Custodian REIT buys car dealership – Custodian REIT has announced a further property purchase. The company has acquired a 24,845 sq ft car dealership on Pride Park business park in Derby, two miles from the city centre and prominently located on the busy A6. Nearby occupiers include Rolls Royce, Volkswagen, Lexus, Mercedes-Benz, Land Rover, and Ford.
The property is let to VW Group UK Limited and sub-let to Goodman Retail Limited (trading as Sytner) on a lease expiring on 23 November 2025 with a current passing rent of GBP342,500 per annum, reflecting a net initial yield(1) of 6.28%.
The agreed purchase price of GBP5.115 million was funded from the company’s existing cash resources, resulting in net gearing(2) increasing to 19.4% loan to value.
Commenting on the acquisition, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company’s discretionary investment manager), said: “We are delighted to have secured this well-established property within Derby’s prime motor retail pitch, let to one of the UK’s largest motor retailers on a long-term lease. The tenant has recently undertaken significant refurbishment works at the property, including an extension to the showroom floorplate, which demonstrates its commitment to the site.”
- Passing rent divided by valuation plus estimated purchasers’ costs.
- Gross borrowings less unrestricted cash divided by last published property portfolio valuation.
CREI : Custodian REIT buys car dealership