In QuotedData’s morning briefing 30 December 2021:
- Secure Income REIT (SIR) is paying £33.45m in cash to Merlin Entertainments Limited, and in exchange Merlin has agreed it will extend the lease terms in respect of Alton Towers, Thorpe Park, Warwick Castle and Heide Park, Germany by 35 years, from 20.5 years currently, to 55.5 years without break. The rental payments will remain unchanged, however annual rent reviews of the UK assets, comprising Alton Towers, Thorpe Park and Warwick Castle, will change from uncapped annual upwards only inflation-linked (RPI) uplifts to annual reviews of inflation (CPI) +0.5% (with a floor of 1% per annum and a maximum increase of 4% per annum). The Heide Park, Germany lease will continue to have fixed reviews increasing annually at 3.34% for the full 55.5 year term. The weighted average unexpired lease term (WAULT) across the portfolio increases from 19.2 years to 30.0 years, the longest amongst the UK REIT sector peer group.
- Tufton Oceanic Assets (SHIP) has agreed to acquire a Product Tanker for $30.9m and a Handysize Bulker for $23.6m. The Product Tanker is being acquired at approximately 85% of depreciated replacement cost. It has a fixed rate time charter of 12 to 24 months producing a net yield over 8%, despite a relatively weak tanker market presently. The manager believes that positive drivers for both demand recovery and very low supply growth will significantly increase charter rates and values in the medium term. The Handysize Bulker is being acquired below depreciated replacement cost. It has a fixed rate time charter of eighteen to twenty-four months producing a net yield over 15%. Both vessels are already in the top quartile of fuel efficiency in their market segments but will be evaluated for further improvement, including the retrofit of energy saving devices.