil 62,194 – – – – 62,194

Jun 2019 PSP Jun 2022 1.77 nil 314,327 – – (314,327) – –

Jun 2019 DBP Jun 2021 1.79 nil 66,952 – – – – 66,952

Aug 2020 PSP Aug 2023 0.63 nil 537,381 – 44,340 – – 581,721

Sept 2021 DBP Sept 2023 0.78 nil 37,348 – 3,081 – – 40,429

Sept 2021 PSP Sept 2024 0.78 nil 622,480 – 51,362 – – 673,842

July 2022 DBP July 2024 0.88 nil – 148,960 12,290 – – 161,250

July 2022 PSP July 2025 0.88 nil – 532,880 43,968 – – 576,848

Total 1,640,683 681,840 155,041 (314,327) – 2,163,236

Will Hobman

Grant Date Plan Vesting by

Share price at

date of award £

Exercise

price £

At 31 March

2022 Granted

Dividend equivalent

shares added

Lapsed Exercised

At 31 March

2023

Jun 2019 PSP Jun 2022 1.77 nil 70,220 – – (70,220) – –

Aug 2020 DBP Aug 2022 0.63 nil 48,668 – – – (48,668) –

Aug 2020 PSP Aug 2023 0.63 nil 171,504 – 14,151 – – 185,655

Sept 2021 DBP Sept 2023 0.78 nil 21,852 – 1,802 – – 23,654

Sept 2021 PSP Sept 2024 0.78 nil 271,507 – 22,402 – – 293,909

July 2022 DBP July 2024 0.88 nil – 109,255 9,014 – – 118,269

July 2022 PSP July 2025 0.88 nil – 368,481 30,404 – – 398,885

Total 583,752 477,736 77,773 (70,220) (48,668) 1,020,373

1. A holding period of two years is applied following vesting.

2. The right to dividends is accrued and is only payable if and to the extent that the awards vest. The FY23 final dividend declared is not included in this figure.

3. Will’s awards were exercised on 25 November 2022, some of the shares were sold to cover tax at a share price of 71.3p. The aggregate gain from exercising

this award was £34,840.

DBP = Deferred Bonus Plan.

PSP = Performance Share Plan.

132

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Details of the Directors’ shareholdings and rights to shares (audited)

It is the Board’s policy that Executive Directors build up and retain a minimum shareholding of 200% of base salary. Beneficially owned shares,

the net of tax value of vested and unvested DBP awards plus vested but unexercised PSP awards may be counted towards the value of the

executives’ shareholdings for the purposes of the 200% holding guideline.

The beneficial interests of Directors who served during the year, in the shares of the Company are as follows:

Beneficially

owned

shares held

at 31 March

2023

Value of

beneficially

owned shares

as % of salary

Vested DBP

awards heldat

31 March

2023

Vested but

unexercised PSP

awards held at

31 March 2023

Unvested DBP

awards held at

31 March

2023

Value of

holdings

including

vested and

unvested DBP

and PSP

Unvested PSP

awards held at

31 March

2023

Total held as at

31 March 2023

Shareholding %

ofsalary

Allan Lockhart 374,286 63% 129,146 – 201,679 119% 1,832,411 2,537,522 119% (unmet)

Will Hobman 188,517 46% – – 141,923 80% 878,449 1,208,889 80% (unmet)

Margaret Ford 106,440 – – – – 106,440 N/A

Alastair Miller 69,806 – – – – – – 69,806 N/A

Colin Rutherford – – – – – – – – N/A

Charlie Parker 11,454 – – – – – – 11,454 N/A

Dr Karen Miller – – – – – – – – N/A

1. Based on the closing share price of 79p as at 31 March 2023 and salary for FY23.

2. Includes dividend equivalent shares added to that date. Although vested these awards have not yet been exercised.

3. All awards are nil cost awards.

4. Vested but unexercised PSPs are not subject to performance conditions. Unvested PSPs are subject to performance conditions. Outstanding DBP awards are not

subject to performance conditions. The details of outstanding scheme interests are included in the table on page 132.

5. At least half of the net shares vested under the deferred annual bonus and the PSP must be retained until the shareholding requirement is met.

DBP = Deferred Bonus Plan.

PSP = Performance Share Plan.

There have been no changes in the number of shares held from 31 March 2023 to 12 June 2023, being the latest practicable date before the

publication of this Annual Report.

Payments for loss of office and to past Directors (audited)

Kay Chaldecott stepped down from the Board on 26 July 2022 and received fees to that date of £16,677. There were no additional payments.

133

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Remuneration Committee Report continued

Historic Total Shareholder Return performance and Chief Executive Officer remuneration

The following information allows comparison of the Company’s TSR (based on share price growth and dividends reinvested) with the

remuneration of the CEO over the last ten years, together with bonus and LTIP pay-outs (as a percentage of the maximum).

NewRiver

FTSE 350 REIT

FTSE 250

100

150

200

250

FY23FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22

The chart shows the Company’s TSR and that of the FTSE250 and the FTSE350 REIT Indices based on an initial investment of £100 on

1 April 2013 and values at intervening financial year ends over a ten-year period to 31 March 2023. These are considered to be appropriate

benchmarks for the graph as the Company was a constituent of these indices during the financial years shown.

2014 2015 2016 2017 2018 2019 2020

2021 2022 2023

David

Lockhart

David

Lockhart

David

Lockhart

David

Lockhart

David

Lockhart

Allan

Lockhart

Allan

Lockhart

Allan

Lockhart

Allan

Lockhart

Allan

Lockhart

Total remuneration

(£) 642,000 850,000 1,792,205 1,341,958 1,012,946 911,972 543,239 637,339 984,462 1,295,657

Annual bonus

(% of max) 69.0 70.0 100.0 66.7 77.3 64.0 – 20.0 75.0 82.5

Total LTIP vesting

(% of max) – – 50.0 76.3 13.1 – – – – 50.0

1. Allan Lockhart received no bonus in 2020

CEO pay ratio

As the Company has less than 250 employees, we are not required to disclose the CEO pay ratio. We however consider it appropriate to

disclose our pay ratios on a voluntary basis as we are committed to supporting strong governance and transparency. The ratio of the CEO’s pay

to the 25

, 50

and 75

percentile is shown overleaf, along with the total pay for the employees at the three quartiles.

We have based the calculation on the methodology outlined in Option A under the regulations, although, we have chosen not to disclose the

three salary levels for the relevant employees to allow a simpler comparison with the total pay of the CEO. This method is, in the Committee’s

view, the most comprehensive and accurate reflection of the remuneration picture across our employee population.

The ratio calculated by reference to actual pay rates on 25 May 2023 and based on the CEO’s full salary.

The CEO pay ratio is broadly in line with the ratio last year. The Committee has used the ratio as part of the overall review of the policy and is

comfortable that the ratio is a fair reflection of the differences to the level of pay of the CEO compared to the workforce generally.

Year Method 25

percentile pay ratio Median pay ratio 75

percentile pay ratio

FY23 Option A 6.6:1 12.6:1 19.2:1

FY22 Option A 7:1 12.7:1 17.2:1

FY21 Option A 7:1 9:1 19:1

FY20 Option A 8:1 17:1 34:1

The total pay for the individuals identified at the Lower quartile, Median and Upper quartile positions are set out below:

FY23

Total Pay

Upper quartile £196,932

Median £102,551

Lower quartile £67,469

134

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Annual percentage change in remuneration of Directors and employees

The table below sets out the percentage change in base salary, value of taxable benefits and bonus for all the Directors compared with the

average percentage change for employees.

FY22/FY23 FY21/22 FY20/FY21

Directors Salary/fee Benefits Annual Bonus Salary/fee Benefits Annual Bonus Salary/fee Benefits Annual Bonus

Executive Directors

Allan Lockhart 0% 49.9% 9.9% 0% 18% 369% 0% 0% 100%

Will Hobman

0% 32.9% 8.5% N/A N/A N/A N/A N/A N/A

Non-Executive Directors

Margaret Ford 0% N/A N/A 0% N/A N/A 0% N/A N/A

Kay Chaldecott

0% N/A N/A -6% N/A N/A 0% N/A N/A

Alastair Miller 0% N/A N/A 0% N/A N/A 0% N/A N/A

Charlie Parker 0% N/A N/A 0% N/A N/A 0% N/A N/A

Colin Rutherford 0% N/A N/A 6% N/A N/A 0% N/A N/A

Dr Karen Miller

N/A N/A N/A N/A N/A N/A N/A N/A N/A

All Employees

5% 37% 6% 5.15% 20% 96% 0% 0% 100%

1. Will Hobman was appointed to the Board on 20 August 2021 for ease of comparison, we have compared his pay on a pro-rated basis.

2. Kay Chaldecott stepped down from the Board on 26 July 2022 for ease of comparison, we have compared her pay on a pro-rated basis

3. Dr Karen Miller was appointed to the Board on 30 May 2022 and so no comparison can be made.

4. All employees are used as there are no employees of the listed parent company.

Relative importance of spend on pay

The table below shows employee pay and distributions to shareholders for FY23 and FY22.

FY23 £’000 FY22 £’000 % difference from prior year

Total spend on employee pay

6,292 7,614 (17.3%)

Total distributions to shareholders 20,863 21,661 (3.7%)

Share Buy Backs – – 0%

1. Includes salaries, bonuses, social security costs and pension costs as shown in the notes to the Financial Statements.

Implementation of policy in FY24

The section below sets out the implementation of the proposed remuneration policy in FY24 which has been set in line with the remuneration

policy to be put to shareholders at the 2023 AGM. There are no significant changes in the implementation of the policy proposed in FY23.

Salaries and fees

During the year the Committee reviewed the salary increases for the wider workforce taking into account high inflation and the increase in cost

of living. As a result, the wider workforce received an average increase of 5%.

The Committee reviewed the base salary levels for Executive Directors and determined that the salaries should be increased by 3%. The base

salaries for FY24 are set out below:

Executive Salary for FY23 Salary for FY24 % increase

Allan Lockhart – Chief Executive Officer £470,000 £484,100 3%

Will Hobman – Chief Financial Officer £325,000 £334,750 3%

The Committee also reviewed the Chair fees and the Board (minus the Non-Executive Directors) reviewed the Non-Executive Director fees and

concluded that there should be a similar 3% increase to base fees and Committee Chair Fees. The fees for the Chairman and Non-Executive

Directors in FY24 are set out below:

Director Fees for FY23 Fees for FY24 % increase

Chairman £160,000 £164,800 3%

Basic fee for a Non-Executive Director £50,000 £51,500 3%

Additional fee for serving as Chairman of the Audit

and Remuneration Committees £7,500 £7,725 3%

Additional fee for serving as the Senior Independent

Non-Executive Director £7,500 £7,725 3%

• The Non-Executive Directors’ fees were last increased in April 2018

135

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Annual bonus

The annual bonus will operate as laid out in the Remuneration Policy. Executive Directors will have the opportunity to earn a bonus up to a

normal maximum of 125% of salary.

In line with FY23, the bonus will be based on financial and corporate measures (75%) as well as personal strategic objectives (25%). The

performance measures are set out in the table below.

Measure FY24 Weighting

Total Return vs IPD index 25%

Earnings yield (UFFO) 25%

LTV 5%

TAR Return 20%

Strategic objectives (including ESG targets) 25%

The measures have been selected to reflect a range of key financial and operational goals which support the Company’s strategic objectives.

The respective targets have not been disclosed as they are commercially sensitive. However, retrospective disclosure of the targets and

performance against them will be set out in the FY24 Remuneration Report. 30% of the bonus will be deferred into shares for two years.

Long-term incentives – Performance Share Plan

The Committee intends to grant LTIP awards to Executive Directors of 100% of salary. The extent to which the LTIP awards will vest will be

determined by the performance measures listed below.

Measure Weighting

Threshold Target Stretch

25% of maximum 75% of maximum 100% of maximum

Relative TSR vs UK REIT peer group 50% Median 62.5 percentile Upper Quartile

Relative TAR vs UK REIT peer group 50% Median 62.5 percentile Upper Quartile

• The UK REIT peer group listed on page 132.

Awards must be held by Executive Directors for a further two years after vesting.

Signed on behalf of the Board

Alastair Miller

Committee Chair

14 June 2023

Remuneration Committee Report continued

136

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

The Directors present their

report together with the audited

consolidated financial statements

and the report of the auditor for

the year ended 31 March 2023.

Directors’ Report

Principal activities and status

NewRiver REIT plc (the “Company”) is a premium listed REIT on the

London Stock Exchange. The Company is a specialist real estate

investor, asset manager and developer focused solely on the UK

retail sector. Details of the Group’s principal subsidiary undertakings

are set out on pages 184 to 185.

Governance

The Financial Reporting Council published a revised UK Corporate

Governance Code in July 2018 (the Code). Further information on the

Code can be found on the Financial Reporting Council’s website at:

www.frc.org.uk. The Company’s Statement on Governance can be

found on page 96.

Results and dividend

The Directors have proposed a final dividend of 3.2 pence per share.

Together with the interim dividend of 3.5 pence, the total dividend for

FY23 is 6.7 pence. The final dividend is payable on 4 August 2023 to

shareholders on the register as at 16 June 2023. 3.2 pence will be

paid as a PID net of withholding tax where appropriate. The Company

will be offering a scrip dividend alternative. A dividend of 7.4 pence

per share was paid in FY22.

The Board

The Directors, who served throughout the year unless stated

otherwise, are detailed below:

Service in the year 31 March 2023

Margaret Ford Served throughout the year

Allan Lockhart Served throughout the year

Will Hobman Served throughout the year

Kay Chaldecott Resigned 26 July 2022

Alastair Miller Served throughout the year

Karen Miller Appointed 30 May 2022

Charlie Parker Served throughout the year

Colin Rutherford Served throughout the year

Unless stated otherwise these Directors were in office during the year and up

to the date of signing the financial statements. The roles and biographies of the

Directors in office as at the date of this report are set out on pages 98 to 99.

Kerin Williams

Company Secretary

Directors’ Report

137

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Directors’ Report continued

Directors’ indemnification and insurance

The Company’s Articles of Association provide for the Directors and

officers of the Company to be appropriately indemnified, subject to

the provisions of the Companies Act 2006. Qualifying third-party

indemnity provisions (as defined by section 234 of the Companies

Act 2006) were in force during the year ended 31 March 2023 and

remain in force at the date of signing this report. The Company

purchases and maintains insurance for the Directors and officers of

the Company in performing their duties, as permitted by section 233

Companies Act 2006. This insurance has been in place during the

year and remains in place at the date of signing this report.

Articles of Association

The Company’s latest Articles of Association were adopted at the

2021 AGM. The rules governing the appointment and replacement of

Directors are contained in the Company’s Articles of Association.

Changes to the Articles of Association must be approved by

shareholders in accordance with legislation in force from time to time.

A copy of the Company’s Articles of Association can be found on the

Company’s website, www.nrr.co.uk.

Significant interests

The table below shows the interests in shares notified to the

Company in accordance with Chapter 5 of the Disclosure Guidance

and Transparency Rules issued by the Financial Conduct Authority.

As at 31 March 2023 and as at 7 June 2023 (being the latest

practicable date prior to publication of the Annual Report):

As at 31 March 2023

Shareholder Number of shares

% of issued

ShareCapital

Premier Milton 15,803,355 5.07%

M&G Plc 15,404,761 4.99%

IntegraFin Holdings 15,480,100 4.96%

FIL Limited 15,080,808 4.87%

Farringdon Capital Management 11,909,919 3.83%

As at 7 June 2023

Shareholder Number of shares

% of issued

ShareCapital

Premier Milton 15,803,355 5.07%

FIL Holdings 15,770,051 5.06%

M&G Plc 15,404,761 4.99%

IntegraFin Holdings 15,480,100 4.96%

Farringdon Capital Management 11,909,919 3.83%

Internal controls review

Taking into account the principal risks, emerging risks and the ongoing

work of the Audit Committee in monitoring the risk management and

internal control systems on behalf of the Board, the Directors:

• are satisfied that they have carried out a robust assessment of the

principal and emerging risks facing the Group, including those that

would threaten its business model, future performance, solvency

or liquidity; and

• have reviewed the effectiveness of the risk management and

internal control systems and no significant failings were identified.

Additional Information

The Strategic Report is set out on pages 1 to 95 and is incorporated

into the Directors’ Report by reference. Additional information which

is incorporated by reference into this Directors’ Report, including

information required in accordance with the Companies Act 2006

and the Listing Rule 9.8.4R of the UK Financial Conduct Authority’s

Listing Rules, can be located as follows:

Page numbers

s.172 statement Page 21

Staff, culture and

employee involvement

Staff – pages 22 to 23 and 101

Directors’ interests Pages 132 to 133 of the Directors’

Remuneration Report

Stakeholder engagement Strategic report – pages 22 to 27,

Governance report – pages 102 &

107

Environmental policy ESG report – pages 54 to 87

Greenhouse gas

emissions

ESG report – page 63

Future business

developments

Strategic Report – pages 1 to 95

Financial risk

management objectives

and policies

Pages 88 to 95 and pages 175 to 178

Going concern Page 95

Viability statement Page 95

Governance report Pages 96 to 140

Diversity Pages 22, 74 & 112

Listing Rule:

9.8.4R (1)(2) (5-14)(B) Not applicable

9.8.4R (4) Long-term incentive plans - pages 131

to 132

9.8.6R (9) & LR 14.3.33R(1) Page 112

Powers of Directors

Subject to the Company’s Articles of Association, UK legislation and

any directions given by special resolution, the business of the

Company is managed by the Board, which may exercise all the

powers of the Company.

The Board’s role is to provide entrepreneurial leadership of the

Company within a framework of prudent and effective controls which

enables risk to be assessed and managed. It also sets up the Group’s

strategic aims, ensuring that the necessary financial and human

resources are in place for the Group to meet its objectives and review

management performance. The Board also sets the Group’s values,

standards and culture. Further details on the Board’s role can be

found in the Corporate Governance Report on pages 96 to 140.

Directors’ interests

Details of the Directors’ share interests can be found in the

Remuneration Committee Report on pages 132 to 133. All related party

transactions are disclosed in note 27 to the financial statements.

138

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Change of control - significant agreements

The Company was not party to any significant contracts that are

subject to change of control permissions in the event of a change

of control, but other agreements may alter or terminate upon such

an event.

Compensation for loss of office in the event

of a takeover

The Company does not have any agreements with any Executive

Director or employee that would provide compensation for loss of

office or employment resulting from a takeover except that the

Group’s incentive plans and share plans contain provisions relating to

termination of employment. Further information is provided in the

Directors’ Remuneration Policy set out on pages 123 to 125.

Auditor

PricewaterhouseCoopers LLP have indicated their willingness to

continue in office and a resolution seeking to re-appoint

PricewaterhouseCoopers LLP will be proposed at the forthcoming AGM.

Annual General Meeting

The Annual General Meeting will be held on 26 July 2023. At the

meeting, resolutions will be proposed to receive the Annual Report

and financial statements, approve the Directors’ Remuneration

Report, re-elect Directors and appoint as auditor and authorise the

Audit Committee to determine the remuneration of

PricewaterhouseCoopers LLP. In addition, it will be proposed that

expiring authorities to allot shares and to repurchase shares are

extended. An explanation of the resolutions to be put to the

shareholders at the 2023 AGM and the recommendations in relation

to them will be set out in the 2023 AGM Notice.

Political donations

No political donations were made by the Company or its subsidiaries

during the year (2022: Nil).

The Directors’ Report was approved by the Board of Directors on

14 June 2023.

By Order of the Board

Kerin Williams

Company Secretary

14 June 2023

Branches outside the UK

The Company has no branches outside the UK.

Financial instruments

The Group’s exposure to, and management of, capital risk,

market risk and liquidity risk is set out in note 25 to the Group’s

financial statements.

Share capital structure

As at 31 March 2023, the Company’s issued share capital consisted

of 311,908,265 ordinary shares of one penny each. No shares are

held in treasury. 1,466,713 ordinary shares are held in the Employee

Benefit Trust. Therefore, the total number of voting rights in the

Company is 310,441,552. Further details of the share capital, including

changes throughout the year are summarised in note 23 of the

financial statements.

Ordinary shareholders are entitled to receive notice of, and to attend

and speak at, any general meeting of the Company. On a show of

hands, every shareholder present in person or by proxy (or being a

corporation represented by a duly authorised representative) shall have

one vote, and on a poll every shareholder who is present in person or

by proxy shall have one vote for every share of which he or she is the

holder. The Notice of Annual General Meeting specifies deadlines for

exercising voting rights and appointing a proxy or proxies.

There are no restrictions on the transfer of shares except the UK Real

Estate Investment Trust restrictions. The Directors are not aware of

any agreements between holders of the Company’s shares that may

result in the restriction of the transfer of securities or on voting rights.

Authority for the Company to purchase

its own shares

Subject to authorisation by shareholder resolution, the Company may

purchase its own shares in accordance with the Companies Act

2006. Any shares which have been bought back may be held as

treasury shares or cancelled immediately upon completion of the

purchase. At the Annual General Meeting held in 2022, shareholders

authorised the Company to make purchases (within the meaning of

section 693 of the Companies Act 2006) of the Company’s ordinary

shares, up to a maximum of 10% of the issued share capital at that

time, as well as the allotment of new shares within certain limits

approved by shareholders. The Company has not repurchased any of

its ordinary shares under this authority, which is due to expire at the

AGM in 2023 and appropriate renewals will be sought.

There are no securities of the Company carrying special rights with

regards to the control of the Company in issue.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Statement of Directors’ responsibilities

in respect of the financial statements

The Directors are responsible for preparing the Annual Report and

Accounts and the financial statements in accordance with applicable

law and regulation.

Company law requires the Directors to prepare financial statements

for each financial year. Under that law the Directors have prepared the

Group financial statements in accordance with UK-adopted international

accounting standards and the Company financial statements in

accordance with United Kingdom Generally Accepted Accounting

Practice (United Kingdom Accounting Standards, comprising FRS 101

“Reduced Disclosure Framework”, and applicable law).

Under company law, Directors must not approve the financial

statements unless they are satisfied that they give a true and fair

view of the state of affairs of the Group and Company and of the

profit or loss of the Group for that period. In preparing the financial

statements, the Directors are required to:

• select suitable accounting policies and then apply

them consistently;

• state whether applicable UK-adopted international

accounting standards have been followed for the Group financial

statements and United Kingdom Accounting Standards comprising

FRS 101 have been followed for the Company financial statements,

subject to any material departures disclosed and explained in the

financial statements;

• make judgements and accounting estimates that are reasonable

and prudent; and

• prepare the financial statements on the going concern basis unless

it is inappropriate to presume that the Group and Company will

continue in business.

The Directors are responsible for safeguarding the assets of the

Group and Company and hence for taking reasonable steps for the

prevention and detection of fraud and other irregularities.

The Directors are also responsible for keeping adequate accounting

records that are sufficient to show and explain the Group’s and

Company’s transactions and disclose with reasonable accuracy at

any time the financial position of the Group and Company and enable

them to ensure that the financial statements and the Directors’

Remuneration Report comply with the Companies Act 2006.

The Directors are responsible for the maintenance and integrity of

the Company’s website. Legislation in the United Kingdom governing

the preparation and dissemination of financial statements may differ

from legislation in other jurisdictions.

Directors’ confirmations

Each of the Directors, whose names and functions are listed in the

Governance Report confirm that, to the best of their knowledge:

• the Group financial statements, which have been prepared in

accordance with UK-adopted international accounting standards,

give a true and fair view of the assets, liabilities, financial position

and profit of the Group;

• the Company financial statements, which have been prepared in

accordance with United Kingdom Accounting Standards,

comprising FRS 101, give a true and fair view of the assets, liabilities

and financial position of the Company; and

• the Strategic Report includes a fair review of the development and

performance of the business and the position of the Group and

Company, together with a description of the principal risks and

uncertainties that it faces.

In the case of each Director in office at the date the Directors’ report

is approved:

• so far as the Director is aware, there is no relevant audit

information of which the Group’s and Company’s auditors are

unaware; and

• they have taken all the steps that they ought to have taken as a

Director in order to make themselves aware of any relevant audit

information and to establish that the Group’s and Company’s

auditors are aware of that information.

The confirmation is given and should be interpreted in accordance

with the provisions of section 418 of the Companies Act 2006.

Baroness Ford OBE

Non-Executive Chair

14 June 2023

Directors’ Report continued

140

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Governance

Independent auditors’ report to the

members of NewRiver REIT plc

Report on the audit of the

financialstatements

Opinion

In our opinion:

• NewRiver REIT plc’s Group financial statements and Company

financial statements (the “financial statements”) give a true and fair

view of the state of the Group’s and of the Company’s affairs as at

31 March 2023 and of the Group’s loss and the Group’s cash flows

for the year then ended;

• the Group financial statements have been properly prepared in

accordance with UK-adopted international accounting standards

asapplied in accordance with the provisions of the Companies

Act2006;

• the Company financial statements have been properly prepared in

accordance with United Kingdom Generally Accepted Accounting

Practice (United Kingdom Accounting Standards, including FRS 101

“Reduced Disclosure Framework”, and applicable law); and

• the financial statements have been prepared in accordance with

the requirements of the Companies Act 2006.

We have audited the financial statements, included within the Annual

Report and Accounts (the “Annual Report”), which comprise: the

Consolidated and Company Balance Sheets as at 31 March 2023; the

Consolidated Statement of Comprehensive Income, the Consolidated

Cash Flow Statement and the Consolidated and Company Statements

of Changes in Equity for the year then ended; and the notes to the

financial statements, which include a description of the significant

accounting policies.

Our opinion is consistent with our reporting to the Audit Committee.

Basis for opinion

We conducted our audit in accordance with International Standards

on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities

under ISAs (UK) are further described in the Auditors’ responsibilities

for the audit of the financial statements section of our report. We

believe that the audit evidence we have obtained is sufficient and

appropriate to provide a basis for our opinion.

Independence

We remained independent of the Group in accordance with the

ethical requirements that are relevant to our audit of the financial

statements in the UK, which includes the FRC’s Ethical Standard, as

applicable to listed public interest entities, and we have fulfilled our

other ethical responsibilities in accordance with these requirements.

To the best of our knowledge and belief, we declare that non-audit

services prohibited by the FRC’s Ethical Standard were not provided.

Other than those disclosed in Note 6, we have provided no non-audit

services to the Company or its controlled undertakings in the period

under audit.

Our audit approach

Overview

Audit scope

• We tailored the scope of our audit to ensure that we performed

enough work to be able to give an opinion on the Group financial

statements as a whole and the Company stand alone financial

statements, taking into account the structure of the Group, the

accounting processes and controls and the industry in which the

Group operates.

Key audit matters

• Valuation of investment properties (Group)

• Valuation of investments in subsidiaries (Company)

Materiality

• Overall Group materiality: £7.8 million (2022: £8.2 million) based on

1% of the Group’s total assets.

• Specific Group materiality: £1.2 million (2022: £1.3 million), based on

5% of EPRA earnings.

• Overall Company materiality: £8.1 million (2022: £8.0 million) based

on 1% of the Company’s total assets.

• Overall Group performance materiality: £5.8 million

(2022: £6.1 million), Specific Group performance materiality

£0.9 million (2022: £1.0 million) and Company performance

materiality £6.1 million (2022: £6.0 million).

The scope of our audit

As part of designing our audit, we determined materiality and

assessed the risks of material misstatement in the financial statements.

Key audit matters

Key audit matters are those matters that, in the auditors’ professional

judgement, were of most significance in the audit of the financial

statements of the current period and include the most significant

assessed risks of material misstatement (whether or not due to fraud)

identified by the auditors, including those which had the greatest

effect on: the overall audit strategy; the allocation of resources in the

audit; and directing the efforts of the engagement team. These

matters, and any comments we make on the results of our procedures

thereon, were addressed in the context of our audit of the financial

statements as a whole, and in forming our opinion thereon, and we do

not provide a separate opinion on these matters.

This is not a complete list of all risks identified by our audit.

The Sale of the Hawthorn Pub business (Group), which was a key

audit matter last year, is no longer included because of the one-off

nature of the transaction in the prior year. Otherwise, the key audit

matters below are consistent with last year.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Key audit matter How our audit addressed the key audit matter

Valuation of investment properties (Group)

Refer to page 115 (Audit Committee

report), pages 153-179 (Notes to the

financial statements – Note 1 (Accounting

policies), Note 2 (Critical accounting

judgements and estimates) and Note 14

(Investment properties).

The Group currently owns and manages

a portfolio of commercial property assets

within the UK which includes shopping

centres, retail parks and high street

properties. The total value of the portfolio

as at 31 March 2023 was £593.6 million

(investment properties £551.5 million

and£42.1 million held on a proportionally

consolidated basis within associates and

joint ventures) (2022: £649.4 million).

This was identified as a key audit matter

given the valuation of the portfolio is

inherently subjective and complex due

to, among other factors, the individual

nature of each property, its location,

and the expected future rental streams

for that particular property, together

with considerations around the impact

of climate change. The wider challenges

facing the retail real estate market,

including changing consumer habits

and the impact of macroeconomic

factors, further contributed to the

subjectivity for the year ended 31 March

2023. The valuations were carried out

by external valuers (Colliers, Knight

Frank and Kroll - formerly Duff & Phelps)

in accordance with RICS Valuation -

Professional Standards and the Group

accounting policies which incorporate

the requirements of International

Accounting Standard 40 ‘Investment

Property’.

In determining the valuation of

management’s portfolio, the valuers

consider property specific information

such as the current tenancy agreements

and rental income. They then apply

judgemental assumptions such as

estimated rental value (‘ERV’) and

yield, which are influenced by prevailing

market yields and, where appropriate,

comparable market transactions to

arrive at the final valuation. Due to

the unique nature of each property, the

judgemental assumptions to be applied

are determined having regard to the

individual property characteristics at

a detailed tenant by tenant level, as

well as considering the qualities of

the property.

Given the inherent subjectivity in the valuation of investment properties, the need for deep market

knowledge when determining the most appropriate assumptions and the technicalities of the

valuation methodology, we engaged our internal valuation experts (qualified chartered surveyors)

to assist us in our audit of this matter.

Assessing the valuers’ expertise and objectivity

We assessed the external valuers’ qualifications and expertise and read their terms of engagement

with the Group to determine whether there were any matters that might have affected their

objectivity, such as the length of their relationship with the Group, or that may have imposed scope

limitations on their work. We also considered fee arrangements between the external valuers and

the Group, and other engagements which might exist between the Group and the valuers. We

found no evidence to suggest that the objectivity of the external valuers in their performance of

the valuations was compromised.

Data provided to the valuers

We checked the accuracy of the underlying lease data and capital expenditure used by the external

valuers in their valuation of the portfolio by tracing the data back to the signed lease agreements on

a sample basis. We found the data provided by management to the valuers to be appropriate for the

purposes of the valuation.

Assumptions and estimates used by the valuers

We read the external valuation reports for the investment properties and confirmed that the

valuation approach for each was in accordance with RICS standards and suitable for use in

determining the final value for the purpose of the financial statements. We met with the external

valuers to discuss and challenge the valuation process, the key assumptions, any special

assumptions and the rationale behind the more significant valuation movements during the year. It

was evident from our interaction with the external valuers and from our review of the valuation

reports, that close attention had been paid to the individual characteristics of each property, such as

the overall quality of the tenant base, latest leasing activity and geographic location, depending on

the type of asset being valued. We also challenged the external valuers on the extent to which

recent market transactions were considered in addition to whether the expected rental values took

into account the potential impact of climate change and related ESG considerations. In addition, we

performed the procedures described below for each type of property.

We obtained details of each property and set an expected range for yield and capital value

movement, determined by reference to published benchmarks and using our experience and

knowledge of the market. We compared the yield and capital value movement of each property with

our expected range. We also considered the reasonableness of other assumptions that are not so

readily comparable with published benchmarks, such as ERV. When assumptions were outside of

the expected range, we undertook further investigations and, when necessary, obtained

corroborating evidence to support the explanations received. This enabled us to assess the

property specific factors that had an impact on the value and conclude on the reasonableness of the

assumptions utilised such as:

• location (community shopping centres and conveniently located retail parks);

• size;

• occupancy rates;

• marketability; and

• recent comparable transactions where appropriate.

Overall findings

We found that the assumptions were applied appropriately, reflected comparable market

transactions (where available and appropriate) and included consideration of the impact of climate

change and a range of other external factors. Where assumptions did not fall within our expected

range, we were satisfied that the variances were due to property specific factors as noted above.

While we are satisfied with the rationale and assumptions supporting the individual asset valuations,

we do note that the overall portfolio movement relative to MSCI, alongside losses on current year

disposals looks favourable when compared to published benchmarks but reflects the nature of the

type of retail and tenancy that the properties provide. We consider the valuations to be in line with

the RICS Red Book requirements and suitable for inclusion in the financial statements, and

disclosures in line with the applicable accounting standard. We also considered and satisfied

ourselves as to the reasons why the market capitalisation of the Company was lower than the net

asset value of the Group at the balance sheet date given the different valuation bases.

Auditors Report continued

142

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

Key audit matter How our audit addressed the key audit matter

Valuation of investments in subsidiaries (Company)

Refer to pages 182-186 (Notes to the

financial statements – Note A

(Accounting policies) and Note B

(Investments in subsidiaries)).

The Company holds investments in

subsidiaries amounting to 323.9 million as

at 31 March 2023 (2022: £329.9 million).

The Company’s accounting policy is to

hold its investments in subsidiary

undertakings at cost less provision for

cumulative impairment. The Company has

recognised an impairment of £6.0 million

this year (2022: impairment reversal of

£9.4 million). This is driven by negative

movements in the investment property

valuations held by subsidiaries. Refer to

the key audit matter over Valuation of

investment properties (Group).

Given the material size of the

investments, the investment

impairment and the level of estimation

involved, we considered this to be a

key audit matter for the Company.

We obtained the Company’s assessment of the valuation of investments held in subsidiaries as at

31 March 2023 and performed the following:

• assessed the accounting policy for investments in subsidiaries and verified that the methodology

used by the Directors in arriving at the valuation of each subsidiary was compliant with FRS 101

“Reduced Disclosure Framework”;

• identified the key judgement within the valuation of investments in subsidiaries to be the valuation

of investment properties. For details on our work on property valuations, refer to the key audit

matter above;

• verified that the carrying values of investment properties had been appropriately included in the

assessment of the valuation of investments in subsidiaries; and

• reviewed the disclosures within the Annual Report, including the £6.0 million impairment, and

considered these to be complete and accurate.

Based on the work performed, we concur with the amount of impairment arising. We evaluated the

disclosures in the financial statements and found these to be appropriate.

How we tailored the audit scope

We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements as

a whole, taking into account the structure of the Group and the Company, the accounting processes and controls, and the industry in which

they operate.

The Group currently owns and invests in a number of shopping centres, retail parks, high street shops and developments across the United

Kingdom. These are held within a variety of subsidiaries, joint ventures and associates. We have identified a single component, being the Retail

business, that makes up the Group. The Retail component was subject to a full scope audit using our adopted materiality thresholds and all of

the work was performed by the Group team. These procedures, together with additional procedures performed at the Group level (including

audit procedures over the consolidation and consolidation adjustments), gave us the evidence we needed for our opinion on the Group

financial statements as a whole. In respect of the audit of the Company, the Group audit team performed a full scope statutory audit.

The impact of climate risk on our audit

As part of our audit we also made enquiries of management and its valuation experts to understand the process they have adopted to assess

the potential impact of climate change on the business. Management considers that climate change does not give rise to a material financial

statement impact in the current year. We used our knowledge of the Group to evaluate management’s assessment and we particularly

considered how climate change risks could impact the assumptions made in the valuation of investment property. We also considered the

consistency of the climate change disclosures included in the Annual Report, drawing on our knowledge of the business gained through the

audit process.

Materiality

The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together

with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures on the

individual financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the

financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Financial statements - Group Financial statements - Company

Overall materiality

£7.8 million (2022: £8.2 million). £8.1 million (2022: £8.0 million).

How we determined it

1% of the Group's total assets 1% of the Company's total assets

Rationale for benchmark applied

We determined materiality based on total

assets given the valuation of investment

properties, whether held directly or through

joint ventures and associates, is the key

determinant of the Group's value. This

materiality was used in the audit of investing

and financing activities.

Given the NewRiver REIT plc entity is primarily

a holding Company we determined total

assets to be the appropriate benchmark.

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NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Specific materiality

£1.2 million (2022: £1.3 million) Not applicable

How we determined it

5% of the Group's 2023 EPRA

earnings (2022: 5% of the Group's

2022 EPRA earnings)

Not applicable

Rationale for benchmark applied

In arriving at this materiality, we had regard to

the fact that EPRA earnings are a secondary

financial indicator of the Group (refer to page

164 of the financial statements which includes

a reconciliation between IFRS and EPRA

earnings). This materiality was used in the

audit of operating activities.

Not applicable

We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected

misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope of our audit and the

nature and extent of our testing of account balances, classes of transactions and disclosures, for example in determining sample sizes.

Our performance materiality for investing and financing activities was 75% (2022: 75%) of overall materiality, amounting to £5.8 million

(2022: £6.1 million) for the Group financial statements and £6.1 million (2022: £6.0 million) for the Company financial statements. Our

performance materiality for operating activities was 75% of specific materiality, amounting to £0.9 million (2022: £1.0 million) for the

Group financial statements.

In determining the performance materiality, we considered a number of factors - the history of misstatements, risk assessment and

aggregation risk and the effectiveness of controls - and concluded that an amount at the upper end of our normal range was appropriate.

We agreed with the Audit Committee that we would report to them misstatements identified during our audit above £0.3 million

(Group audit) (2022: £0.4 million) for investing and financing activities, £0.1 million (Group audit) (2022: £0.1 million) for operating activities

and £0.8 million (Company audit) (2022: £0.8 million) as well as misstatements below those amounts that, in our view, warranted reporting

for qualitative reasons.

Auditors Report continued

144

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

Conclusions relating to going concern

Our evaluation of the Directors’ assessment of the Group’s and the

Company’s ability to continue to adopt the going concern basis of

accounting included:

• obtaining management’s paper that supports the Board’s

assessment and conclusions with respect to the disclosures

provided over going concern;

• confirming the Group’s revolving credit facility, Corporate bond and

long-term credit rating and understanding the covenant thresholds;

• discussing the key assumptions supporting the base case going

concern review and forecasts, challenging the rationale for those

assumptions, using our knowledge of the business and industry to

ensure they reflect the latest expectations of the retail market and

industry data;

• reviewing management’s reasonable worst case scenario and

performing our own sensitivity analysis on the forecasts and key

assumptions to understand the potential impact on the financial

covenants, focusing specifically on the Loan to Value (LTV)

covenant, and liquidity headroom;

• reperforming a stress test on the reasonable worst case scenario

by assessing the total fall in investment property required in order

to breach banking covenants;

• checking the mathematical accuracy of management’s model; and

• assessing management’s forecasting accuracy by comparing the

forecasts established to the actual performance for the past 3 years

up to and including 2023.

Based on the work we have performed, we have not identified any

material uncertainties relating to events or conditions that, individually

or collectively, may cast significant doubt on the Group’s and the

Company’s ability to continue as a going concern for a period of at

least twelve months from when the financial statements are

authorised for issue.

In auditing the financial statements, we have concluded that the

Directors’ use of the going concern basis of accounting in the

preparation of the financial statements is appropriate.

However, because not all future events or conditions can be

predicted, this conclusion is not a guarantee as to the Group’s and

the Company’s ability to continue as a going concern.

In relation to the Directors’ reporting on how they have applied the

UK Corporate Governance Code, we have nothing material to add or

draw attention to in relation to the Directors’ statement in the financial

statements about whether the Directors considered it appropriate to

adopt the going concern basis of accounting.

Our responsibilities and the responsibilities of the Directors with

respect to going concern are described in the relevant sections

ofthisreport.

Reporting on other information

The other information comprises all of the information in the Annual

Report other than the financial statements and our auditors’ report

thereon. The Directors are responsible for the other information. Our

opinion on the financial statements does not cover the other

information and, accordingly, we do not express an audit opinion or,

except to the extent otherwise explicitly stated in this report, any form

of assurance thereon.

In connection with our audit of the financial statements, our

responsibility is to read the other information and, in doing so,

consider whether the other information is materially inconsistent with

the financial statements or our knowledge obtained in the audit, or

otherwise appears to be materially misstated. If we identify an

apparent material inconsistency or material misstatement, we are

required to perform procedures to conclude whether there is a

material misstatement of the financial statements or a material

misstatement of the other information. If, based on the work we have

performed, we conclude that there is a material misstatement of this

other information, we are required to report that fact. We have

nothing to report based on these responsibilities.

With respect to the Strategic Report and Directors’ Report, we also

considered whether the disclosures required by the UK Companies

Act 2006 have been included.

Based on our work undertaken in the course of the audit, the

Companies Act 2006 requires us also to report certain opinions and

matters as described below.

Strategic Report and Directors’ Report

In our opinion, based on the work undertaken in the course of the

audit, the information given in the Strategic Report and Directors’

Report for the year ended 31 March 2023 is consistent with the

financial statements and has been prepared in accordance with

applicable legal requirements.

In light of the knowledge and understanding of the Group and

Company and their environment obtained in the course of the audit,

we did not identify any material misstatements in the Strategic Report

and Directors’ Report.

Directors’ Remuneration

In our opinion, the part of the Remuneration Committee Report to be

audited has been properly prepared in accordance with the

Companies Act 2006.

145

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Corporate governance statement

The Listing Rules require us to review the Directors’ statements in

relation to going concern, longer-term viability and that part of the

corporate governance statement relating to the Company’s

compliance with the provisions of the UK Corporate Governance

Code specified for our review. Our additional responsibilities with

respect to the corporate governance statement as other information

are described in the Reporting on other information section of this

report.

Based on the work undertaken as part of our audit, we have

concluded that each of the following elements of the corporate

governance statement is materially consistent with the financial

statements and our knowledge obtained during the audit, and we

have nothing material to add or draw attention to in relation to:

• The Directors’ confirmation that they have carried out a robust

assessment of the emerging and principal risks;

• The disclosures in the Annual Report that describe those principal

risks, what procedures are in place to identify emerging risks and

an explanation of how these are being managed or mitigated;

• The Directors’ statement in the financial statements about whether

they considered it appropriate to adopt the going concern basis of

accounting in preparing them, and their identification of any

material uncertainties to the Group’s and Company’s ability to

continue to do so over a period of at least twelve months from the

date of approval of the financial statements;

• The Directors’ explanation as to their assessment of the Group’s

and Company’s prospects, the period this assessment covers and

why the period is appropriate; and

• The Directors’ statement as to whether they have a reasonable

expectation that the Company will be able to continue in operation

and meet its liabilities as they fall due over the period of its

assessment, including any related disclosures drawing attention to

any necessary qualifications or assumptions.

Our review of the Directors’ statement regarding the longer-term

viability of the Group and Company was substantially less in scope

than an audit and only consisted of making inquiries and considering

the Directors’ process supporting their statement; checking that the

statement is in alignment with the relevant provisions of the UK

Corporate Governance Code; and considering whether the statement

is consistent with the financial statements and our knowledge and

understanding of the Group and Company and their environment

obtained in the course of the audit.

In addition, based on the work undertaken as part of our audit, we

have concluded that each of the following elements of the corporate

governance statement is materially consistent with the financial

statements and our knowledge obtained during the audit:

• The Directors’ statement that they consider the Annual Report,

taken as a whole, is fair, balanced and understandable, and

provides the information necessary for the members to assess the

Group’s and Company’s position, performance, business model

and strategy;

• The section of the Annual Report that describes the review of

effectiveness of risk management and internal control systems; and

• The section of the Annual Report describing the work of the Audit

Committee.

We have nothing to report in respect of our responsibility to report

when the Directors’ statement relating to the Company’s compliance

with the Code does not properly disclose a departure from a relevant

provision of the Code specified under the Listing Rules for review by

the auditors.

Responsibilities for the financial statements

and the audit

Responsibilities of the Directors for the financialstatements

As explained more fully in the Statement of Director’s responsibilities

in respect of the financial statements, the Directors are responsible

for the preparation of the financial statements in accordance with the

applicable framework and for being satisfied that they give a true and

fair view. The Directors are also responsible for such internal control

as they determine is necessary to enable the preparation of financial

statements that are free from material misstatement, whether due to

fraud or error.

In preparing the financial statements, the Directors are responsible for

assessing the Group’s and the Company’s ability to continue as a

going concern, disclosing, as applicable, matters related to going

concern and using the going concern basis of accounting unless the

Directors either intend to liquidate the Group or the Company or to

cease operations, or have no realistic alternative but to do so.

Auditors’ responsibilities for the audit of the

financialstatements

Our objectives are to obtain reasonable assurance about whether the

financial statements as a whole are free from material misstatement,

whether due to fraud or error, and to issue an auditors’ report that

includes our opinion. Reasonable assurance is a high level of

assurance, but is not a guarantee that an audit conducted in

accordance with ISAs (UK) will always detect a material misstatement

when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate, they could

reasonably be expected to influence the economic decisions of users

taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with

laws and regulations. We design procedures in line with our

responsibilities, outlined above, to detect material misstatements in

respect of irregularities, including fraud. The extent to which our

procedures are capable of detecting irregularities, including fraud, is

detailed below.

Based on our understanding of the Group and industry, we identified

that the principal risks of non-compliance with laws and regulations

related to listing requirements including the UK FCA Listing Rules, and

we considered the extent to which non-compliance might have a

material effect on the financial statements. We also considered those

laws and regulations that have a direct impact on the financial

statements such as the Companies Act 2006 and section 1158 of the

Corporation Tax Act 2010, Real Estate Investment Trust (REIT) status.

We evaluated management’s incentives and opportunities for

fraudulent manipulation of the financial statements (including the risk

of override of controls), and determined that the principal risks were

related to posting inappropriate journal entries to increase revenue or

reduce expenditure, and management bias in accounting estimates

and judgemental areas of the financial statements such as the

valuation of investment properties. Audit procedures performed by

the engagement team included:

• discussions with management, including the Company Secretary,

over their consideration of known or suspected instances of

non-compliance with laws and regulation and fraud;

• understanding and evaluating management’s controls designed to

prevent and detect irregularities;

• assessing matters reported on the Group’s whistleblowing helpline

and the results of management’s investigation of such matters,

where relevant;

Auditors Report continued

146

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

• evaluating compliance with the REIT tax rules with the involvement

of our tax specialists in the audit;

• performing procedures relating to the valuation of investment

properties described in the related key audit matter above;

• reviewing relevant meeting minutes, including those of the Board

of Directors and the Audit Committee; and

• identifying and testing journal entries, in particular any journal

entries posted with unusual account combinations or those posted

by senior management.

There are inherent limitations in the audit procedures described

above. We are less likely to become aware of instances of non-

compliance with laws and regulations that are not closely related to

events and transactions reflected in the financial statements. Also, the

risk of not detecting a material misstatement due to fraud is higher

than the risk of not detecting one resulting from error, as fraud may

involve deliberate concealment by, for example, forgery or intentional

misrepresentations, or through collusion.

Our audit testing might include testing complete populations of

certain transactions and balances, possibly using data auditing

techniques. However, it typically involves selecting a limited number

of items for testing, rather than testing complete populations. We will

often seek to target particular items for testing based on their size or

risk characteristics. In other cases, we will use audit sampling to

enable us to draw a conclusion about the population from which the

sample is selected.

A further description of our responsibilities for the audit of the

financial statements is located on the FRC’s website at: www.frc.org.

uk/auditorsresponsibilities. This description forms part of our auditors’

report.

Use of this report

This report, including the opinions, has been prepared for and only for

the Company’s members as a body in accordance with Chapter 3 of

Part 16 of the Companies Act 2006 and for no other purpose. We do

not, in giving these opinions, accept or assume responsibility for any

other purpose or to any other person to whom this report is shown or

into whose hands it may come save where expressly agreed by our

prior consent in writing.

147

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Other required reporting

Companies Act 2006 exceptionreporting

Under the Companies Act 2006 we are required to report to you if,

inour opinion:

• we have not obtained all the information and explanations we

require for our audit; or

• adequate accounting records have not been kept by the Company,

or returns adequate for our audit have not been received from

branches not visited by us; or

• certain disclosures of Directors’ remuneration specified by law are

not made; or

• the Company financial statements and the part of the Remuneration

Committee Report to be audited are not in agreement with the

accounting records and returns.

We have no exceptions to report arising from this responsibility.

Appointment

Following the recommendation of the Audit Committee, we were

appointed by the members on 4 July 2019 to audit the financial

statements for the year ended 31 March 2020 and subsequent

financial periods. The period of total uninterrupted engagement

isfour years, covering the years ended 31 March 2020 to

31 March2023.

Other matter

In due course, as required by the Financial Conduct Authority

Disclosure Guidance and Transparency Rule 4.1.14R, these financial

statements will form part of the ESEF-prepared annual financial report

filed on the National Storage Mechanism of the Financial Conduct

Authority in accordance with the ESEF Regulatory Technical Standard

(‘ESEF RTS’). This auditors’ report provides no assurance over

whether the annual financial report will be prepared using the single

electronic format specified in the ESEF RTS.

Christopher Burns (Senior Statutory Auditor)

for and on behalf of PricewaterhouseCoopers LLP

Chartered Accountants and Statutory Auditors

London

14 June 2023

148

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

For the year ended 31 March 2023

Year ended 31 March 2023 Year ended 31 March 2022

Continuing Operations

Notes

Operating

and financing

2023

£m

Fair value

adjustments

2023

£m

Total

2023

£m

Operating

and financing

2022

£m

Fair value

adjustments

2022

£m

Total

2022

£m

Revenue

4 72.2 – 72.2 73.7 – 73.7

Property operating expenses

* 5 (25.1)

– (25.1)

(25.5)

– (25.5)

Net property income

47.1 – 47.1 48.2 – 48.2

Administrative expenses

6 (12.6)

– (12.6)

(13.4)

– (13 .4)

Other income

7 1.4 – 1.4 – – –

Share of profit from joint ventures

15 2.4 0 .6 3.0 1.1 2.9 4.0

Share of profit from associates

16 0.1 0 .2 0.3 0.2 2.9 3 .1

Net property valuation movement

14 – (38.2)

(38.2)

– (12.3)

(12.3)

Loss on disposal of investment properties

9 (3.8)

– (3.8)

(4.2)

– (4.2)

Operating

(loss) / profit 34.6 (37.4)

(2.8)

31.9 (6.5)

25.4

Finance income

10 1.4 – 1.4 1.4 – 1.4

Finance costs

10 (15.4)

– (15.4)

(19.8)

– (19.8)

(Loss) / profit for the year before taxation

20.6 (37.4)

(16.8)

13.5 (6.5)

7.0

Taxation

11 – – – – – –

(Loss) / profit for the year after taxation from

continuing operations

20.6 (37.4)

(16.8)

13.5 (6.5)

7.0

Loss for the year after taxation from discontinued

operations

8 – – – (3 1.7)

(1.9)

(33.6)

Loss for the year

20.6 (37.4)

(16.8)

(18.2)

(8.4)

(26.6)

Total comprehensive loss for the year

(16. 8)

(26.6)

There are no items of other comprehensive income for the current or prior year

oss) / earnings per share – continuing operations

Basic (pence)

12 (5.4)

2.3

Diluted (pence)

12 (5.4)

2.3

Loss per share

Basic (pence)

12 (5.4)

(8.6)

Diluted (pence)

12 (5.4)

(8.6)

* Included in property operating expenses is a loss allowance reversal of £0.1 million (2022: £0. 3 million) of expected credit loss relating to debtors for continuing

operations.

The notes on pages 153 to 179 form an integral part of these financial statements.

149

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

As at 31 March 2023

Notes

2023

£m

2022

£m

Non

-current assets

Investment properties

14 627.3 684.6

Right of use asset

22 0.9 0.2

Investments in joint ventures

15 23.8 24.0

Investments in

associates 16 5.5 7.9

Property, plant and equipment

0.4 0.7

Total non

-current assets 657.9 717.4

Current assets

Trade and other receivables

17 15.0 18.9

Cash and cash equivalents

19 108.6 82.8

Total current assets

123.6 101.7

Total

assets 7 81.5 819.1

Equity and liabilities

Current liabilities

Trade and other payables

20 29.5 33.5

Lease liability

22 0.4 0.7

Total current liabilities

29.9 34.2

Non

-current liabilities

Lease liability

22 76.3 75.0

Borrowings

21 296.7 295.8

Total non

-current liabilities 373.0 370.8

Net assets

378.6 414.1

Equity

Share capital

3.1 3.1

Share premium

2.4 1.1

Merger reserve

(2.3)

Retained earnings and other reserves

375.4 412.2

Total equity

378.6 414.1

Net Asset Value (N

AV) per share (pence)

Basic

12 122p 135p

Diluted

12 121p 134p

EPRA NTA

12 121p 134p

The notes on pages 153 to 179 form an integral part of these financial statements.

The financial statements on pages 149 to 179 were approved by the Board of Directors on 14 June 2023 and were signed on its behalf by:

Allan Lockhart

Chief Executive

Officer

Will Hobman

Chief Financial Officer

Registered number: 10221027

150

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

For the year ended 31 March 2023

2023

£m

2022

£m

Cash flows from operating activities

(Loss) / profit for the year before taxation

– continuing operations (16.8)

7.0

Loss for the year before taxation

– discontinued operations – (31.7)

Loss for the year before taxation

(16.8)

(24.7)

Adjustments for:

Loss on disposal of

investment property 3.8 3.4

Loss on disposal of Hawthorn

– 39.7

Net valuation movement

38.2 12.3

Net valuation movement in joint ventures

(0.6)

(2.9)

Net valuation movement in associates

(0.2)

(2.9)

Share of profit from joint ventures

(2. 4)

(1.1)

Share of profit from associates

(0.1)

(0.2)

Net interest expense

14.0 18.4

Rent free lease incentives

0.2 (1.4)

Movement in expected credit loss

(0.1)

(0.3)

(Capitalisation) / amortisation of legal and letting fees

(0.1)

0.1

Depreciation on property plant and equipment

0.8 1.2

-based payment expense 0.9 0.9

Cash generated from operations before changes in working capital

37.6 42.5

Changes in

working capital

Decrease in trade and other receivables

3.0 9 .7

(Decrease) / increase in payables and other financial liabilities

(4.3)

7.6

Cash generated from operations

36.3 59.8

Interest paid

(14.1)

(20.3)

Dividends received from joint

ventures 3.2 5.6

Dividends received from associates

0.4 2 .0

Net cash generated from operating activities

25.8 47.1

Cash flows from investing activities

Cash proceeds net of cash disposed and transaction costs from disposal of subsidiaries

– 196.0

Interest income

1.2 0.4

Investment in associate

– (4.0)

Return of investment from associate

2.3 –

Disposal of associate investments

– 2.5

Purchase of investment properties

– (7.3)

Disposal of investment properties

19.5 65.2

Development and other capital expenditure

(2.9)

(9.6)

Purchase of plant and equipment

(0.1)

(3.0)

Net cash generated from investing activities

20.0 240.2

Cash flows from financing activities

Repayment of bank loans

– (335.0)

Repayment of

principal portion of lease liability (0.4)

(0.7)

Dividends paid

– ordinary (19.6)

(19.3)

Net cash used in financing activities

(20.0)

(355.0)

Cash and cash equivalents at beginning of the year

82.8 150.5

Net increase in / (decrease) in cash and

cash equivalents 25.8 (67.7)

Cash and cash equivalents at 31 March

108.6 82.8

The notes on pages 153 to 179 form an integral part of these financial statements.

CCoonnssoolliiddaatteedd BBaallaannccee SShheeeett

As at 31 March 2023

Notes

2023

£m

2022

£m

Non-current assets

Investment properties

627.3

684.6

Right of use asset

0.9

0.2

Investments in joint ventures

23.8

24.0

Investments in associates

5.5

7.9

Property, plant and equipment

0.4

0.7

Total non-current assets

657.9

717.4

Current assets

Trade and other receivables

15.0

18.9

Cash and cash equivalents

108.6

82.8

Total current assets

123.6

101.7

Total assets

781.5

819.1

Equity and liabilities

Current liabilities

Trade and other payables

29.5

33.5

Lease liability

0.4

0.7

Total current liabilities

29.9

34.2

Non-current liabilities

Lease liability

76.3

75.0

Borrowings

296.7

295.8

Total non-current liabilities

373.0

370.8

Net assets

378.6

414.1

Equity

Share capital

3.1

Share premium

2.4

1.1

Merger reserve

(2.3)

Retained earnings and other reserves

375.4

412.2

Total equity

378.6

414.1

Net Asset Value (NAV) per share (pence)

Basic

122p

135p

Diluted

121p

134p

EPRA NTA

121p

134p

The notes on pages 153 to 179 form an integral part of these financial statements.

The financial statements on pages 149 to 179 were approved by the Board of Directors on 14 June 2023 and were signed on its behalf by:

Allan Lockhart

Chief Executive Officer

Will Hobman

Chief Financial Officer

Registered number: 10221027

151

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

For the year ended 31 March 2023

Notes

capital

£m

premium

£m

Merger

reserve

£m

Retained

earnings and

other reserves

£m

Total

£m

As at 1 April 2021

3.1 227.4 (2.3)

232.2 460.4

Loss for the year after taxation

–

continuing operations – – – 7.0

7.0

–

discontinued operations – – – (33.6)

(33.6)

Loss for the year after taxation

– – – (26.6)

(26.6)

Total

comprehensive loss for the year after taxation

– – – (26.6)

(26.6)

Tran

sactions with equity holders

Transfer from share premium

– (227.4) – 227.4 –

Issue of new shares

– 1.1 – – 1.1

-based payments

– – – 0.9 0.9

Dividends paid

13 – – – (21.7)

(21.7)

As at 31 March 2022

3.1 1.1 (2.3)

412.2 414.1

Loss for the year after taxation

– – – (16.8)

(16.8)

Total comprehensive loss for the year after taxation

– – – (16.8)

(16.8)

Transactions with equity holders

Issue of new shares

– 1.3 – – 1.3

-based payments – – – 0 .9 0.9

Dividends paid

13 – – – (20.9)

(20.9)

As at 31 March 2023

3.1 2.4 (2.3)

375.4 378.6

The notes on pages 153 to 179 form an integral part of these financial statements.

152

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

1. Accounting policies

General information

NewRiver REIT plc (the ‘Company’) and its subsidiaries (together the ‘Group’) is a property investment group specialising in commercial real

estate in the UK. The Company is registered and domiciled in the UK and the registered office of the Company is 89 Whitfield Street, London,

W1T 4DE.

Summary of significant accounting policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have

been consistently applied to all years presented.

Basis of preparation

These consolidated financial statements have been prepared on the going concern basis, in accordance with the Disclosure and Transparency

Rules of the Financial Conduct Authority, in accordance with UK-adopted International Accounting Standards and within the requirements of the

Companies Act 2006.

Going concern

The Group and Company’s going concern assessment considers the Group and Company’s principal risks, and is dependent on a number of

factors, including cashflow and liquidity, continued access to borrowing facilities and the ability to continue to operate the Group and Company’s

unsecured debt structure within its financial covenants. The Group and Company’s balance sheet is unsecured, which means that none of its

debt is secured against any of its property assets. This type of financing affords significant operational flexibility and the only debt currently

drawn by the Group is the £300 million unsecured corporate bond which matures in March 2028. This bond has financial covenants that the

Group is required to comply with including an LTV covenant of less than 65% and a 12 month historical interest cover ratio of more than 1.5x.

The going concern assessment is based on a 12 month outlook from the date of the approval of these financial statements, using the Group and

Company’s Board approved budget, flexed to create a reasonable worst case scenario, which includes the key assumptions listed below.

- Capital values to decrease a further 10% during FY24 and remain flat throughout the remainder of the forecast horizon, in contrast to the decline

noted in FY23 of –5.9% across the portfolio in FY23, 62% of which related to the impact of cost inflation on valuations for the regeneration

portfolio with more modest declines noted in the Core Shopping Centres and Retail Parks.

- A 15% reduction in net income. This reflects a significant downside to rental agreements re-geared or re-negotiated throughout the pandemic

given that 95% of rents relating to FY21 and FY22 has been collected at the time of reporting despite the multiple national lockdowns in place

throughout those periods; FY23 rent collection is 98% and 1Q24 rent collection is 91% at the time of reporting demonstrating that rent collection

rates have normalised back to pre Covid levels;

- No disposal proceeds are assumed throughout the forecast period which have not yet completed at the time of reporting, despite the

completion of £77 million of disposals during FY22, £23 million during FY23 and £32 million of retail disposals now under offer or exchanged

and a further £30 million in active discussions or committed to be disposed at the date of approval of these financial statements. Similarly, no

assumption is made for the deployment of any surplus capital available as at 31 March 2023 and the growth and returns that would

otherwise generate.

Under this scenario, the Group and Company is forecast to maintain sufficient cash and liquidity resources and remain compliant with its

financial covenants over the going concern period. Further stress testing was performed on this scenario which demonstrated that the Group

and Company’s drawn debt covenants could absorb a further valuation decline of 37% or a further 46% reduction in annual net rental income

before breaching covenant levels. The Group and Company maintains sufficient cash and liquidity reserves to continue in operation and pay its

liabilities as they fall due throughout the going concern assessment period and as such the Directors conclude a going concern basis of

preparation is appropriate.

Cash flow statement

The Group has reported the cash flows from operating activities using the indirect method. Interest received and the acquisition of properties

are presented within investing cash flows and interest paid is presented within operating cash flows because this most appropriately reflects the

Group’s business activities.

CCoonnssoolliiddaatteedd SSttaatteemmeenntt

ooff CChhaannggeess iinn EEqquuiittyy

For the year ended 31 March 2023

Notes

capital

£m

premium

£m

Merger

reserve

£m

Retained

earnings and

other reserves

£m

Total

£m

As at 1 April 2021

3.1

227.4

(2.3)

232.2

460.4

Loss for the year after taxation

– continuing operations

–

7.0

– discontinued operations

–

(33.6)

Loss for the year after taxation

–

(26.6)

Total comprehensive loss for the year after taxation

–

(26.6)

Transactions with equity holders

Transfer from share premium

–

(227.4)

–

227.4

–

Issue of new shares

–

1.1

–

1.1

Share-based payments

–

0.9

Dividends paid

–

(21.7)

As at 31 March 2022

3.1

1.1

(2.3)

412.2

414.1

Loss for the year after taxation

–

(16.8)

Total comprehensive loss for the year after taxation

–

(16.8)

Transactions with equity holders

Issue of new shares

–

1.3

–

1.3

Share-based payments

–

0.9

Dividends paid

–

(20.9)

As at 31 March 2023

3.1

2.4

(2.3)

375.4

378.6

The notes on pages 153 to 179 form an integral part of these financial statements.

153

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Notes to the financial statements continued

1. Accounting policies continued

Preparation of the consolidated financial statements

The consolidated financial statements incorporate the financial statements of the Company and its subsidiaries controlled by the Company,

made up to 31 March each year. Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with

the entity and has the ability to affect those returns through its power over the investee.

The consolidated financial statements account for interest in joint ventures and associates using the equity method of accounting per IFRS 11

and IAS 28 respectively. The financial statements for the year ended 31 March 2023 have been prepared on the historical cost basis, except for

the revaluation of investment properties.

New accounting policies

The Group has adopted the following amendments for the first time in the year ended 31 March 2023:

- Annual Improvements to IFRS Standards 2018–2020

- Property, Plant and Equipment – Proceeds before Intended Use (Amendments to IAS 16)

- Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37)

- Reference to the Conceptual Framework (Amendments to IFRS 3)

Adopting these amendments has not impacted amounts recognised in prior periods or are expected to have a material impact on the current

period or future periods based on the Group’s current strategy. The accounting policies used are otherwise consistent with those contained in

the Group’s previous Annual Report and Accounts for the year ended 31 March 2022.

Standards and amendments issued but not yet effective

A number of new amendments have been issued but are not yet effective for the current accounting period.

Effective for the year ended 31 March 2024

- Classification of Liabilities as Current or Non-current (Amendments to IAS 1)

- Definition of Accounting Estimates (Amendments to IAS 8)

- Deferred Tax – Related to assets and liabilities arising from a single transactions (Amendments to IAS 12)

- Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)

- Insurance contracts – (Amendments to IFRS 17)

Effective for the year ended 31 March 2025:

- Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)

- Non-current Liabilities with Covenants (Amendments to IAS 1)

No material impact is expected upon the adoption of these standards.

IFRIC Agenda Decision

In October 2022, the IFRS Interpretations Committee (‘IFRIC’) released its decision on the application of IFRS 9 and IFRS 16 in relation to how a

lessor should account for the forgiveness of amounts due under leases. This concluded that for any rent receivables that are past their due

dates and subsequently forgiven, the lessor should apply the expected credit loss (ECL) model in IFRS 9. Therefore, the forgiveness will be

subject to the derecognition and impairment requirements in IFRS 9, and the impact of relevant receivable amounts written off reflected in the

statement of comprehensive income on the date that the legal rights are conceded. Historically the Group has treated this as a lease

modification spread over the remaining lease term. The Group is not materially impacted by this decision and therefore no restatement of the

prior year comparative is required.

In March 2022, IFRIC finalised its decision with respect to the treatment of demand deposits with restriction on use, which includes tenant rent

deposits and service charge amounts collected on behalf of tenants. It was concluded that such deposits which are subject to contractual

restrictions, meet the definition of ‘cash and cash equivalents’ within the financial statements. In light of this the Group performed a review of

amounts disclosed as ‘restricted monetary assets’ and tenant deposits. The Group is not subject to such contractual restrictions, and therefore

no restatement of the prior year comparative is required.

154

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

Revenue recognition

Property, rental and related income

Property, rental and related income from fixed and minimum guaranteed rent reviews is recognised on a straight-line basis over the entire lease

term. Where such rental income is recognised ahead of the related cash flow, an adjustment is made to ensure the carrying value of the related

property including the accrued rent does not exceed the external valuation. Initial direct costs incurred in negotiating and arranging a new lease

are amortised on a straight-line basis over the period from the date of lease commencement to the expiry date of the lease.

Where a rent-free period is included in a lease, this is recognised over the lease term, on a straight-line basis, as a reduction of rental income.

Where a lease incentive payment or surrender premiums are paid to enhance the value of a property, it is amortised on a straight- line basis

over the period from the date of lease commencement to the expiry date of the lease as a reduction of rental income. It is management’s policy

to recognise all material lease incentives and lease incentives greater than six months. Upon receipt of a surrender premium for the early

determination of a lease, the profit, net of dilapidations and non-recoverable outgoings relating to the lease concerned, is accounted for from

the effective date of the modification, being the date at which both parties agree to the modification, considering any prepaid or accrued lease

payments relating to the original lease as part of the lease payments for the new lease.

Letting costs are recognised over the lease term on a straight line basis as a reduction of rental income.

Service charge income

Service charge income is recognised in accordance with IFRS 15. This income stream is recognised in the period which it is earnt and when

performance obligations are met.

IFRS 15 is based on the principle that revenue is recognised when control passes to a customer. The majority of the Group’s income is from

tenant leases and is therefore outside of the scope of IFRS 15. However, the standard applies to service charge income. Under IFRS 15, the

Group needs to consider the agent versus principal guidance. The Group is principal in the transaction if they control the specified goods or

services before they are transferred to the customer. In the provision of service charge, the Group has deemed itself to be principal and

therefore the consolidated statement of comprehensive income and the consolidated balance sheet reflect service charge income, expenses,

trade and other receivables and trade and other payables.

Asset management fees

Management fees are recognised in the consolidated statement of comprehensive income as the services are delivered and performance

obligations met. The Group assesses whether the individual elements of service in the agreement are separate performance obligations. Where

the agreements include multiple performance obligations, the transaction price will be allocated to each performance obligation.

Car park income

Car park income is recognised in accordance with IFRS 15. This income stream is recognised in the period in which it is earnt and when

performance obligations are made.

Other income

Other income is recognised in accordance with IFRS 15. This income stream is recognised in the period in which it is earnt and when

performance obligations are made. In the case of insurance other income, this is recognised upon agreement with the insurer.

Promote payments

The Group is contractually entitled to receive a promote payment should the returns from a joint venture or associate to the joint venture or

associate partner exceed a certain internal rate of return. This payment is only receivable by the Group on disposal of underlying properties held

by the joint venture or associate or other termination events. Any entitlements under these arrangements are only accrued for in the financial

statements once the Group believes the above performance conditions have been met and there is no risk of the revenue reversing.

IFRS 15

All revenue streams under IFRS 15 allocate transaction price against performance obligations as they are satisfied. With the exception of asset

management fees, IFRS 15 revenue streams do not carry variable consideration. There are no significant judgements in applying IFRS 15. There

are no significant payment terms on any of the IFRS 15 revenue streams.

Notes to the financial statements continued

1. Accounting policies continued

Preparation of the consolidated financial statements

The consolidated financial statements incorporate the financial statements of the Company and its subsidiaries controlled by the Company,

made up to 31 March each year. Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with

the entity and has the ability to affect those returns through its power over the investee.

The consolidated financial statements account for interest in joint ventures and associates using the equity method of accounting per IFRS 11

and IAS 28 respectively. The financial statements for the year ended 31 March 2023 have been prepared on the historical cost basis, except for

the revaluation of investment properties.

New accounting policies

The Group has adopted the following amendments for the first time in the year ended 31 March 2023:

- Annual Improvements to IFRS Standards 2018–2020

- Property, Plant and Equipment – Proceeds before Intended Use (Amendments to IAS 16)

- Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS 37)

- Reference to the Conceptual Framework (Amendments to IFRS 3)

Adopting these amendments has not impacted amounts recognised in prior periods or are expected to have a material impact on the current

period or future periods based on the Group’s current strategy. The accounting policies used are otherwise consistent with those contained in

the Group’s previous Annual Report and Accounts for the year ended 31 March 2022.

Standards and amendments issued but not yet effective

A number of new amendments have been issued but are not yet effective for the current accounting period.

Effective for the year ended 31 March 2024

- Classification of Liabilities as Current or Non-current (Amendments to IAS 1)

- Definition of Accounting Estimates (Amendments to IAS 8)

- Deferred Tax – Related to assets and liabilities arising from a single transactions (Amendments to IAS 12)

- Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement 2)

- Insurance contracts – (Amendments to IFRS 17)

Effective for the year ended 31 March 2025:

- Lease Liability in a Sale and Leaseback (Amendments to IFRS 16)

- Non-current Liabilities with Covenants (Amendments to IAS 1)

No material impact is expected upon the adoption of these standards.

IFRIC Agenda Decision

In October 2022, the IFRS Interpretations Committee (‘IFRIC’) released its decision on the application of IFRS 9 and IFRS 16 in relation to how a

lessor should account for the forgiveness of amounts due under leases. This concluded that for any rent receivables that are past their due

dates and subsequently forgiven, the lessor should apply the expected credit loss (ECL) model in IFRS 9. Therefore, the forgiveness will be

subject to the derecognition and impairment requirements in IFRS 9, and the impact of relevant receivable amounts written off reflected in the

statement of comprehensive income on the date that the legal rights are conceded. Historically the Group has treated this as a lease

modification spread over the remaining lease term. The Group is not materially impacted by this decision and therefore no restatement of the

prior year comparative is required.

In March 2022, IFRIC finalised its decision with respect to the treatment of demand deposits with restriction on use, which includes tenant rent

deposits and service charge amounts collected on behalf of tenants. It was concluded that such deposits which are subject to contractual

restrictions, meet the definition of ‘cash and cash equivalents’ within the financial statements. In light of this the Group performed a review of

amounts disclosed as ‘restricted monetary assets’ and tenant deposits. The Group is not subject to such contractual restrictions, and therefore

no restatement of the prior year comparative is required.

155

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Notes to the financial statements continued

1. Accounting policies continued

Service charge expense

Service charge expenses are recognised in the period in which they are incurred.

Finance income and costs

Finance income and costs excluding fair value derivative movements, are recognised using the effective interest rate method. The effective

interest rate method is a method of calculating the amortised cost of a financial asset or financial liability and of allocating the interest income or

interest expense over the relevant period. The effective interest rate is the rate that discounts estimated future cash payments or receipts

throughout the expected life of the financial instrument, or a shorter period where appropriate, to the net carrying amount of the financial asset

or financial liability.

Taxation

Income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the date of the balance sheet. Tax

is recognised in the consolidated statement of comprehensive income.

Deferred tax

Any deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax

rates that are expected to apply in the period when the liability is settled or the asset is realised. A deferred tax asset is recognised only to the

extent that it is probable that future taxable profits will be available against which the asset can be utilised.

Investment properties

These properties include completed properties that are generating rent or are available for rent, and development properties that are under

development or available for development. Investment properties comprise freehold and leasehold properties and are first measured at cost

(including transaction costs), then revalued to market value at each reporting date by independent professional valuers. Leasehold properties

are shown gross of the leasehold payables (and accounted for as right-of-use asset under IFRS 16, see Leases accounting policy). Valuation

gains and losses in a period are taken to the consolidated statement of comprehensive income. As the Group uses the fair value model, as per

IAS 40 Investment Properties, no depreciation is provided. An asset will be classified as held for sale within investment properties, in line with

IFRS 5 Non-Current Assets Held for Sale and Discontinued Operations, where the asset is available for immediate sale in its present condition

and the sale is highly probable.

Property, plant and equipment

Fixtures and equipment are stated at cost less accumulated depreciation and any recognised impairment loss. Depreciation is recognised over

the useful lives of the equipment, using the straight-line method at a rate of between 10% to 25% depending on the useful life.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the

following bases:

- Fixtures and fittings 20% on a straight line-basis depending on the useful life

- Office equipment 33% on a straight line-basis

Joint ventures

Interests in joint ventures are accounted for using the equity method of accounting. The Group’s joint ventures are entities over which the Group

has joint control with a partner. Investments in joint ventures are carried in the consolidated balance sheet at cost as adjusted by post-

acquisition changes in the Group’s share of the net assets of the joint venture, less any impairment or share of income adjusted for dividends. In

assessing whether a particular entity is controlled, the Group considers all of the contractual terms of the arrangement, whether it has the power

to govern the financial and operating policies of the joint venture so as to obtain benefits from its activities, and the existence of any legal

disputes or challenges to this joint control in order to conclude whether the Group jointly controls the joint venture.

Associates

Interests in associates are accounted for using the equity method of accounting. The Group’s associates are entities over which the Group

has significant influence with a partner. Investments in associates are carried in the consolidated balance sheet at cost as adjusted by post-

acquisition changes in the Group’s share of the net assets of the associates, less any impairment or share of income adjusted for dividends.

In assessing whether a particular entity is controlled or has significant influence, the Group considers all of the contractual terms of the

arrangement, whether it has the power to govern the financial and operating policies of the associate so as to obtain benefits from its activities.

156

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

Leases

At inception, the Group assesses whether a contract is or contains a lease. This assessment involves the exercise of judgement about whether

the Group obtains substantially all the economic benefits from the use of that asset, and whether the Group has the right to direct the use of

the asset.

The Group recognises a right-of-use (“ROU”) asset and the lease liability at the commencement date of the lease. The ROU asset is initially

measured based on the present value of lease payments, plus initial direct costs and the cost of obligations to restore the asset, less any

incentives received.

Lease payments generally include fixed payments and variable payments that depend on an index (such as an inflation index).

Each lease payment is allocated between the liability and finance cost. The lease payments are discounted using the interest rate implicit in the

lease if that rate can be readily determined or if not, the incremental borrowing rate is used. The finance cost is charged to profit or loss over the

lease period so as to produce a constant rate of interest on the remaining balance of the liability for each period.

The ROU asset is depreciated over the shorter of the lease term or the useful life of the underlying asset. The ROU asset is subject to testing for

impairment if there is an indicator of impairment. ROU assets that are not classified as investment properties are disclosed on the face of the

consolidated balance sheet on their own line, and the lease liability included in the headings current and non-current liabilities on the

consolidated balance sheet.

Where the ROU asset relates to leases of land or property that meets the definition of investment property under IAS 40 it has been disclosed

within the investment property balance. After initial recognition, IAS 40 requires the amount of the recognised lease liability, calculated in

accordance with IFRS 16, to be added back to the amount determined under the net valuation model, to arrive at the carrying amount of the

investment property under the fair value model. Differences between the ROU asset and associated lease liability are taken to the consolidated

statement of comprehensive income.

The Group has elected not to recognise ROU assets and liabilities for leases where the total lease term is less than or equal to 12 months, or for

low value leases of less than £3,000. The payments for such leases are recognised in the consolidated statement of comprehensive income on

a straight-line basis over the lease term.

Financial instruments

Financial assets

The Group classifies its financial assets as fair value through profit or loss or amortised cost, depending on the purpose for which the asset was

acquired and based on the business model test. Financial assets carried at amortised cost include tenant receivables which arise from the

provision of goods and services to customers. These are initially recognised at fair value plus transaction costs that are directly attributable to

their acquisition or issue and are subsequently carried at amortised cost, less provision for impairment. Impairment provisions for receivables are

recognised based on the simplified approach within IFRS 9 using a provision matrix in the determination of the lifetime expected credit losses.

The probability of tenant default and subsequent non-payment of the receivable is assessed. If it is determined that the receivable will not be

collectable, the gross carrying value of the asset is written off against the associated provision. If in a subsequent year the amount of the

impairment loss decreased and the decrease can be related objectively to an event occurring after the impairment was recognised, the

previously recognised impairment loss is reversed to the extent that the carrying value of the asset does not exceed its amortised costs at the

reversal date. The Group’s financial assets measured at amortised cost comprise trade and other receivables and cash and cash equivalents.

Financial assets are derecognised only when the contractual rights to the cash flows from the financial asset expire or the Group transfers

substantially all risks and rewards of ownership.

Cash and cash equivalents

Cash and cash equivalents include cash on hand, cash in transit, deposits held on call with financial institutions, other short-term, highly liquid

investments with original maturities of three months or less that are readily convertible into known amounts of cash and which are subject to an

insignificant risk of change in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the consolidated

balance sheet.

Notes to the financial statements continued

1. Accounting policies continued

Service charge expense

Service charge expenses are recognised in the period in which they are incurred.

Finance income and costs

Finance income and costs excluding fair value derivative movements, are recognised using the effective interest rate method. The effective

interest rate method is a method of calculating the amortised cost of a financial asset or financial liability and of allocating the interest income or

interest expense over the relevant period. The effective interest rate is the rate that discounts estimated future cash payments or receipts

throughout the expected life of the financial instrument, or a shorter period where appropriate, to the net carrying amount of the financial asset

or financial liability.

Taxation

Income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the date of the balance sheet. Tax

is recognised in the consolidated statement of comprehensive income.

Deferred tax

Any deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax

rates that are expected to apply in the period when the liability is settled or the asset is realised. A deferred tax asset is recognised only to the

extent that it is probable that future taxable profits will be available against which the asset can be utilised.

Investment properties

These properties include completed properties that are generating rent or are available for rent, and development properties that are under

development or available for development. Investment properties comprise freehold and leasehold properties and are first measured at cost

(including transaction costs), then revalued to market value at each reporting date by independent professional valuers. Leasehold properties

are shown gross of the leasehold payables (and accounted for as right-of-use asset under IFRS 16, see Leases accounting policy). Valuation

gains and losses in a period are taken to the consolidated statement of comprehensive income. As the Group uses the fair value model, as per

IAS 40 Investment Properties, no depreciation is provided. An asset will be classified as held for sale within investment properties, in line with

IFRS 5 Non-Current Assets Held for Sale and Discontinued Operations, where the asset is available for immediate sale in its present condition

and the sale is highly probable.

Property, plant and equipment

Fixtures and equipment are stated at cost less accumulated depreciation and any recognised impairment loss. Depreciation is recognised over

the useful lives of the equipment, using the straight-line method at a rate of between 10% to 25% depending on the useful life.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the

following bases:

- Fixtures and fittings 20% on a straight line-basis depending on the useful life

- Office equipment 33% on a straight line-basis

Joint ventures

Interests in joint ventures are accounted for using the equity method of accounting. The Group’s joint ventures are entities over which the Group

has joint control with a partner. Investments in joint ventures are carried in the consolidated balance sheet at cost as adjusted by post-

acquisition changes in the Group’s share of the net assets of the joint venture, less any impairment or share of income adjusted for dividends. In

assessing whether a particular entity is controlled, the Group considers all of the contractual terms of the arrangement, whether it has the power

to govern the financial and operating policies of the joint venture so as to obtain benefits from its activities, and the existence of any legal

disputes or challenges to this joint control in order to conclude whether the Group jointly controls the joint venture.

Associates

Interests in associates are accounted for using the equity method of accounting. The Group’s associates are entities over which the Group

has significant influence with a partner. Investments in associates are carried in the consolidated balance sheet at cost as adjusted by post-

acquisition changes in the Group’s share of the net assets of the associates, less any impairment or share of income adjusted for dividends.

In assessing whether a particular entity is controlled or has significant influence, the Group considers all of the contractual terms of the

arrangement, whether it has the power to govern the financial and operating policies of the associate so as to obtain benefits from its activities.

157

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Notes to the financial statements continued

1. Accounting policies continued

Financial liabilities

The Group classifies its financial liabilities at amortised cost. A financial liability is derecognised when the obligation under the liability is

discharged or cancelled or expires.

All loans and borrowings are classified as other liabilities. Initial recognition is at fair value less directly attributable transaction costs. After initial

recognition, interest bearing loans and borrowings are subsequently measured at amortised costs using the effective interest method.

Financial liabilities included in trade and other payables are recognised initially at fair value and subsequently at amortised cost.

The financial instruments classified as financial liabilities at fair value through profit or loss include interest rate swap and cap arrangements.

Recognition of the derivative financial instruments takes place when the contracts are entered into. They are recognised at fair value and

transaction costs are included directly in finance costs.

The fair value of a non-interest bearing liability is its discounted repayment amount. If the due date of the liability is less than one year,

discounting is omitted.

Value added tax

Revenues, expenses and assets are recognised net of the amount of value added tax except:

Where the value added tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case the value

added tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and receivables and payables

that are stated with the amount of value added tax included. The net amount of value added tax recoverable from, or payable to, the taxation

authority is included as part of receivables or payables in the consolidated balance sheet.

Share capital

Shares are classified as equity when there is no obligation to transfer cash or other assets. The cost of issuing share capital is recognised

directly in equity against the proceeds from issuing the shares.

Share-based payments

The cost of equity settled transactions is measured with reference to the fair value at the date at which they were granted. Where vesting

performance conditions are non-market based, the fair value excludes the effect of these vesting conditions and an estimate is made at each

year end date of the number of instruments expected to vest. The fair value is recognised over the vesting period in the consolidated statement

of comprehensive income, with a corresponding increase in equity. Any change to the number of instruments with non-market vesting

conditions expected to vest is recognised in the consolidated statement of comprehensive income for that period.

Employee Benefit Trust

The Group operates an Employee Benefit Trust for the exclusive benefit of the Group’s employees. The investment in the Company’s shares

held by the trust is recognised at cost and deducted from equity. No gain or loss is recognised in the consolidated statement of comprehensive

income on the purchase, sale, issue or cancellation of the shares held by the trust.

Dividends

Dividends to the Company’s shareholders are recognised when they become legally payable. In the case of interim dividends, this is when paid.

In the case of final dividends, this is when approved by equity holders.

Business combinations

The Group applies the acquisition method to account for business combinations. The cost of the acquisition is measured at the aggregate of the

fair values, at the date of completion, of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for

control of the acquired. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS

are recognised at their fair value at the acquisition. Where the fair value of the consideration is less than the fair value of the identifiable assets

and liabilities then the difference is recognised as a bargain purchase in the consolidated statement of comprehensive income.

Where properties are acquired through corporate acquisitions, each transaction is considered by management in light of the substance of the

acquisition to determine whether the acquisition is a business combination or an asset acquisition. If a transaction is determined to be an asset

acquisition then it is accounted for at cost.

158

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

2. Critical accounting judgements and estimates

The preparation of financial statements requires management to make estimates and judgements affecting the reported amounts of assets and

liabilities, of revenues and expenses, and of gains and losses. The key assumptions concerning the future, and other key sources of estimation

uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and

liabilities within the next financial year, are discussed below. Estimates and judgements are continually evaluated and are based on historical

experience as adjusted for current market conditions and other factors.

Significant judgements

REIT Status

NewRiver is a Real Estate Investment Trust (REIT) and does not pay tax on its property income or gains on property sales, provided that at least

90% of the Group’s property income is distributed as a dividend to shareholders, which becomes taxable in their hands. In addition, the Group

has to meet certain conditions such as ensuring the property rental business represents more than 75% of total profits and assets. Any potential

or proposed changes to the REIT legislation are monitored and discussed with HMRC. It is the Directors judgement that the Group has met the

REIT conditions in the year.

Sources of estimation uncertainty

Investment property

The Group’s investment properties are stated at fair value. The assumptions and estimates used to value the properties are detailed in note 14.

Small changes in the key estimates, such as the estimated rental value, can have a significant impact on the valuation of the investment

properties, and therefore a significant impact on the consolidated balance sheet and key performance measures such as Net Tangible Assets

per share.

Rents and ERVs have a direct relationship to valuation, while yield has an inverse relationship. Estimated costs of a development project will

inversely affect the valuation of development properties. There are interrelationships between all these unobservable inputs as they are

determined by market conditions. The existence of an increase in more than one unobservable input could be to magnify the impact on the

valuation, see note 14 for sensitivity analysis.

The estimated fair value may differ from the price at which the Group’s assets could be sold. Actual realisation of net assets could differ from the

valuation used in these financial statements, and the difference could be significant.

3. Segmental reporting and discontinued operations

The Group operates as one segment, the retail business. The retail investments comprise shopping centres, retail parks and high street stores.

The Group’s Executive Committee examines the Group’s performance, and have identified retail as the only operating segment. The

performance and position of the retail business is set out in the consolidated statement of comprehensive income and consolidated balance

sheet. All the Group’s operations are in the UK and therefore no geographical segments have been identified.

4. Revenue

2023

£m

2022

£m

Property rental and related income*

58.2 57.7

Amortisation of tenant

incentives and letting costs (1.5)

(1.3)

Surrender premiums and commissions

0.6 0.8

Rental related income

57.3 57.2

Asset management fees

1.5 1.9

Service charge income

13.4 14.6

Revenue

72.2 73.7

* Included within property rental and related income is car park income of £5.3 million (2022: £4.9 million) which falls under the scope of IFRS 15. The remainder of

the income is covered by IFRS 16.

Asset management fees and service charge income which represents the flow through costs of the day-to-day maintenance of shopping

centres fall under the scope of IFRS 15.Total revenue recognised under IFRS 15 is £21.6 million (2022: £21.4 million). Refer to accounting policies

in note 1.

5. Property operating expenses

2023

£m

2022

£m

Service charge expense

19.0 20.3

Rates on vacant units

2.7 1.8

Expected credit loss reversal

(0.1)

(0.3)

Other property operating expenses

3.5 3.7

Property operating expenses

25.1 25.5

Notes to the financial statements continued

1. Accounting policies continued

Financial liabilities

The Group classifies its financial liabilities at amortised cost. A financial liability is derecognised when the obligation under the liability is

discharged or cancelled or expires.

All loans and borrowings are classified as other liabilities. Initial recognition is at fair value less directly attributable transaction costs. After initial

recognition, interest bearing loans and borrowings are subsequently measured at amortised costs using the effective interest method.

Financial liabilities included in trade and other payables are recognised initially at fair value and subsequently at amortised cost.

The financial instruments classified as financial liabilities at fair value through profit or loss include interest rate swap and cap arrangements.

Recognition of the derivative financial instruments takes place when the contracts are entered into. They are recognised at fair value and

transaction costs are included directly in finance costs.

The fair value of a non-interest bearing liability is its discounted repayment amount. If the due date of the liability is less than one year,

discounting is omitted.

Value added tax

Revenues, expenses and assets are recognised net of the amount of value added tax except:

Where the value added tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case the value

added tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and receivables and payables

that are stated with the amount of value added tax included. The net amount of value added tax recoverable from, or payable to, the taxation

authority is included as part of receivables or payables in the consolidated balance sheet.

Share capital

Shares are classified as equity when there is no obligation to transfer cash or other assets. The cost of issuing share capital is recognised

directly in equity against the proceeds from issuing the shares.

Share-based payments

The cost of equity settled transactions is measured with reference to the fair value at the date at which they were granted. Where vesting

performance conditions are non-market based, the fair value excludes the effect of these vesting conditions and an estimate is made at each

year end date of the number of instruments expected to vest. The fair value is recognised over the vesting period in the consolidated statement

of comprehensive income, with a corresponding increase in equity. Any change to the number of instruments with non-market vesting

conditions expected to vest is recognised in the consolidated statement of comprehensive income for that period.

Employee Benefit Trust

The Group operates an Employee Benefit Trust for the exclusive benefit of the Group’s employees. The investment in the Company’s shares

held by the trust is recognised at cost and deducted from equity. No gain or loss is recognised in the consolidated statement of comprehensive

income on the purchase, sale, issue or cancellation of the shares held by the trust.

Dividends

Dividends to the Company’s shareholders are recognised when they become legally payable. In the case of interim dividends, this is when paid.

In the case of final dividends, this is when approved by equity holders.

Business combinations

The Group applies the acquisition method to account for business combinations. The cost of the acquisition is measured at the aggregate of the

fair values, at the date of completion, of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for

control of the acquired. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS

are recognised at their fair value at the acquisition. Where the fair value of the consideration is less than the fair value of the identifiable assets

and liabilities then the difference is recognised as a bargain purchase in the consolidated statement of comprehensive income.

Where properties are acquired through corporate acquisitions, each transaction is considered by management in light of the substance of the

acquisition to determine whether the acquisition is a business combination or an asset acquisition. If a transaction is determined to be an asset

acquisition then it is accounted for at cost.

159

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Notes to the financial statements continued

6. Administrative expenses

2023

£m

2022

£m

Wages and salaries

5.2 5.1

Social security costs

0.9 0.7

Other pension costs

0.1 0.1

Staff costs

6.2 5.9

Depreciation**

0.8 0.1

-based payments 1.1 0.9

Other administrative expenses

4.0 5.6

Head office relocation costs*

0.5 –

Restructuring costs

– 0.9

Administrative expenses

12.6 13.4

* Head office relocation costs mainly relate to an impairment charge relating to property, plant and equipment.

** Depreciation is inclusive of £0.2 million right of use asset depreciation and £0.2 million impairment of the right of use asset.

Net administrative expenses ratio is calculated as follows:

2023

£m

2022

£m

Administrative expenses

12.6 13.4

Adjust for:

Asset management fees

(1.5)

(1.9)

Share of joint ventures’ and associates administrative expenses

0.1 0.2

Share based payments

(1.1)

(0.9)

Head office relocation costs

(0.5)

–

Restructuring costs

– (0.9)

Group’s share of net administrative expenses

– continuing operations 9.6 9.9

Group’s share of net administrative expenses

– discontinued operations – 4.2

Group’s share of net administrative expenses

– Reported Group 9.6 14.1

Property rental and related income*

58.0 58.0

Other income

– Covid-19 income disruption insurance 1.4 –

Share of joint ventures’ and associates’ property income

3.6 3.9

Property rental, other income and related income

– continuing operations 63.0 61.9

Property rental, other income and related income

– discontinued operations – 21.4

Property rental, other income and related income

– Reported Group 63.0 83.3

Net administrative expenses as a % of property income (including share of joint

ventures and associates) –

continuing operations

15.2% 16.0%

Net administrative expenses as a % of property income (including share of joint

ventures and associates) –

Repor

ted Group 15.2% 16.9%

* This balance includes an expected credit loss reversal of £0.1 million (2022: £0.3 million), which excludes the £0.2 million reversal (2022: £0.2 million) forward

looking element of the calculation and insurance expected credit loss of £0.1 million (2022: £nil) but includes the expected credit loss held in joint ventures and

associates of £nil (2022: £0.2 million).

Average monthly number of staff – continuing operations

2023 2022

Directors

7 7

Operations and asset

managers 17 17

Support functions

27 32

Total

51 56

On disposal of Hawthorn 101 employees were employed by subsidiaries that were sold on 20 August 2021.

160

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

Auditors’ remuneration

2023

£m

2022

£m

Audit of the Company and consolidated

financial statements 0.3 0.3

Audit of subsidiaries, pursuant to legislation

0.2 0.2

0.5 0.5

Non

-audit fees – interim review 0.1 0.1

Total fees

0.6 0.6

In addition to this the joint ventures and associates paid £0.1 million (2022: £0.1 million) in audit fees.

7. Other income

2023

£m

2022

£m

Insurance proceeds

1.4 –

Other income

1.4 –

The Group has recognised £1.4m for Covid-19 income disruption following agreement with the insurer.

8. Loss on disposal of subsidiary

Year ended 31 March 2023

There have been no disposals in the year ended 31 March 2023.

Year ended 31 March 2022

Hawthorn

On 20 August 2021 NewRiver REIT plc (‘NRR’) completed the sale of the entire issued share capital of Hawthorn Leisure REIT Limited

(‘Hawthorn’), the entity that held, either directly or indirectly through its wholly-owned subsidiaries, NewRiver’s entire community pub business to

AT Brady Bidco Limited.

Subsidiaries disposed

Hawthorn Leisure REIT Limited

Hawthorn Leisure Limited

Hawthorn Leisure (Bravo Inns) Limited

Hawthorn Leisure Acquisitions Limited

Bravo Inns Limited

Hawthorn Leisure Honey Limited

Bravo Inns II Limited

Hawthorn Leisure Management Limited

Hawthorn Leisure Community Pubs Limited

Hawthorn Leisure Scotco Limited

Hawthorn Leisure (Mantle) Limited

NewRiver Retail Holdings No 4 Limited

Hawthorn

Leisure Public Houses Limited NewRiver Retail Holdings No 7 Limited

Hawthorn Leisure Holdings Limited

NewRiver Retail Property Unit Trust No 4

Results from 1 April 2021 to 20 August 2021

£m

Revenue

18.1

Property operating expenses

(10.9)

Net

property income 7.2

Other income

4.8

Administrative expenses

(4.8)

Loss on disposal of subsidiary

(39.7)

Other

0.8

Loss for the period before taxation

(31.7)

Deferred Tax

(1.9)

Loss for the period after taxation

(33.6)

Notes to the financial statements continued

6. Administrative expenses

2023

£m

2022

£m

Wages and salaries

5.2

5.1

Social security costs

0.9

0.7

Other pension costs

0.1

Staff costs

6.2

5.9

Depreciation**

0.8

0.1

Share-based payments

1.1

0.9

Other administrative expenses

4.0

5.6

Head office relocation costs*

0.5

–

Restructuring costs

–

0.9

Administrative expenses

12.6

13.4

* Head office relocation costs mainly relate to an impairment charge relating to property, plant and equipment.

** Depreciation is inclusive of £0.2 million right of use asset depreciation and £0.2 million impairment of the right of use asset.

Net administrative expenses ratio is calculated as follows:

2023

£m

2022

£m

Administrative expenses

12.6

13.4

Adjust for:

Asset management fees

(1.5)

(1.9)

Share of joint ventures’ and associates administrative expenses

0.1

0.2

Share based payments

(1.1)

(0.9)

Head office relocation costs

(0.5)

–

Restructuring costs

–

(0.9)

Group’s share of net administrative expenses – continuing operations

9.6

9.9

Group’s share of net administrative expenses – discontinued operations

–

4.2

Group’s share of net administrative expenses – Reported Group

9.6

14.1

Property rental and related income*

58.0

Other income – Covid-19 income disruption insurance

1.4

–

Share of joint ventures’ and associates’ property income

3.6

3.9

Property rental, other income and related income – continuing operations

63.0

61.9

Property rental, other income and related income – discontinued operations

–

21.4

Property rental, other income and related income – Reported Group

63.0

83.3

Net administrative expenses as a % of property income (including share of joint ventures and associates) –

continuing operations

15.2%

16.0%

Net administrative expenses as a % of property income (including share of joint ventures and associates) –

Reported Group

15.2%

16.9%

* This balance includes an expected credit loss reversal of £0.1 million (2022: £0.3 million), which excludes the £0.2 million reversal (2022: £0.2 million) forward

looking element of the calculation and insurance expected credit loss of £0.1 million (2022: £nil) but includes the expected credit loss held in joint ventures and

associates of £nil (2022: £0.2 million).

Average monthly number of staff – continuing operations

2023

2022

Directors

Operations and asset managers

Support functions

Total

On disposal of Hawthorn 101 employees were employed by subsidiaries that were sold on 20 August 2021.

161

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Notes to the financial statements continued

8. Loss on disposal of subsidiary continued

Loss on disposal of subsidiary at 20 August 2021

2022

£m

Gross disposal proceeds

224.0

Net assets disposed of:

Investment property

(202.3)

Managed houses

(53.8)

Property, plant and equipment

(1.2)

Cash

(16.6)

Other net liabilities

19.9

Carrying value

(254.0)

Loss on disposal of subsidiary before transaction costs

(30.0)

Transaction costs

(9.7)

Loss on disposal of subsidiary

(39.7)

Cash flows from

1 April 2021 to 20 August 2021

31 March 2022

£m

Cash flows from operating activities

13.8

Cash flows from investing activities

187.9

Total cash flows from discontinued operations

201.7

9. Loss on disposal of investment properties

2023

£m

2022

£m

Gross

disposal proceeds 20.0 66.3

Carrying value

(22.3)

(68.9)

Cost of disposal

(1.5)

(1.6)

Loss on disposal of investment properties

(3.8)

(4.2)

10. Finance income and finance costs

2023

£m

2022

£m

Income from loans with joint

ventures and associates (0.3)

(0.4)

Income from

treasury deposits (1.1)

–

Write off of derivatives

– (1.0)

Finance income

(1.4)

Interest on borrowings

12.7 17.1

Finance cost on lease liabilities

2.7 2.7

Finance costs

15.4 19.8

162

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

11. Taxation

2023

£m

2022

£m

Taxation charge / (credit)

– continuing – –

Taxation charge / (credit)

– discontinued – 1.9

Taxation charge / (credit)

– Reported Group – 1.9

Loss before tax

(16.8)

(24.7)

Tax at

the current rate of 19% (2022: 19%) (3.2)

(4.7)

Revaluation of property

7.3 2.3

Movement in unrecognised deferred tax

(0.2)

2.1

Non

-taxable loss on disposal of subsidiary – 7.6

Non

-taxable profit due to REIT regime (4.4)

(5.4)

Non

-taxable income (0.4)

(0.8)

Transfer pricing adjustment

0.9 0.8

Taxation

(credit) / charge – 1.9

Real Estate Investment Trust regime (REIT regime)

The Group is a member of the REIT regime whereby profits from its UK property rental business are tax exempt. The REIT regime only applies to

certain property-related profits and has several criteria which have to be met. The main criteria are:

- the assets of the property rental business must be at least 75% of the Group’s assets;

- the profit from the tax-exempt property rental business must exceed 75% of the Group’s total profit and;

- at least 90% of the Group’s profit from the property rental business must be paid as dividends.

The Group continues to meet these conditions and management intends that the Group should continue as a REIT for the foreseeable future.

Deferred tax

31 March 2022

£m

Charge

£m

Disposals

£m

31 March 2023

£m

Net deferred tax

– – – –

31 March 2021

£m

Charge

£m

Disposals

£m

31 March 2022

£m

Net

deferred tax (0.7)

(1.9)

2.6 –

The deferred tax assets and liabilities have been calculated at the tax rate effective in the period that the tax is expected to crystallise. The

Group has not recognised a deferred tax liability or deferred tax asset. As at 31 March 2023 the Group has unrecognised tax losses of £13.1

million (2022: £12.5 million). The losses have not been recognised as an asset due to uncertainty over the availability of taxable income to utilise

the losses. The losses do not expire but are reliant on continuity of ownership and source of trade.

Notes to the financial statements continued

8. Loss on disposal of subsidiary continued

Loss on disposal of subsidiary at 20 August 2021

2022

£m

Gross disposal proceeds

224.0

Net assets disposed of:

Investment property

(202.3)

Managed houses

(53.8)

Property, plant and equipment

(1.2)

Cash

(16.6)

Other net liabilities

19.9

Carrying value

(254.0)

Loss on disposal of subsidiary before transaction costs

(30.0)

Transaction costs

(9.7)

Loss on disposal of subsidiary

(39.7)

Cash flows from 1 April 2021 to 20 August 2021

31 March 2022

£m

Cash flows from operating activities

13.8

Cash flows from investing activities

187.9

Total cash flows from discontinued operations

201.7

9. Loss on disposal of investment properties

2023

£m

2022

£m

Gross disposal proceeds

20.0

66.3

Carrying value

(22.3)

(68.9)

Cost of disposal

(1.5)

(1.6)

Loss on disposal of investment properties

(3.8)

(4.2)

10. Finance income and finance costs

2023

£m

2022

£m

Income from loans with joint ventures and associates

(0.3)

(0.4)

Income from treasury deposits

(1.1)

–

Write off of derivatives

–

(1.0)

Finance income

(1.4)

Interest on borrowings

12.7

17.1

Finance cost on lease liabilities

2.7

Finance costs

15.4

19.8

163

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Notes to the financial statements continued

12. Performance measures

A reconciliation of the performance measures to the nearest IFRS measure is below:

Year ended 31 March 2023 Year ended 31 March 2022

Continuing

£m

Discontinued

£m

Total

£m

Continuing

£m

Discontinued

£m

Total

£m

(Loss) / profit

for the year after taxation (16.8)

– (16.8)

7.0 (33.6)

(26.6)

Adjustments

Net valuation movement

38.2 – 38.2 12.3 – 12.3

Loss on disposal of investment properties

3.8 – 3.8 4.2 (0.8)

3.4

Changes in

fair value of financial instruments and associated

close out costs

– – – (0.1)

– (0.1)

Deferred tax

– – – – 1.9 1.9

Loss on disposal of subsidiary

– – – – 39.7 39.7

Group’s share of joint ventures’ and associates’ adjustments

Revaluation of investment properties

(0.8)

– (0.8)

(5.8)

– (5.8)

Revaluation of derivatives

(0.2)

– (0.2)

(0.5)

– (0.5)

Deferred tax

0.2 – 0.2 0.6 – 0.6

Loss on disposal of investment properties

– – – 1.2 – 1.2

EPRA earnings

24.4 – 24.4 18.9 7.2 26.1

-based payment charge 1.1 – 1.1 0.9 – 0.9

Forward looking element of IFRS 9*

(0.2)

– (0.2)

(0.2)

– (0.2)

Depreciation on public houses

– – – – 0.4 0.4

Head office relocation costs

0.5 – 0.5 – – –

Abortive costs

– – – – 0.2 0.2

Restructuring costs

– – – 0.9 – 0.9

Underlying Funds From Operations (UFFO)

25.8 – 25.8 20.5 7.8 28.3

* Forward looking element of IFRS 9 relates to a provision against debtor balances in relation to invoices in advance for future rental income. These balances are not

due in the current year and therefore no income has been recognised in relation to these debtors.

Number of shares

2023

No. m

2022

No. m

Weighted average number of ordinary shares for the purposes of Basic EPS, UFFO and EPRA

309.7 307.2

Effect of dilutive potential ordinary shares:

Performance share plan

1.2 1.1

Deferred bonus shares

0.8 0.7

Weighted average number of

ordinary shares for the purposes of Diluted EPS 311.7 309.0

2023 2022

Continuing Discontinued Total Continuing Discontinued Total

IFRS Basic EPS

(5.4) – (5.4) 2.3 (10.9)

(8.6)

IFRS Diluted EPS

(5.4) – (5.4) 2.3 (10.9)

(8.6)

EPRA

EPS 7.9 – 7.9 6.2 2.3 8.5

UFFO

EPS 8.3 – 8.3 6.7 2.5 9.2

The below table reconciles the differences between the calculation of basic and EPRA NTA.

164

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

EPRA NTA per share and basic NTA per share:

2023 2022

£m

Pence per

£m

Pence per

Net assets

378.6 310.7 122p 414.1 307.2 135p

Unexercised employee awards

– 2.0 – 1.8

Diluted net assets

378.6 312.7 121p 414.1 309.0 134p

Group’s share of associates d

eferred tax liability 0.9 – 0.6 –

Group’s share of joint

venture/associates fair value derivatives (0.6) – (0.3)

–

EPRA

Net Tangible Assets 378.9 312.7 121p 414.4 309.0 134p

13. Dividends

The dividends paid in the year are set out below:

Payment date

PID Non-PID

Pence

per share

£m

Year to March 2022

Ordinary dividends

3 September 2021

3.0 – 3.0 9.1

14 January 2022

4.1 – 4.1 12.6

21.7

Year to March 202

Ordinary dividends

3 September 202

2 3.3 – 3.3 10.1

17 January 2023

3.5 – 3.5 10.8

20.9

The final dividend of 3.2 pence per share in respect of the year ended 31 March 2023 will, subject to shareholder approval at the 2023 AGM,

be paid on 4 August 2023 to shareholders on the register as at 16 June 2023. The dividend will be payable as a REIT Property Income

Distribution (PID).

Property Income Distribution (PID) dividends

Profits distributed out of tax-exempt profits are PID dividends. PID dividends are paid after deduction of withholding tax (currently at 20%), which

NewRiver pays directly to HMRC on behalf of the shareholder.

Non-PID dividends

Any non-PID element of dividends will be treated in exactly the same way as dividends from other UK, non-REIT companies.

Notes to the financial statements continued

12. Performance measures

A reconciliation of the performance measures to the nearest IFRS measure is below:

Year ended 31 March 2023

Year ended 31 March 2022

Continuing

£m

Discontinued

£m

Total

£m

Continuing

£m

Discontinued

£m

Total

£m

(Loss) / profit for the year after taxation

(16.8)

–

(16.8)

7.0

(33.6)

(26.6)

Adjustments

Net valuation movement

38.2

–

38.2

12.3

–

12.3

Loss on disposal of investment properties

3.8

–

3.8

4.2

(0.8)

3.4

Changes in fair value of financial instruments and associated

close out costs

–

(0.1)

–

(0.1)

Deferred tax

–

1.9

Loss on disposal of subsidiary

–

39.7

Group’s share of joint ventures’ and associates’ adjustments

Revaluation of investment properties

(0.8)

–

(0.8)

(5.8)

–

(5.8)

Revaluation of derivatives

(0.2)

–

(0.2)

(0.5)

–

(0.5)

Deferred tax

0.2

–

0.2

0.6

–

0.6

Loss on disposal of investment properties

–

1.2

–

1.2

EPRA earnings

24.4

–

24.4

18.9

7.2

26.1

Share-based payment charge

1.1

–

1.1

0.9

–

0.9

Forward looking element of IFRS 9*

(0.2)

–

(0.2)

–

(0.2)

Depreciation on public houses

–

0.4

Head office relocation costs

0.5

–

0.5

–

Abortive costs

–

0.2

Restructuring costs

–

0.9

–

0.9

Underlying Funds From Operations (UFFO)

25.8

–

25.8

20.5

7.8

28.3

* Forward looking element of IFRS 9 relates to a provision against debtor balances in relation to invoices in advance for future rental income. These balances are not

due in the current year and therefore no income has been recognised in relation to these debtors.

Number of shares

2023

No. m

2022

No. m

Weighted average number of ordinary shares for the purposes of Basic EPS, UFFO and EPRA

309.7

307.2

Effect of dilutive potential ordinary shares:

Performance share plan

1.2

1.1

Deferred bonus shares

0.8

0.7

Weighted average number of ordinary shares for the purposes of Diluted EPS

311.7

309.0

2023

2022

Continuing

Discontinued

Total

Continuing

Discontinued

Total

IFRS Basic EPS

(5.4)

–

(5.4)

2.3

(10.9)

(8.6)

IFRS Diluted EPS

(5.4)

–

(5.4)

2.3

(10.9)

(8.6)

EPRA EPS

7.9

–

7.9

6.2

2.3

8.5

UFFO EPS

8.3

–

8.3

6.7

2.5

9.2

The below table reconciles the differences between the calculation of basic and EPRA NTA.

165

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Notes to the financial statements continued

14. Investment properties

2023

£m

2022

£m

Fair value brought forward

609.1 851.9

Acquisitions

– 7.3

Capital expenditure

2.9 9.6

Lease incentives, letting and legal costs

(0.1)

1.3

Transfer from assets held for sale (Note 18)

– 25.5

Disposals

(22.3)

(72.9)

Disposal of subsidiaries

– (202.3)

Net valuation movement

(38.1)

(11.3)

Fair value carried forward

551.5 609.1

Right of use asset (investment property)

75.8 75.5

Fair value carried forward

627.3 684.6

Capital expenditure of £2.9 million (2022: £9.6 million) is comprised of £1.9 million (2022: £5.0 million) of expenditure in the creation of

incremental lettable space and £1.0 million (2022: £4.6 million) of expenditure on non-incremental lettable space.

The Group’s investment properties have been valued at fair value on 31 March 2023 by independent valuers, Colliers International Valuation UK

LLP and Knight Frank LLP, on the basis of fair value in accordance with the Current Practice Statements contained in The Royal Institution of

Chartered Surveyors Valuation – Professional Standards, (the ‘Red Book’). The valuations are performed by appropriately qualified valuers who

have relevant and recent experience in the sector.

The Group is exposed to changes in the residual value of properties at the end of current lease agreements. The residual value risk born by the

Group is mitigated by active management of its property portfolio with the objective of optimising tenant mix in order to:

- achieve the longest weighted average lease term possible;

- minimise vacancy rates across all properties; and

- minimise the turnover of tenants with high quality credit ratings.

The Group also grants lease incentives to encourage high quality tenants to remain in properties for longer lease terms. In the case of anchor

tenants, this also attracts other tenants to the property thereby contributing to overall occupancy levels.

The fair value at 31 March represents the highest and best use.

The properties are categorised as Level 3 in the IFRS 13 fair value hierarchy. There were no transfers of property between Levels 1, 2 and 3.

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement

date. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or

indirectly. Level 3 inputs are unobservable inputs for the asset or liability.

As at 31 March 2023

Property ERV Property rent

Property

equivalent

yield

Average

EPRA topped

up net initial

yield

Average

Fair value

(£m)

Min

£ per sq ft

Max

£ per sq ft

Average

£ per sq ft

Min

£ per sq ft

Max

£ per sq ft

Average

£ per sq ft

Shopping Centres

– Core 214.8 8.8 30.1 14.0 8.0 30.8 12.9 9.3% 9.7%

Shopping Centres

– Regeneration 140.1 5.2 18.8 16.1 4.0 13.4 10.6 6.8% 5.9%

Shopping Centres

– Work Out 63.3 6.5 15.3 8.8 1.5 6.3 4.4 14.0% 9.4%

Retail parks

128.6 9.6 14.2 11.4 7.9 14.7 10.9 7.0% 7.0%

High street and other

4.7 4.2 8.6 6.6 3.7 8.7 4.1 9.5% 10.0%

551.5

166

NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023

Financial statements

As at 31 March 2022

Property ERV Property rent

Property

equivalent

yield

Average

EPRA topped

up net initial

yield

Average

Fair value

(£m)

Min

£ per sq ft

Max

£ per sq ft

Average

£ per sq ft

Min

£ per sq ft

Max

£ per sq ft

Average

£ per sq ft

Shopping Centres

– Core 216.2 8.5 30.1 14.2 8.2 30.7 12.8 9.3% 9.5%

Shopping Centres

– Regeneration 162.6 7.4 15.3 9.8 2.6 8.4 5.1 6.5% 5.8%

Shopping Centres

– Work Out 89.7 5.3 19.4 16.0 4.6 14.0 11.1 15.7% 11.1%

Retail parks

132.5 9.1 14.0 11.1 0.6 14.7 9.7 6.6% 6.0%

High street and other

8.1 5.4 15.0 8.0 3.8 8.6 3.0 8.4% 4.7%

609.1

Sensitivities of measurement of significant inputs

As set out within significant accounting estimates and judgements in note 2, the Group’s property portfolio valuation is open to judgements and

is inherently subjective by nature. As a result, the sensitivity analysis below illustrates the impact of changes in key unobservable inputs on the

fair value of the Group’s properties.

We consider +/-10% for ERV and +/-100bps for NEY to capture the increased uncertainty in these key valuation assumptions and deem it to be a

reasonably possible scenario.

The investments are a portfolio of retail assets in the UK. The valuation was determined using an income capitalisation method, which involves

applying a yield to rental income streams. Inputs include yield, current rent and ERV. Development properties are valued using a residual

method, which involves valuing the completed investment property using an investment method and deducting estimated costs to complete,

then applying an appropriate discount rate.

The inputs to the valuation include:

- Rental value – total rental value per annum

- Equivalent yield – the net weighted average income return a property will produce based upon the timing of the income received

- Estimated development costs

There were no changes to valuation techniques during the year. Valuation reports are based on both information provided by the Group, e.g.

current rents and lease terms which is derived from the Group’s financial and property management systems and is subject to the Group’s

overall control environment, and assumptions applied by the valuers, e.g. ERVs and yields. These assumptions are based on market observation

and the valuers’ professional judgement, which includes a consideration of climate change and a range of other external factors.

2023: Sensitivity impact on valuations of a 10% change in estimated rental value and absolute yield of 100 bps.

Impact on valuations of a 10%

change in ERV

Impact on valuations of 100 bps

change in yield

Asset Type

Retail asset

valuation

£m

Increase 10%

£m

Decrease 10%

£m

Increase 1.0%

£m

Decrease 1.0%

£m

Shopping Centres

– Core 214.8 18.2 (16.7) (21.7) 27.6

Shopping Centres

– Regeneration 140.1 13.5 (13.0) (18.9) 26.0

Shopping Centres

– Work Out 63.3 6.5 (5.8) (5.8) 7.4

Retail parks

128.6 9.7 (9.6) (14.2) 18.9

High street and

other 4.7 0.6 (0.6) (0.6) 0.7

551.5 48.5 (45.7) (61.2) 80.6

Notes to the financial statements continued

14. Investment properties

2023

£m

2022

£m

Fair value brought forward

609.1

851.9

Acquisitions

–

7.3

Capital expenditure

2.9

9.6

Lease incentives, letting and legal costs

(0.1)

1.3

Transfer from assets held for sale (Note 18)

–

25.5

Disposals

(22.3)

(72.9)

Disposal of subsidiaries

–

(202.3)

Net valuation movement

(38.1)

(11.3)

Fair value carried forward

551.5

609.1

Right of use asset (investment property)

75.8

75.5