Warehouse REIT, the UK's AIM-listed urban warehouse specialist, has acquired a portfolio of five warehouse assets located across the UK from Greenstone Property Holdings for £43.6 mln (€49 mln).
Totalling 570,000 ft2 (52,950 m2) of space, the purchase price for the single-let and multi-let properties reflects a blended net initial yield of 6.7%, and provides a combined weighted average unexpired lease term of 5.5 years.
Located in established logistics markets, the portfolio is 90% occupied on leases with a total contracted annual rent of £2.95 mln. The portfolio was independently valued by CBRE as of 29 September 2020 at £44.55 mln in aggregate.
Andrew Bird, managing director of the investment advisor, Tilstone Partners, commented: 'This is an increasingly rare opportunity to acquire an immediately accretive and diverse portfolio of assets which fits with our stated investment strategy, whilst offering both short and longer-term asset management opportunities through a mixture of vacancy and short income.'
The individual assets include Gateway Park, which accounts for 56% of the portfolio by value. This 28-unit industrial estate totalling 220,000 ft2 stands adjacent to Birmingham Airport, generates £1.3 mln per annum of rent and is let to a tenant mix including global 3PL FedEx, pan-European freight distributor Circle Express and Swissport cargo services.
The other properties include a 50,000 ft2 unit on Viables Business Park in Basingstoke, occupied on a lease expiring in 2026 by global golf manufacturer TaylorMade, guaranteed by Adidas. The property is let off a low passing rent of £422,000, reflecting sub £9 per ft2.
Chittening Industrial Estate in Avonmouth is a 200,000 ft2 10-unit scheme generating £545,000 per annum of contracted rent. It is 88% let to a diverse range of tenants including Palletways UK, Encon Insulation and DS Smith.
The portfolio also comprises a three-unit warehouse property on Newport Road, Cardiff, totalling 50,000 ft2; and a 54,000 ft2 warehouse in Ebbw Vale, South Wales, leased to global 3PL DHL, on an eight-year term.
The latest deals continue the deployment of July’s £153 million equity raise and take Warehouse REIT’s portfolio to over seven and a half million ft2, the company said.
Bird added: 'Despite strong competition for industrial assets, as an increasingly diverse range of occupiers seek to ensure their businesses are fit for purpose as e-commerce penetration accelerates, we continue to originate and successfully execute on attractive transactions.
'The focus remains on deploying the balance of the equity from July’s capital raise, leveraging our local market relationships to secure off market opportunities, in order to further improve the portfolio metrics and generate shareholder outperformance.'
