Urban Logistics, UK industrial and logistics REIT, has signed agreement for the forward funding of two high-quality urban logistics assets at Staffordshire’s Stone Business Park and Leicestershire’s Lime Kilns Business Park in Hinckley, depending on receipt of planning permission.
The gross development value of the Acquisition is £15.4 million and will be financed from the Company’s cash resources including the proceeds from two property sales, one of which is expected to exchange in the near future, together with debt from its existing club facility.
The site at Stone will comprise four logistics units with a total gross internal floor area of 86,000 sq ft. Stone Business Park is an established industrial location and benefits from direct access to junctions 14 and 15 of the M6.
The site at Hinckley will comprise two units with a total gross internal floor area of 63,500 sq ft. Lime Kilns Business Park has direct access to the A5 and is close to junction 1 of the M69, enabling easy onward access to the M1 and M6.
During the construction of both assets, which is expected to commence in June 2019, the Company will benefit from a 6.0% interest rate coupon on the forward funding provided. Practical completion for Stone and Hinckley is being targeted for December 2019 and January 2020 respectively.
Commenting on the acquisitions, Richard Moffitt, Chief Executive, said:
“These acquisitions will add high quality new assets to the Company’s portfolio at a time when smaller urban logistics sites are in short supply. We have experienced strong interest from prospective tenants and expect to be fully pre-let by the time both assets reach practical completion.
“Today’s acquisition is another example of our approach to selecting the right properties, creating value through asset management and recycling capital into new opportunities to deliver sustainable long-term shareholder value.”