LondonMetric Property has sold a portfolio of long income assets to Realty Income, an S&P 500 US REIT, for £40.9m, reflecting a blended net initial yield of 5.9%.
The portfolio, which has a WAULT of 11 years, comprises:
- A 106,000 sq ft retail asset in Leicester let to B&Q, Home Bargain and Smyths Toys. The property generates a rent of £1.8m per annum and is let for a further 10 year term following a recent re-gear of the 77,000 sq ft B&Q store;
- A 32,000 sq ft Wickes store in Halesowen, which LondonMetric acquired as part of the Mucklow acquisition, with a WAULT of 8 years;
- A 15,000 sq ft Aldi store in Hull which has a WAULT of 9 years; and
- Three KwikFit service stations which had been acquired through a larger portfolio acquisition and have a WAULT of 14 years.
The assets have delivered an ungeared IRR of 8% per annum and the sale crystallises a total return on cost of 50% over an average hold period of six years. The disposal is at a 7% premium to the last reported book value.
Andrew Jones, chief executive, said: “These are all very well let assets that have delivered strong performances and their disposal crystallises an attractive surplus to our original purchase prices. The transaction is in line with our strategy of allocating further capital into the logistics and convenience grocery sectors.”
LMP : LondonMetric sells long income portfolio for £41m