Orchard Street Investment Management acquired a retail park in England. The price of £35.3 mln (almost €40 mln) reflects a net initial yield of 6.25%.
London-based Orchard Street purchased Hermiston Retail Park in Consett, County Durham on behalf of wealth manager St James’ Place UK.
Hermiston Retail Park is a 157,000 square foot (14,585 m2) scheme anchored by a Morrisons supermarket. Other retailers include B&Q, Carpetright, Pets at Home, Poundland, Matalan and Sports Direct.
The Park has a long weighted average unexpired lease term of 16.3 years and 13.2 years to break, and is let off modest rents between £10.00 and £17.68 per square foot, with the supermarket lease providing five yearly RPI linked uplifts. Currently one of the units in the park is unlet.
Tom Chadwick, associate partner at Orchard Street, commented: 'This is a good quality retail park let off affordable rents which serves the local catchment very well. At a 6.25% yield, the length and quality of the income is very attractive especially when 50% of the income is attributable to the Morrison’s supermarket which has 20 years to lease expiry and RPI reviews.'
Orchard Street was advised by Morgan Williams, whilst Cushman & Wakefield advised Aviva.
