Straits Trading to buy properties and development land in UK for £130m

Straits Trading to buy properties and development land in UK for £130m

Singapore-based investment company The Straits Trading said its subsidiary Straits Real Estate (SRE) is acquiring a portfolio of office and industrial buildings and several plots of development land in Gloucester Business Park for £130 million.

Gloucester Business Park is one of the leading business parks in the UK and the dominant business park in Gloucestershire, England.

Covering an area of over 276 acres, the business park has a strong mix of office, industrial and logistics properties that is supported by strong retail and commercial offerings. The plots being acquired represent the last remaining development plots within the park.

The business park is well connected to key transportation nodes with direct access from Junction 11A along the M5 Motorway linking Birmingham to the north, Bristol to the south, and London to the east via the A417 trunk line which leads to the M4 Motorway.

With an attractive 1:187 square feet parking ratio, ample parking spaces are an attractive draw for occupiers.

The portfolio consists of approximately 522,000 square feet of net lettable area across nine properties, seven of which are offices (approximately 311,000 square feet) and two of which are industrial (approximately 211,000 square feet), and 830,000 square feet of development land across six plots, the majority of which are consented for industrial and logistics development.

The existing properties are 100% occupied with the majority of its occupiers stemming from energy, cybertechnology, financial services, and healthcare sectors. With an attractive weighted average unexpired lease term of 8.1 years to break and 8.7 years to expiry, the tenant roster boasting a strong mix of credit tenants including EDF Energy, Ecclesiastical Insurance, GE Aviation, and Lockheed Martin provides solid recurring income over the coming years.

The development land includes five plots consented for industrial and logistics development and one small plot at the foot of the entrance targeted for retail use.

The plots are well suited for logistics development given its strong connectivity along the M5 and continuing tailwinds from e-commerce growth. It is envisioned that the plots will support up to 310,000 square feet of modern, environmental-friendly industrial buildings once fully developed.

Desmond Tang, Chief Executive Officer of SRE, said: “Following our acquisition of Bourne Business Park in Surrey, UK, we are delighted to acquire this portfolio of high-quality business assets in Gloucester Business Park as it fits our overall investment focus on new economy assets. It offers a balanced blend of recurring income at an attractive yield, while providing upsized return opportunities through development of logistics warehouses – a sector currently in strong demand. In addition, the existing properties have predominant exposure to energy, insurance and health sector tenants which are traditionally resilient businesses during inflationary periods. With the acquisition, we continue on track to grow assets under management to SGD3.5 billion in the next few years.”