Tritax Big Box REIT exchanges contracts on Merseyside acquisition – Tritax Big Box REIT (BBOX) has announced that the company has exchanged contracts, conditional on full planning consent, for the forward funded development of a new logistics “sortation centre” (see below) at Haydock, St Helens, Merseyside.
The property is pre-let to a company BBOX describe as “a financially robust world leading retailer”. The price represents a maximum commitment of £68.7 million, reflecting a net initial yield of 4.9% (net of acquisition costs to the company), rising to 5.4% at the first rent review in 2024.
The property
- The development will comprise a facility with docking to three sides, 360-degree circulation, an eaves height of 12 metres and service yards on three sides with 67 metre depths which is wider than the standard institutional specification to improve operational efficiency and HGV circulation.
- The new prime facility will be constructed to a high specification with a gross internal floor area of c.361,062 sq ft and low site cover of 24% compared to a standard logistics site cover of between 45/50%. The regular configuration of the site could therefore accommodate a building in total of c.700,000 sq ft at a more standard 45/50% site cover.
- The site is located in an established logistics area and adjoining the Haydock Industrial Estate, with excellent road connectivity directly onto the A580 which provides an East-West link between Manchester and Liverpool and J23 of the M6 motorway. As such, the location benefits from close proximity to the deep-water container port, Liverpool2, and to Manchester Airport. Haydock has a catchment population of c.2.5 million people within a 30-minute drive, providing a large workforce to draw from, which underpins the longevity of the area as an established UK distribution location.
- Upon practical completion of the construction, the property will be leased on a new 15-year lease, subject to five yearly upward only rent reviews indexed to the Consumer Price Index (collared at 1% pa and capped at 3% pa).
- The first rent review is targeted for September 2024.
- From completion of the land purchase and during the construction phase to the target date of PC, the Company will receive an income return equivalent to the agreed rent from the developer.
Comment from Colin Godfrey, Partner of Tritax
“We worked very closely with the Customer and Bericote to deliver this off-market pre-let development, which provides the Company with further exposure to a market leading occupier. Once operational, the building will represent one of the most advanced sortation buildings in the UK on a site with very low site cover, whilst further diversifying the Company’s portfolio by geography in an established logistics hub with strong labour supply.”
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*Sortation Centre – Coined by Amazon, a sortation centre is the final step in an order delivery chain. Unlike with a traditional order fulfilment process in which packaged orders go straight to the shipper for sorting and shipping, sortation centre employees receive and sort packaged orders before delivering them to the shipper.
Pictured is Tritax Big Box Doncaster, which incorporates modern design features including 17.5m eaves, office accommodation, cross docking, extensive and secure loading and car parking facilities.
BBOX : Tritax Big Box REIT exchanges contracts on Merseyside acquisition