Tritax Big Box REIT, a listed vehicle exposed to the 'Big Box' logistics asset class in the UK, has completed a land purchase in Oxfordshire and exchanged contracts to provide forward funding for the development of a new distribution centre.
The development project, a distribution facility at Signia Park in Didcot pre-let to publisher Hachette UK, represents an investment of £29.24 mln (€35 mln), reflecting a net initial yield of 5.82%.
'We are very pleased to be investing in this new national and global distribution centre for Hachette UK, which will benefit from operational efficiencies delivered through significant automation,' commented Colin Godfrey, partner of Tritax.
'This key South East logistics acquisition provides the company with further tenant and business sector diversification whilst maintaining the weighted average unexpired lease term of the company’s portfolio at over 15 years, and is earnings accretive. This takes our total portfolio to 38 assets.'
The new 242,067 ft2 (22,500 m2) development will become Hachette UK’s main national and global distribution centre and will benefit from significant capital investment from the tenant. Hachette has signed a 15-year lease subject to five yearly upward-only rent reviews.
Tritax said it was funding the land purchase from equity proceeds, with senior debt finance expected to be introduced in the near term.
Constructed by Winvic Construction and developed by Clowes Developments UK, the project should be completed in July 2017.
GVA represented Tritax and JLL represented Clowes Developments, the vendor, and Graftongate, the development manager.
