LGIM Real Assets (Legal & General) said on Wednesday that its Industrial Property Investment Fund (IPIF) has expanded its investment portfolio to over £2.5 bn (€2.84 bn) following a string of deals, investing over £100 mln in multi-let operational industrial assets and development sites across the UK.
IPIF’s strategy is to acquire undermanaged industrial estates and use its asset management skills to continue to add value and grow the fund over the long-term.
Representing the largest single transaction in the fund’s most recent string of deals, IPIF has acquired the Saxon Portfolio, a 525,000 sq ft (48,800 m2) portfolio comprising 11 multi-let light industrial and trade counter estates for £58 mln from PFC Property, with assets located in Worthing, Goring-by-Sea, Chichester and Midhurst.
The Saxon Portfolio is let to 74 occupiers with an average unit size of around 5,500 sq ft with a number of opportunities to increase value through active management. Notable tenants include World of Books, Booker Wholesale, Saint-Gobain, Screwfix and Toolstation.
Forming part of LGIM Real Assets strategy to build and diversify its real estate portfolio, IPIF has recently acquired two purpose-built operational self-storage assets in Bury and Lichfield, and an under-utilised retail park in Stevenage, Hertfordshire, with the intention to reposition the site into a self-storage, retail and trade park.
’As a result of our strategy to invest in multi-let industrials, a prudent gearing policy and strong asset management, alongside a commitment to future proof our portfolio through the delivery of net zero carbon by 2050, the fund continues to deliver significant added value and rental growth,’ said Jonathan Holland, senior fund manager at LGIM Real Assets.
Given the continued strength of the industrial sector, the fund is targeting a significant proportion of its new investment on value creation opportunities, primarily large scale development opportunities. With a focus on sectors that continue to see a growth in demand, IPIF has around 20 projects in the pipeline across urban logistics, trade developments and self-storage accommodation, requiring £200 mln of capital expenditure over the next two years. An equity fundraise is currently underway to support the delivery of these projects.
