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Schroder European Real Estate buys three industrial properties – Schroder European Real Estate Investment Trust has exchanged contracts to purchase three industrial assets in the Netherlands for a total purchase price of EUR19.8 million, reflecting a combined net initial yield of 6.5%, with a weighted unexpired lease term of approximately 9 years.
After these deals, the portfolio will comprise 12 properties with a value of approximately EUR222 million. The portfolio will generate contracted rents of EUR16.1 million with an average unexpired lease term to first break and expiry of 5.1 years and 6.7 years (per end of June 2018). The acquisitions provide further sector diversification, with the portfolio having the following allocations; 49% office, 29% retail, 13% industrial and 9% mixed use.
The company has now redeployed the majority of net proceeds raised from the July sale of two low yielding Casino supermarkets, part of the strategy to grow income and total returns. Along with the Rumilly logistics acquisition announced in July, the company has already replaced 90% of foregone Casino income and has a remaining investment capacity of approximately EUR15 million. Completion of the transactions will occur towards the end of August (Houten) and September (Venray and Utrecht).
Jeff O’Dwyer, at Schroder REIM, commented: “We have been actively looking to further diversify the portfolio and increase the Company’s allocation to the high growth industrial and logistics sector. These assets are in established industrial locations and offer a stable income profile with growth upside from broader improving city and regional fundamentals. With prime Dutch logistic yields breaking 4.5% we see value in smaller lot sizes, particularly in locations where investment and occupier demand is strong. These acquisitions demonstrate our ability to leverage Schroders’ European investment expertise to identify new investment opportunities and quickly recycle proceeds from disposals, capitalising on opportunities to realise profit and deliver share holder value.”
SERE : Schroder European Real Estate buys three industrial properties
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