1st Apr 2014 07:27
LONDON (Alliance News) - LondonMetric Property PLC said Tuesday it has exchanged contracts to develop a retail distribution centre in Northamptonshire.
The 70 acre site, located on the A14 in Islip, was acquired from Greatline Developments and already has an outline planning consent. Construction of the main works is expected to commence late summer with practical completion targeted for summer 2015, said the firm.
LondonMetric said it has already exchanged contracts to let the 1.06 million square foot retail distribution centre to an unnamed retailer on a new 25 year lease at an initial rent of GBP5 per square foot.
The total cost of the development, including the site purchase, is anticipated at approximately GBP77 million, reflecting a yield on cost of 6.9%.
Once the development has been completed, LondonMetric said its distribution assets will increase to 33% of its property portfolio, by value.
Andrew Jones, Chief Executive of the FTSE 250-listed company said, "This is one of the UK's largest ever pre-let developments and an integral part of our strategy to deliver well let short cycle developments in partnership with our key operators. The distribution market is evolving very quickly with take-up forecast at 50 million sq ft over the next five years. We are a partner of choice to many of the UK's leading operators and look forward to delivering this latest generation distribution centre which will materially enhance our existing portfolio and significantly grow our contracted rental income."
Shares in LondonMetric were trading 0.42% higher at 142.3 pence per share Tuesday.
By Alice Attwood; [email protected]; @AliceAtAlliance
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