Custodian REIT acquires Chester high street retail property for £2.75m

Custodian REIT has announced that it has acquired a high street retail property in Chester, let to Signet Trading Limited (t/a Ernest Jones) and Feldale Retail Limited (t/a Lakeland).  The property is located in the city centre on the pedestrianised Eastgate Street, adjoining two other units in the Company’s portfolio. The agreed purchase price of £2.75 million was funded from the Company’s existing debt facilities, resulting in net gearing of 17.6% loan to value. The leases expire in September 2021 and September 2026 with a combined current passing rent of £140,000 per annum reflecting a net initial yield of 4.78%. Nearby occupiers include Cath Kidston, Jack Wills, Kuoni Travel, H Samuel, Fat Face and Accessorize.

Richard Shepherd-Cross, Managing Director of Custodian Capital Limited says that Chester is a leading destination for retail in the region due to a thriving tourism industry and excellent transport links. He also say that the unit adjoins two properties already held by Custodian REIT, which should provide a ‘marriage value’, and he expects that this will result in an overall valuation increase for the combined lot.

About Custodian REIT

Custodian REIT is a UK real estate investment trust, which listed on the main market of the London Stock Exchange on 26 March 2014. It says that its portfolio comprises properties predominantly let to institutional grade tenants on long leases throughout the UK and is characterised by small lot sizes, with individual property values of less than £10 million at acquisition. The Company describes itself as offering investors the opportunity to access a diversified portfolio of UK commercial real estate through a closed-ended fund. It says that, by targeting smaller lot size properties, it intends to provide investors with an attractive level of income with the potential for capital growth. Custodian Capital Limited is the discretionary investment manager of the Company.

Custodian REIT acquires Chester high street retail property for £2.75m