Urban Logistics REIT has bought five logistics assets for £33.1m just weeks after raising more than £90m in a fundraising.
The deals were all conducted off-market at a blended net initial yield of 6.4%.
The assets
Ripon
The group has acquired a 43,881 sq ft distribution unit in Ripon for £2.9m in a sale-and-leaseback deal from Xpediator, at a 6.25% yield. Nidd Transport, a third-party logistics operator recently acquired by Xpediator, has taken a 15-year lease at a rent of £4.56 per sq ft. The lease comes with five-yearly rent reviews linked to RPI with a cap and collar of 2% and 4%.
Braintree
Urban Logistics has also acquired a distribution warehouse in Braintree for £11.2m, a 5.25% yield. It is let to Delamode Group, also part of Xpediator, which is a freight and logistics provider. The two storey warehouse is let at £7.99 per sq ft through to 2025 and there is a rent review due in December 2020.
Oxford
A 71,384 sq ft distribution warehouse in Oxford was bought for £9.1m, reflecting a 6.6% yield. The unit is let to Ceva Logistics, which distribute sports apparel from the site for a leading global brand. The site is let at £8.41 per sq ft through to 2025 and there is an outstanding RPI-linked rent review. The site serves as a national distribution hub and is prominently located close to the A40.
Exeter
The Giant Booker-let unit was acquired for £5.1m, reflecting a 8.0% yield. It is located close to the M5 and is let until February 2030. The rent is £4.87 per sq ft and there is a rent review in 2025 to the higher of open market or 2.5% compound per annum.
Warrington
Let to CDS (Superstores International), which trade as The Range, the unit was bought for £4.8m at a yield of 7.4%. The site is let until December 2032 and the rent is £4.43 per sq ft. The rent increases at 2% compound per annum.
Chief executive comments
Richard Moffitt said: “These acquisitions were sourced off-market and are in line with our strategy of focusing on well-located logistics properties that supply essential products and consumer goods.
“Following the successful completion of our recent fundraising, we will now work to conclude the acquisition of further logistics properties from our established pipeline, enabling the rapid deployment of new funds into high-quality income-generating assets. With greater scale, we are confident that we can continue to deliver attractive shareholder returns.”
Interim results
The company will announce its results for the interim period ended 30 September 2020 on Thursday, 12 November 2020.
SHED : Urban Logistics REIT buys five assets for £33.1m