15th Dec 2023 12:56
(Alliance News) - Barkby Group PLC on Friday said its joint-venture with Meadow Partners LLP has completed its first acquisition, spending GBP5.3 million.
Shares in Barkby were down 5.9% to 5.97 pence each in London on Friday afternoon.
The Abingdon, England-based investor in roadside property and in consumer and life sciences companies said the purchase is part of the joint venture's plan to acquire and develop a portfolio of UK-based roadside real estate assets.
Barkby said the asset in Stoke, England was acquired by Meadow Partners in September and is selling it to the joint-venture at cost.
The acquisition will be funded in line with the joint-venture's equity commitments. Meadow Partners owns and funds 97%, while Barkby owns and funds 3%.
Accordingly, Barkby has made an initial equity contribution of GBP167,625 to the joint-venture to fund the acquisition.
The Stoke asset features 15,489 square feet of lettable space over four units on an average rent of GBP18.87 per square foot, representing a net initial yield of 7.95%.
The units are leased to brands 'Costa Drive Thru', 'TGI Friday's', 'Nando's' and 'wagamama', providing around GBP408,000 of net operating income with a weighted average unexpired lease term of 11.6 years and 9.4 years including lease breaks.
Barkby said 10% of the total projected net operating income will be indexed to retail price index uplifts.
"The Stoke asset has scope for several accretive investment opportunities, not least the installation of much-needed electric vehicle charging infrastructure," said Barkby Executive Chair Charles Dickson.
The site includes 239 car parking spaces, in which the joint-venture can install a minimum of 12 ultra-fast electric vehicle chargers at no cost. Barkby said these charging bays each have the potential to generate around GBP4,000 annual income on a 20-year lease with annual RPI uplifts.
"This acquisition follows practical completions at Barkby's wholly owned assets in Wellingborough and Maldon, which are both fully let and together generate over GBP500,000 of annualised rental income," said Barkby Chair Dickson.
"The joint-venture has a prospective roadside real estate investment pipeline in excess of GBP150 million, which we are confident will attract high-quality nationwide tenants, underpinning reliable, long term income streams.
"The joint-venture is in ongoing negotiation on a number of further site acquisitions as it works to deploy the joint-venture's equity commitment in assets that deliver sustainable returns for investors and valuable amenities to local communities."
By Greg Rosenvinge, Alliance News senior reporter
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