Schroder European bolsters French logistics portfolio with €17.3m buy – Schroder European Real Estate Investment (SERE) has announced it has completed deals to acquire two logistics warehouses near Rennes, in Brittany, France, for €17.3m. The deals reflect a net initial yield of 5.9% and have been part funded with a new loan facility worth €8.6m.
SERE invests in fast-growing cities around Europe as part of its ‘winning cities’ strategy. Brittany is one of France’s fastest growing regions in terms of GDP and population growth. The company aims to provide a dividend yield of 5.5% – the current annual yield based stands at 6.36%.
12-year lease in place with fashion retailer
Providing 23,852 sqm of institutional quality space across two adjacent buildings, the property is let on a 12-year lease to C-Log, the logistics subsidiary of Groupe Beaumanoir, the international fashion retailer, which has invested significant capex in equipping the building with automated technology.
The property is located at the junction of two major arterial routes and benefits from excellent sea, high speed rail and air connectivity. In line with Schroders’ Winning Cities strategy, Brittany is one of France’s fastest growing regions in terms of GDP and population growth.
Jeff O’Dwyer, of Schroder real estate investment management, commented: “The 12-year lease on this asset to a strong covenant in a fast-growing region of France makes this another excellent addition to our already high-quality portfolio of assets. We have now deployed all of the proceeds from last year’s sale of low yielding retail assets into five warehouse investments, with a blended net income yield of approximately 6.4%, further diversifying the portfolio and increasing its allocation to the high growth industrial and logistics sector.”
€240m portfolio
Following the deal, SERE holds 13 properties with a value of approximately €240m and a blended net initial yield of 6.2%. The sector allocation is 46% office, 27% retail, 19% industrial and 8% mixed use.
SERE: Schroder European bolsters French logistics portfolio with €17.3m buy