LXi REIT has made nine acquisitions, which have been transacted predominantly on an off-market basis with seven different vendors/developers, total £87 million and reflect an accretive 5.1% net initial yield (net of purchase costs), versus the
current portfolio valuation yield of 4.5%.
The acquisitions were funded by the company’s recent £250 million equity capital raise. LXi REIT has acquired;
- three convenience stores in Norwich, Aston and Washington. Each benefit from new, unbroken 20-year leases to Co-operative Food Group Limited, with fixed rental uplifts of 2.5% per annum compounded every five years,
- a premium health and racquets club, extending to 100,000 sq ft and with 333 parking spaces. Facilities include an aerobics studio, fully equipped gym, indoor heated pool, sauna, steam room, spinning rooms, 4 badminton courts, 7 indoor and 3 outdoor tennis courts, 6 treatment rooms and hair salon,
The property is fully let to David Lloyd Leisure Limited with 25 years unexpired until first break. The passing rent is an exceptionally low £6.70 per sq ft and increases annually in line with RPI inflation, capped at 4% per annum. The property trades strongly, with a robust rent cover of 2.2X, and is well located in Hamilton, a popular commuter town serving Glasgow,
- a two-storey car park incorporating 385 spaces in York. The property is fully let to Q-Park Limited and guaranteed by Q-Park Holding BV on a long lease with 21 years unexpired to first break. The rent increases annually in line with RPI inflation, capped at 4% per annum and collared at 2.5% per annum,
- by means of a pre-let forward funding, a convenience store in Bewdley. The property has been fully pre-let to Sainsbury’s Supermarkets Limited on a new, unbroken 15-year lease, with five yearly CPI inflation linked rental uplifts, capped at 3% per annum and collared at 1% per annum compounded,
- a 44 bedroom Premier Inn budget hotel in ExeterThe property is fully let to Whitbread Group plc, parent company of Premier Inn, on a long lease with 16 years unexpired to first break. The rent reviews five yearly in line with CPI inflation, capped at 4% per annum compounded.
The property trades strongly, with a robust 2.4X rent cover, and is well located with a strong residual and alternative use value,
- a training facility extending to 160,000 sq ft across four buildings on a 12 acre site. The property is fully let to Compass Group Holdings plc, a FTSE 100 constituent with a market cap of approximately £31 billion, on a long lease with 20 years unexpired to first break. The current rent equates to a low £11 per sq ft and reviews annually in line with RPI inflation, capped at 5% per annum. The property is well located in Milton Keynes and is underpinned by a strong residual and alternative use value,
- a customer service, car storage and repair and maintenance facility in Edinburgh, by means of a sale and leaseback with Cazoo.
The property is fully let to Cazoo Limited on a new, unbroken 20-year lease with five yearly CPI linked rental uplifts, capped at 4% per annum and collared at 2% per annum compounded.
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