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McKay buys Reading warehouse

McKay Securities is spending £10.7m acquiring a freehold distribution unit – the 96,850 sq ft distribution facility is located at Junction 12 of the M4 motorway, adjacent to the Arlington Business Park at Theale in Berkshire, on the edge of Reading and 45 miles west of Central London.

The unit is let to Kuehne & Nagel, the international logistics and warehousing specialist, from where it runs a dedicated frozen distribution operation providing logistics support for Waitrose. The building is let until 2020 with a tenant only break clause exercisable on 9 months notice in January 2018, subject to a 12 month rent penalty payable by the tenant.  The annual rent of £750,000 pa is equivalent to £7.74 psqf. This, represents an initial yield of 6.6% on the purchase price. They reckon it should rent for £8.25 psqf.

The distribution facility was built in 1984. It comprises a steel framed warehouse of 83,225 sq ft with office and workshop facilities totalling 96,850 sq ft on a 6 acre site.  The low site cover results in the property benefitting from a large, secure yard. In addition to continued use for distribution, the property has planning consent for 209,992 sq ft redevelopment to office space as an extension of Arlington Business Park.

MCKS : McKay buys Reading warehouse

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