The property arm of Canadian Group BMO has executed deals worth £40 mln (€45 mln) in the UK regions for its property growth and income fund.
According to BMO Global Asset Management, the fund has increased its direct property exposure by £23.8 mln to £137 mln, or 26% of its total portfolio, following the recent transactions.
'These transactions are in line with the strategy of the fund to continue increasing its physical property exposure,' said George Gay, fund manager. 'They also demonstrate our progress in reducing some of our positions in smaller assets, when possible at a strong premium to valuation.'
The fund said it had completed the purchase of five assets across the Midlands and South East of England, for a total of £40.1 mln. The purchases include offices in Croydon (£6.15 mln) and Windsor (£7.14 mln) and industrial units in Harlow (£11.3 mln), Leamington Spa (£10.2 mln) and Tunbridge Wells (£6.25 mln).
The properties in Leamington Spa, Tunbridge Wells and Windsor all have fixed rental uplift agreements in place that are inflation-linked. The assets in Croydon and Harlow are let on reversionary leases respectively to technology company Sopra Steria and outsourcing business XPO Logistics, sublet to Clipper Logistics.
Further to these acquisitions, the fund has agreed the disposal of a portfolio of six industrial assets for £16.3 mln, 8% ahead of book value after transaction costs.
'We continue to review suitable direct property investment opportunities, with a preference for average lot sizes of between £6 mln to £8 mln, maintaining our focus on the UK’s industrial and office markets,' concluded Gay.
Joiner Cummings advised the fund on the disposals while Bidwells, Knight Frank and Chris Freer-Smith advised on the purchases.
