Life Science REIT, the recently launched real estate investment trust focused on UK life science properties, has completed its maiden acquisition with a £77m purchase in London.
The group, which raised £350m in an initial public offering (IPO) in November, has bought Rolling Stock Yard, a nine-storey office and laboratory building near London’s St Pancras station from a joint venture of Newmark Properties, Argo Real Estate and Investec Bank. The purchase price of £77m reflects a net initial yield of 4.4%.
Rolling Stock Yard, which comprises more than 50,000 sq ft of office and laboratory space, is located on York Way just north of King’s Cross and St Pancras stations. The building was completed in March 2020 and has good sustainability credentials with a BREEAM Excellent rating and an EPC rating of A.
Occupancy of the property, which has attracted major life science companies including Gyroscope Therapeutics, is at 76%, with the company benefiting from an 18-month rental guarantee on the remainder. The property currently generates just under £3.5m of contracted rent per annum including guarantees. The property has a weighted average unexpired lease term (WAULT) of seven years.
Simon Farnsworth, managing director of Ironstone Asset Management, the company’s investment adviser, said: “We are delighted to announce Life Science REIT’s first major acquisition since our IPO last month.
“Rolling Stock Yard is a premium building at the heart of the important development area near London St Pancras, one of the UK’s most significant life science hubs and part of the sector’s ‘Golden Triangle’, where Google, DeepMind, the Francis Crick Institute and other major organisations have located offices along with the new Moorfields Eye Hospital which will be completed in 2026. Rolling Stock Yard offers attractive current income but importantly also includes significant asset management opportunities including the creation of further laboratory space to drive additional rental income growth.”
LABS : Life Science REIT makes maiden purchase