Warehouse REIT spends £82m – Warehouse REIT has completed the acquisition of two single-let warehouse assets located in the East Midlands and Cheshire, occupied by Amazon and Wincanton respectively. The assets have been purchased in two separate transactions for a total consideration of £82 million, reflecting a blended net initial yield of 5.4% and provide a combined WAULT of 9 years. These deals have been funded by last month’s fundraise.
The East Midlands property is strategically located just off the M1 motorway, the key logistics spine of the UK, outside the town of Chesterfield. The prime 500,000 sq ft fulfilment centre is let to Amazon UK on a full repairing and insuring lease with over 13 years remaining, benefitting from five-yearly upward only rent reviews with no breaks. The company has acquired the asset for cash consideration of £57 million from Tritax Big Box REIT and when combined with the other Amazon-occupied properties in Warehouse REIT’s portfolio, at just over £4m rent per annum as a result of this acquisition, the e-commerce giant is now the largest tenant on the rent roll.
The second acquisition comprises a 374,000 sq ft single-let warehouse located adjacent to the 29 acre multi-let estate at Midpoint 18 in Middlewich, Cheshire, which was acquired last year and increases Warehouse REIT’s total holding at this location to over 550,000 sq ft. The asset, acquired for cash consideration of £25 million, is occupied by Wincanton Holdings Limited, the UK’s largest third party logistics operator, and has 3.5 years remaining on its lease off a low passing rent of c£5 psf, which compares favourably to lettings that the company has recently achieved on the wider estate. New-build development activity locally reinforces the strength of the Midpoint Estate’s distribution location, which sits within two miles of Junction 18 of the M6 motorway and approximately 26 miles south of Manchester.
WHR : Warehouse REIT spends £82m