Urban Logistics REIT has acquired nine assets and a development site for a total of £56.1m.
The deals follow its £136.1 million equity capital raise which completed in March.
The acquisitions were made at an average net initial yield of 6.3% and comprise: a portfolio of seven single-let regional distribution warehouses for £31.9m; an NHS distribution centre in Normanton for £13.0m; a regional distribution centre in Rubery for £5.5m; and a conditional agreement for the forward funding of a logistics property on a three-acre site in Peterborough.
Urban Logistics said it was in the final stages of negotiations to acquire a further portfolio, which is expected to complete in April.
Covid-19 update
The group said it had received 93% of rents for the quarter to June 2020 (ahead of the 91% collected at the same time last year). Urban Logistics said its portfolio has a notable bias towards food and pharmaceuticals, consumer staples and other essential goods.
Of the 38 properties in the company’s portfolio, four are not fully operational as a result of covid-19 and the Urban Logistics said it was discussing a revised payment plan with one of these tenants.
Acquisitions
The portfolio of seven single-let regional distribution warehouses comprises 482,012 sq ft of warehousing with a low capital value of £66 per sq ft, low average passing rent of £4.86 per sq ft and presents opportunities for asset management. The properties are located in Melksham, Redditch, Telford, Ellesmere Port, Glasgow, Tewksbury and Leeds.
Completion of one property, located in Glasgow, has been delayed as a result of Scotland’s Land Registry being closed, due to covid-19, and will take place when it reopens.
The Normanton property comprises 153,473 sq ft of space and is let to Unipart Logistics to 2036, with a rent review due in 2026, and serves as an NHS distribution hub. The 14-acre site has low site coverage of 25% and a passing rent of £4.70 per sq ft. There is the potential to add 80,000 sq ft of additional warehousing on site.
The Rubery property comprises 51,600 sq ft of space and is let to Aqua Pak Polymers through to 2031 with a parental guarantee from Systems ADI Group Limited. Rent is subject to review in 2021 and 2026 and linked to RPI with a 3.0-5.0% cap and collaR.
Urban Logistics has committed to acquire a three-acre land site and forward fund a 46,500 sq ft facility at the Peterborough Gateway Logistics Park at a total development cost of £5.8m. The project is part pre-let to DPD.
SHED : Urban Logistics acquires £56.1m of assets