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- Tritax Big Box REIT doubles down on developments as market improves
Tritax Big Box REIT has said improving market conditions has reinforced its conviction for logistics development projects.
In annual results for the period to 31 December 2023, the company said that easing inflation, continuing rental growth, and improving yields on cost make its development programme more attractive.
It added that it will continue to sell portfolio assets that have achieved their full potential to reinvest the proceeds into higher-returning opportunities in the development pipeline.
The company added £13.6m to passing rent from 2.2 million sq ft of development lease completions in the year.
at a yield on cost of around 7.0%. A further 0.9 million sq ft of new planning consents were secured, bringing its total consented undeveloped land portfolio to 6.3 million sq ft.
The company announced the potential merger with UK Commercial Property REIT in February, a further update for which will be made soon. This will add logistics property to the portfolio and also give the company the option to sell non-core assets to reinvest into the development pipeline.
“We continue to drive portfolio performance by selling assets that have achieved their full potential in our ownership, reinvesting into higher-returning opportunities in our development pipeline and the investment market. Easing inflation, continuing rental growth, and improving yields on cost all reinforce our conviction in our development programme. In parallel, by leveraging our close customer relationships, we continue to create value through active management, making progress in capturing the record reversion embedded within our portfolio to further grow rental income.
“We are confident in delivering our strategy and are well positioned to take advantage of the opportunities both inherent within our business, and from an increasing number of opportunities in the market. The Group has very good potential for long-term income and capital growth, supported by enduring structural drivers in the logistics real estate market.”
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