15th Sep 2014 06:36
LONDON (Alliance News) - LondonMetric Property PLC Monday said its joint venture with the Universities Superannuation Scheme has exchanged contracts to buy a Cornish retail park, while the company has also sold an office in Crawley and retail units in Launceston.
In a statement, the company said its joint venture with Universities Superannuation Scheme has exchanged contracts to acquire Liskeard Retail Park in Cornwall from a private property company for GBP9.0 million, reflecting a net initial yield of 6.2%. The 43,800 square foot retail park is let to Homebase, Pets at Home and Argos at average rents of GBP13.45 per square foot. The most recent letting was in 2010 at GBP16.50 per square foot. The park has an unexpired lease term of 12.8 years.
LondonMetric wants to become an equal partner in the joint venture, and will therefore fund the whole acquisition from its existing cash resources. Its stake in the venture will rise to 46% as a result.
The joint venture, called the Metric Income Plus Partnership, has also signed an extended debt facility with the Deutsche Pfandbrief Bank, extending the facility to GBP125 million and the term to January 2020 to match the extended life of the joint venture. Assuming the facility was fully drawn, the cost of debt will reduce to 3.7% from 4.3%, LondonMetric Said.
LondonMetric's own disposals comprise the Forest House office in Crawley, which its has sold to Mayfair Capital for GBP12.9 million, reflecting an exit yield to LondonMetric of 6.7%. It has also sold the units let to Carpetright and Topps units adjacent to its Launceston Retail Park to a private investor for GBP1.5 million, reflecting an exit yield of 7.0%.
"The off-market purchase of Liskeard is a great opportunity to acquire a good trading asset with a strong tenant line-up and excellent reversionary potential," London Metric Chief Executive Andrew Jones said. The acquisition will show an immediate 7.5% return on equity".
By Steve McGrath; [email protected]; @stevemcgrath1
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
LondonMetric