UK logistics REIT Urban Logistics has purchased five logistics assets for £33.1 million, reflecting a 6.4% net initial yield, located in Ripon, Braintree, Oxford, Exeter and Warrington.
“These acquisitions were sourced off-market and are in line with our strategy of focusing on well-located logistics properties that supply essential products and consumer goods,” said Richard Moffitt, Chief Executive at UK logistics REIT Urban Logistics.
“Following the successful completion of our recent fundraising, we will now work to conclude the acquisition of further logistics properties from our established pipeline, enabling the rapid deployment of new funds into high-quality income-generating assets. With greater scale, we are confident that we can continue to deliver attractive shareholder returns,” he added.
In Ripon, the company acquired a 43,881 sq ft distribution unit for £2.9 million from Xpediator plc at a 6.25% NIY. Nidd Transport, a third-party logistics operator recently acquired by Xpediator plc, has taken a 15-year lease as part of a sale and leaseback arrangement. The rent is £4.56 per sq ft and there is a five-yearly rent review linked to RPI with a cap and collar (2% – 4%)
In Braintree, the company acquired a modern distribution warehouse, which is subdivided into two units, for £11.2 million at a 5.25% NIY. The units are let to Delamode Group, also part of Xpediator plc, who are a freight and logistics provider. The two storey warehouse is let at £7.99 per sq ft through to 2025 and there is a rent review due in December 2020. The site is prominently located close to the A120.
In Oxford, the company acquired a high quality, automated 71,384 sq ft distribution warehouse for £9.1 million at a 6.6% NIY. The unit is let to Ceva Logistics who distribute sports apparel from this site for a leading global brand. The site is let at £8.41 per sq ft through to 2025 and there is an outstanding RPI-linked rent review. The site serves as a national distribution hub and is prominently located close to the A40.
In Exeter, the company acquired a unit in Exeter which is let to Giant Booker for £5.1 million at a 8.0% NIY. It is located close to the M5 and is let until February 2030. The rent is £4.87 per sq ft and there is a rent review in 2025 to the higher of open market or 2.5% compound per annum.
In Warrington, the company acquired a warehouse in Warrington which is let to CDS (Superstores International) Limited, who trade as The Range, for £4.8 million at a 7.4% NIY. The site is let until December 2032 and the rent is £4.43 per sq ft. The rent increases at 2% compound per annum. The site is located close to the M62.