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UK Commercial Property REIT secures 40% rental uplift in trio of deals

UK Commercial Property REIT has secured new leases across three assets at a combined weighted premium of 40% to previous passing rent, reflecting the strength of occupier demand in the industrial and retail warehouse sectors.

Webcon, a supplier of car parts, has agreed a five-year lease renewal for the 10,000 sq ft Unit 1 at Dolphin Industrial Estate in Sunbury-on-Thames, Surrey. The new lease increases annual rental income on the unit by 63% to £155,000, or 4% ahead of ERV as at the December 2022 valuation, and includes a three-month rent-free period.

South West Ambulance Service has signed a new 10-year lease without break for Unit 111 at Emerald Park, Bristol, to be used as an office and a medical supply store. Rental income for the 8,800 sq ft unit has increased to £92,022 per annum, including a nine-month rent-free period, which is 21% ahead of previous passing rent and 2% ahead of ERV. The lease improves occupancy at the park to 100%.

Kentucky Fried Chicken (KFC) has agreed a 20-year lease renewal on the 2,400 sq ft Unit 4 at Trafford Retail Park in Manchester, with a tenant only break at the end of year 15 and a six-month rent-free period. The new lease will generate an annual rental income of £83,580, which is 17% higher than the previous passing rent and 9% ahead of ERV.

Will Fulton, fund manager, said: “Despite the current economic uncertainty, it is encouraging to see a buoyant occupier market for these assets continuing to drive the impressive leasing momentum we have achieved in recent months and allowing us to progressively capture the substantial reversion potential in our portfolio. These latest lettings were agreed at a significant premium to previous passing rents and reaffirms the strength of our high quality, well-situated assets that are diversified by sector and location. Our expert asset management team will continue to extract value from across our portfolio as we drive rental income on behalf of shareholders.”

UKCM : UK Commercial Property REIT secures 40% rental uplift in trio of deals

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