SEGRO sells Rome warehouse to Tritax EuroBox – SEGRO has exchanged contracts to sell a 158,000 sq m warehouse in Rome for EUR118 million. The transaction is expected to complete by the end of October 2018.
The warehouse was developed by SEGRO-Vailog in August 2017 for a global online retail company on a 15 year lease. It is located in Passo Corese, approximately 35 km north east of Rome, and was designed to cater for the occupier’s specific requirements, with three mezzanine levels on a footprint of 60,518 sq m.
Phil Redding, chief investment officer of SEGRO, said “Having developed and delivered this state-of-the-art facility for one of our key customers, the largest SEGRO has ever developed, we have taken the opportunity to sell the asset to capitalise on very strong demand from a wide range of international investors.”
Tritax describes the asset as a key part of the tenant’s pan-European network, The location has good access to the A1 (E45), the principal north-south axis motorway in Italy. The site benefits from good rail and airport connectivity and forms part of a new industrial/logistics park. The facility has a gross internal area of c.158,000 sqm, is built over three levels with a maximum eaves height of 14 metres and a site cover of 35%. The building has benefited from significant capital investment from the tenant.
The property, which is the occupier’s only regional fulfilment centre in southern Italy, is let on a 15-year full repairing and insuring lease that commenced on 7 August 2017, reflecting an unexpired lease term of just under 14 years. At the end of the 15 year lease there are two six-year extension options in favour of the tenant. The majority of the rent is subject to annual indexation.
Nick Preston, fund manager of Tritax EuroBox, commented: “We are delighted to announce the second investment for Tritax EuroBox plc, with the acquisition of this regional fulfilment centre, which provides the company with 14 years of core foundation income, let at a market level to a world leading online retail company.
This purpose-built asset is situated in a prime logistics location just north of Rome, Italy’s largest urban conurbation. Benefiting from excellent transport connectivity, the property plays a key role in the occupier’s network in Italy and across Europe and has benefited from significant capital investment.
Central Italy’s logistics market continues to see strong and growing demand from occupiers with limited availability of large-scale, modern, grade A logistics buildings and development land. Supply/demand dynamics evident in the Rome/Central Italy logistics market provide good income growth potential for this property.”
[QD comment: the unnamed client is Amazon. The notable omission in the announcement is an indication of the yield that Tritax EuroBox will be getting. Cantor Fitzgerald say the net initial yield is 5.0%.]
SGRO : SEGRO sells Rome warehouse to Tritax EuroBox