LondonMetric Property has acquired Savills IM UK Income and Growth Fund in a corporate transaction for £122.2m, reflecting a blended yield on cost of 4.3% and an anticipated reversionary yield of 4.9%.
The fund owns a portfolio of 15 assets across 482,000 sq ft with 75% in urban logistics and the remainder comprising long income assets. Almost three-quarters (74%) of the assets are located in London and South East with key locations including Croydon, Farnborough, Hounslow, Greenwich, Guildford, Maidstone and Stevenage. A further 12% of the portfolio is located in the Midlands.
The portfolio has a weighted average unexpired lease term (WAULT) of 11.0 years (9.2 years to first break) and key occupiers include Decora, Fujitsu, Grafton, HSBC, Iveco, MKM and Volkswagen. It generates £5.35m of rent per annum with 43% of the income benefitting from contractual uplifts.
LondonMetric said that the assets were under rented and offer attractive reversionary potential and further asset management opportunities.
Andrew Jones, chief executive, added: “Following our equity placing last month, we are pleased to have quickly invested a substantial proportion of the proceeds into this high quality portfolio. Reflecting their London & South East weighting, we expect these assets will continue to perform strongly as high occupier demand and diminishing warehouse supply drive rental growth higher.”
LMP : LondonMetric acquires fund for £122.2m