22nd Dec 2021 11:03
(Alliance News) - LondonMetric Property PLC on Wednesday said it has acquired Savills IM UK Income & Growth Fund, the owner of a portfolio of 15 properties, mostly in and around London.
The real estate investment trust is paying GBP122.2 million, reflecting a yield on cost of 4.3% and an anticipated reversionary yield of 4.9%.
Savills IM UK Income & Growth Fund has a portfolio of 15 property assets offering 482,000 square feet, with 75% in urban logistics and the remainder being long-income assets, LondonMetric said.
Around 74% of the fund's assets are located in London and south east of England with key locations including Croydon, Farnborough, Hounslow, Greenwich, Guildford, Maidstone and Stevenage.
A further 12% are located in the Midlands.
Savills IM UK Income & Growth's portfolio has a weighted average unexpired lease term of 11 years, or 9.2 years to first break.
Its key occupiers include Decora Ltd, Fujitsu Ltd, Grafton LLP, HSBC Holdings PLC, Iveco Ltd, MKM Ltd and Volkswagen AG.
The portfolio generates GBP5.4 million of rent per annum with 43% of the income benefiting from contractual uplifts, LondonMetric added.
"Following our equity placing last month, we are pleased to have quickly invested a substantial proportion of the proceeds into this high-quality portfolio. Reflecting their London & South East weighting, we expect these assets will continue to perform strongly as high occupier demand and diminishing warehouse supply drive rental growth higher," Chief Executive Andrew Jones commented.
Savills Investment Management UK Income & Growth Fund Fund Manager Jamie Pearson added: "This portfolio has been carefully constructed on behalf of our investors. Our early move to create a portfolio dominated by high-quality London & South East Industrial assets has consistently delivered benchmark beating returns and ultimately a favourable exit for our investors."
Shares in LondonMetric were down 0.1% at 274.00 pence each on Wednesday morning in London.
By Abby Amoakuh; [email protected]
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