Tritax Big Box REIT plc (Tritax Big Box) has acquired a prime temperature controlled distribution unit in the core South Coast location within the Nursling Industrial Estate in Southampton for £44.2 million, reflecting a net initial yield of 5.24%, in an off market transaction with a UK real estate fund.
The 325,000 sq ft building with extensive cold-store capabilities on a 20 acre site is let to Tesco on a 25-year lease expiring in January 2021.
Tritax Big Box said the £44.2 million consideration will be financed through £24.2 million of existing resources and the issue to the seller of 12,166,930 new ordinary shares in the company at a price of 164.38 pence per share. ”This issue price represents a 6.2% premium to the 30 June 2020 EPRA NAV. The new ordinary shares are subject to a six-month orderly market agreement in customary form.”
“This is a rare asset acquired off-market in a prime South Coast location next to the M27 motorway and close to the Port of Southampton. Benefitting from a strong existing tenant and a robust underlying occupational market, this building presents us with several attractive asset management opportunities which we expect will drive income and capital value growth. While the investment market for logistics assets continues to strengthen, there remain select attractive acquisition opportunities where significant value can be added through asset management,” said Colin Godfrey, CEO, Fund Management.